3.2(1) Economic Growth

Question 1

Actual growth

Answer 1

Realised increase in real national output for a given time period.

Question 2

Potential growth

Answer 2

Increase in the economy’s productive capacity over a given time period.

Question 3

Sustained growth

Answer 3

Positive and stable growth rate without significant upward pressure on the GPL over an extended period of time.

Question 4

Sustainable growth

Answer 4

Rate of growth that can be sustained without creating other significant economic problems, particularly for future generations.

Question 5

Inclusive growth

Answer 5

Rate of growth that is sustained over a period of time, is broad-based across economic sectors and creates productive employment opportunities for the majority of the country’s population.

Question 6

Government expenditure

Answer 6

Total spending by the government on goods and services (including capital goods).

Question 7

Transfer payments

Answer 7

Total spending by the government to increase equitable access to basic necessities.

Question 8

What are the polices to achieve economic growth?

Answer 8

– Expansionary fiscal policy
– Expansionary interest rate monetary policy
– Expansionary exchange rate monetary policy
– Supply-side policies
– Policies to achieve sustainable growth
– Policies to achieve inclusive growth