20 Marker

Question 1

Define economic growth

Answer 1

Increase in an economies output over time it is measured by the percentage change in real GDP per time period

Question 2

What are the three benefits of economic growth towards the economy

Answer 2

Lower unemployment, higher living standards, increase tax revenue

Question 3

What are the 2 costs of economic growth

Answer 3

Negative externalities, Depends on the distribution of economic growth

Question 4

Explain lower unemployment

Answer 4

Increase in output and positive economic growth, firms tend to employ workers creating less unemployment

Question 5

Explain higher living standards

Answer 5

GDP rises, more money in domestic economy. Business can make profits, can pay employees higher wages, even higher more employees.

GDP per capita rises. RDI of workers increases, purchasing power increases, living standards increase

Question 6

Explain an increase in tax

Answer 6

Can be spent on health and education, increasing economic development such as GN I per capita, life expectancy at birth as well as average/expected years in school, and improves human welfare overtime to give peoples lives value and meaning

Question 7

Explain negative externalities

Answer 7

Increase in pollution and congestion, cause health problems, quality of life, unsustainable economic growth

Question 8

Explain diagram

Answer 8

Axes are real GDP and price level. Have a aggregate supply curve aggregate demand straight line increase in aggregate demand increase in price level increase of real GDP

Question 9

Explain depends on distribution of economic growth

Answer 9

If growth primarily benefits the rich in the society, Growth my hardly decrease poverty because it is not closing the gap between the poor and the wealthy is in fact largening