The Consequences of Economic Growth - Essay Example

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This essay, The Consequences of Economic Growth, presents economic growth which is the ultimate goal of any society or nation on a macroeconomic scale that would subsequently elevate the national standard of living and alleviate throngs of the population from the scourges of poverty. …

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Subject: Macro & Microeconomics
Type: Essay
Level: Undergraduate
Pages: 5 (1250 words)
Downloads: 1
Author: monica39

Extract of sample "The Consequences of Economic Growth"

Download file to see previous pages This discussion highlights that with increased economic transaction between populations within and outside of national borders have led to greater economic growth throughout many parts of the planet. Employment increases, the cost of products decrease to a competitive market level, and the number of firms and the quality of firms increase. As a developing economy grows, there is a greater propensity and incentive for foreign governments to provide some form of economic aid, which is also in their benefits for their own economic expansion.
From the study it is clear that with the spread of commerce comes the spread of newer technologies. With the breakthroughs in technologies in the telecommunications industry, the technology itself has become more accessible for lower income customers. Anyone with an internet connection can now communicate and do business with anyone else in the world. This has led to a rapid growth in traditionally lesser-developed countries, because now there is a productive work force with the means to enlarge their economic fortunes. With the greater diffusion of technologies, entrepreneurs have become more empowered and enfranchised with freedom to pursue business ventures and this had led to a growth in business. Nations with no economic development at all are subject to civil war, systemic poverty, famine, and political instability, as often and tragically observed in Sub-Saharan Africa or Central Asia in the present day. ...Download file to see next pages Read More

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Economic Growth 4(a) Y = Output per worker K = Physical capital per worker A>0 =Product parameter is constant Y = AK^0.5 Considering the level of capital that is the golden rule, then y = n + δ. Given parameter values and the capital per person the result is:
y= (1/2) K^1/2 = (1/2) * 4^1/2 = 0.25 > n + δ = 10
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The Consequences of Economic Growth - Essay Example

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