ECON 1010 Chapter 22.1-3: Chapter 22.1-3 Economic Growth
11 Feb 2017
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Economic growth is the expansion of production possibilities. A rapid pace of economic growth can transform a poor nation into a rich on. We express a growth rate as the annual percentage change of a variable - the change in the level expressed as a percentage of the initial level. Real gdp growth rate = billion - billion / The growth rate of real gdp tells us how rapidly the total economy is expanding. This measure is used for telling us about potential changes in the balance of economic power among nations. But it does not tell us about changes in the standard of living. The standard of living (aka per capital real gdp) , which is real gdp divided by the population. So the contribution of real gdp growth the change in standard of living depends on growth rate of real gdp. To calculate growth rate of real gdp per capita we replace real.
