Question

• Briefly provide your understanding of the relationship between economic growth (GDP growth), high/low unemployment, high/low wages, and the way they impact one another.

Answer 1

MEANING OF ECONOMIC GROWTH -

Economic growth means an increase in total production of goods and services and national income of a country within a specific period of time. So, economic growth is the process in which all efforts are made to increase national income, national output, per capita income, per capita output and standard of living of people by exploiting all the available resources of country within a specific period of time. Generally economic growth can be measured by GNP ( gross domestic product) and GNP ( gross national product).

ECONOMIC GROWTH AND THEIR RELATIONSHIP AND EMPACT -

ECONOMIC GROWTH AND UNEMPLOYMENT-

Basically low and high unemployment rate is affected by population. If population in any country increasing and rate of increase in population is more than that of economic growth and then there is a high unemployment occur and if the population in that country increasing but the rate of increase in population is less than that of economic growth than there will low unemployment.

ECONOMIC GROWTH AND WAGES -

Increase in national output and national income result in an increase in wages rate in that particular country but ( if increase in population rate is less than the rate of economic growth). And if increase in population rate is high than the rate of economic growth than national income less and eventually leads lower wages rates.