Question

1. What political and legal failures can impede a country’s economic growth rate?
2. Why has China’s economic growth rate risen dramatically over the last 35 years? (Name at least one cause.)
3. Which parts of the world have the highest and lowest GDP/capita?
4. What special challenges (name at least one) do the least developed countries have for achieving economic growth?

Answer 1

1. What political and legal failures can impede a country’s economic growth rate?

Economic growth can be defined as the constant increase in overall production levels of goods and services in the economy which tends to increase the overall standard of living of people and helps the country in competing with one another respectively.

Over the years, many countries have been able to control and follow targeted economic growth policies which have helped them in growing various sectors.

Talking about political and legal failures, a country with an unstable government which cannot last its full term, is regarded to have a lower growth rate than those which have well established policies and stable governments which work towards better market conditions in the economy.

Further, countries with strong legal systems tend to grow at a much higher rate than those which tend to not provide easy and speedy justice.

Such problems lead to failures in the economy as the government or the judiciary of the country are weak and business owners do not want to invest into such countries respectively.

Question 2) why has China’s economic growth rate risen dramatically over the last 35 years? (Name at least one cause.)

Over the last 35 Years, China has seen rapid growth and transformation of its people. This has primarily been accounted due to the liberal reforms which took place in the country, and it got turned into a manufacturing hub, thanks to the lower costs of production.

Further rapid industrialization and increased government funding of the Manufacturing Sector meant that it was easier to produce goods and services and export them to other countries which themselves could not produce at such low rates.

Thus increased funding and low cost production has served as the biggest reasons for economic growth of China over the last 35 years respectively.

1. Which parts of the world have the highest and lowest GDP/capita?

The country of Monaco which is relatively a low population country is sought to have the highest GDP/capita which is currently valued at about US$166,285. On the other hand South Sudan which is an African origin nation has the lowest clocked at only 247$ GDP/Capita respectively.

The GDP per capita is calculated by dividing the overall GDP of the country with the total number of people living in the country respectively.

1. What special challenges (name at least one) do the least developed countries have for achieving economic growth?

When a country is on the path of development, the major challenge it faces is that it increases the overall levels of production and the quality of goods and services provided which leads to a sudden increase in prices for the poor people of the nation.

This causes an inflation in the economy which if unchecked can lead to major trouble and even lead to hyperinflation if the government were to formulate wrong policies at this stage, making it impossible for the weaker sections to avail same benefits they could get easily before.

Thus the rise in inflation along with growth is a serious reason to be considered while achieving economic growth respectively.

Please feel free to ask your doubts in the comments section.