Impact Of Economic Growth

Question 1

Sustainable growth

Answer 1

Growth in productive potential of economy today that’s don’t … lower productive potential of the economy for future gen

Question 2

Easterlin paradox - growth & happiness

Answer 2

● Happiness depends on relative income & wealth
- despite econ growth ppl in HIC don’t feel happier
- rich ppl feel happier when compared to poorer ppl
- happiness positively at low income lvls bc increase consumption = basic needs met

Question 3

Econ growth C pros (2)

Answer 3

● increase disposable income - household increase income overtime … increase g/s
● decrease unemployment - increase standard of living

Question 4

Econ growth C cons (4)

Answer 4

● increase envir harmful effect … health problem
● income/wealth inequalities
● D pull inflation
● Structural unemployment

Question 5

Econ growth firms pros (4)

Answer 5

● increase profit
● increase animal spirits - opportunity to increase sales bc C have more money to spend
● increase tech advancements - increase R&D reinvestment … seek ways to improve efficiency
● increase workforce size

Question 6

Econ growth firms cons (2)

Answer 6

● increase wages … increase CofP … cost push inflation
● tech advancements … firms find their market disappearing

Question 7

Econ growth gov pros (2)

Answer 7

● increase tax revenue
● fiscal dividend

Question 8

Econ growth gov cons (1)

Answer 8

● current account deficit … lose macro obj