Question

how is economic growth measured? Why is economic growth important? Why could the difference between a 2.5 percent and a 3 percent annual growth rate be of great significance over several decades? Give some example to support your answer. No hand writting please.

Answer 1

Solution:-

Economic growth is an indicator of how a country's economic condition is improving or deteriorating. If a country is showing zero or negative economic growth, then it is regressing backward, to a lower-developed stage. The country's economics tumble and the citizens' standard of living start becoming poorer. Therefore, growth is an important indicator.

Growth is measured by change in GDP from year to year. If GDP is showing an increasing trend, it means the country is economically growing. A declining trend in GDP is a matter of serious concern, since it indicates the country ahs serious growth problems.

Som economists also suggest measuring growth using change in per capita GDP, that is, change in [GDP / Population] of a country. But this basically indicates how an economy's standard of living is increasing.

Hope It helos you..