Lesson objectives
By the end of the lesson students should be able to:
1 define and calculate economic growth
2 explain ec...
Economic growth can be defined and measured in
two ways:
 As an increase in real GDP (real national output)
over time.
 ...
 Economic growth is measured in terms of
percentage changes in real GDP/ GDP per capita.
Assume that in 1988, real GDP fo...
 The Quality and Quantity of Natural Resources
 Quantity and Quality of Human Resources
 Increase in Physical Capital
...
 Higher consumption
 Economic development
 Employment creation
 Higher standard of living
 Poverty reduction
 More t...
 Depletion of natural resources
 Negative externalities
 Technological unemployment
 Urbanisation
 Long term effects ...
 the quality and access to education and training
 Promotion of research and development
 A deliberate policy to stimul...
 Growth in real output that is achieved
without depleting natural resources or
harming the natural environment
 BUSINESS OR ECONOMIC OR GROWTH CYCLE
is the recurrent pattern of fairly predictable
fluctuations in the growth rate of r...
 A sustained increase in the total output or
real GDP of an economy
 Economic activity is expanding rapidly. Many
firms ...
 A period following economic recovery in an
economic cycle, characterized by an
economy working at full or near-full capa...
 A general slowdown in the rate of economic
growth in an economy following an economic
boom. Officially, it is usually as...
 A period following an economic recession in
an economic cycle during which aggregate
demand, output, employment and inco...
 Explain what is meant by economic growth
 Discuss how trade and investment can help
economic growth
 Discuss whether e...
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Economic growth and_development

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Economic growth and_development

  1. 1. Lesson objectives By the end of the lesson students should be able to: 1 define and calculate economic growth 2 explain economic development 3 explain the causes of economic growth 4 discuss the advantages and disadvantages of economic growth 5 explain the growth cycles 6 discuss policies to alleviate poverty
  2. 2. Economic growth can be defined and measured in two ways:  As an increase in real GDP (real national output) over time.  As an increase in real GDP per capita. Growth in real per capita incomes is perceived to be a better measure of economic performance.
  3. 3.  Economic growth is measured in terms of percentage changes in real GDP/ GDP per capita. Assume that in 1988, real GDP for a country was $450bn and in 1989, this figure rose to $500bn. Then the growth rate as measured by the percentage increase in real output is given as:  This implies that the economy produced 11.1% more of physical goods and services than in the previous year.
  4. 4.  The Quality and Quantity of Natural Resources  Quantity and Quality of Human Resources  Increase in Physical Capital  Technological Progress  Allocation of Resources
  5. 5.  Higher consumption  Economic development  Employment creation  Higher standard of living  Poverty reduction  More tax revenue for government  Military and political influence
  6. 6.  Depletion of natural resources  Negative externalities  Technological unemployment  Urbanisation  Long term effects of inflation and deficit balance of payment
  7. 7.  the quality and access to education and training  Promotion of research and development  A deliberate policy to stimulate savings  Stimulation of private investment  Promotion of free trade and competition  industrialization policy
  8. 8.  Growth in real output that is achieved without depleting natural resources or harming the natural environment
  9. 9.  BUSINESS OR ECONOMIC OR GROWTH CYCLE is the recurrent pattern of fairly predictable fluctuations in the growth rate of real GDP over time  Growth(expansion)  Economic boom(peak)  Economic recession(downturn)  Economic recovery (upturn)
  10. 10.  A sustained increase in the total output or real GDP of an economy  Economic activity is expanding rapidly. Many firms enjoy increased sales and profits. New firms are formed. Output, income and employment are all increasing.
  11. 11.  A period following economic recovery in an economic cycle, characterized by an economy working at full or near-full capacity with a low level of unemployment and aggregate demand, sales and profits at or near their peak, and often accompanied by rising inflation
  12. 12.  A general slowdown in the rate of economic growth in an economy following an economic boom. Officially, it is usually associated with prolonged period of negative growth in real GDP  Economic slump/depression is a prolonged recession during which economic activity shrinks and unemployment remains very high. There may be deflation as a result.
  13. 13.  A period following an economic recession in an economic cycle during which aggregate demand, output, employment and incomes begin to rise
  14. 14.  Explain what is meant by economic growth  Discuss how trade and investment can help economic growth  Discuss whether economic growth is always advantageous  Discuss whether economic growth should be the main aim of government economic policy

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