ECON 1010 Chapter Notes - Chapter 22: Potential Output, Business Cycle, Macroeconomics
12 Feb 2018
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The basics of economic growth: economic growth is the expansion of production possibilities, a rapid pace of economic growth maintained over a number of years can transform a poor nation into a rich one. Such as have been the stories of hong. Kong, south korea, and some other asian economics: slow economic growth or the absence of growth can condemn a nation to devastating poverty. Such has been the fate of sierra leone, somalia, zambia, and much of the rest of africa. Calculating growth rates: we express a growth rate as the annual percentage of a variable the change in the level expressed as a percentage of the initial level. Real gdp growth rate = (real gdp in current yr real gdp in previous yr) x 100. Real gdp in previous year: the growth rate of real gdp tells us how rapidly the total economy is expanding.
