Economic Growth Test

Question 1

What is Sustainable Economic Growth?

Answer 1

• occurs when economy’s grows at a place that enables people to satisfy more of their material wants.
• increases their non-material well being while not compromising the living standards of future generations.

Question 2

Importance of economic growth.

A strong economic growth results in:

Answer 2

• More goods and services being produced
• More workers required to produce goods and services
• More income received by the worker
• More spending in the economy - consumption and investment
• Higher living standards

Question 3

What does GDP measure?

Answer 3

Economic performance and progress of something

Question 4

Having a high GDP is…?

Answer 4

• Is a key object of government as they know that higher economic growth will allow consumers to satisfy more wants.

Question 5

What can a high GDP improve for consumers?

Answer 5

Their living standers will increase.

Question 6

High economic growth rate:

Answer 6

Enables people to do more of what they enjoy and gain access to better quality public service such as health and education.

Question 7

Benefits of high economic growth:

Answer 7

1. EGR increases = population increases = more demand = more products produced = more jobs created
2. Increased EGR = consumers satisfy more wants = higher material living standards
3. Increased EGR = more workers needed = income therefore rises

Question 8

Costs of high economic growth:

Answer 8

1. Increased demand for products = increase price of products (inflation)
2. Increased consumption of non-renewable resources = increased pollution + environmental habitats
3. Increased EGR= increase population = congestion on roads + demand from consumers = pressure on already exciting products