A-Level - Economic Growth

How is economic growth measured?

• A. changes in consumer expenditure

• B. changes in living standards

• C. changes in population size

• D. changes in real GDP

A country experiences a 4% rise in real GDP and a 4% rise in nominal GDP.

What would explain this combination of changes?

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What must have increased as a result of a rise in real GDP?

• A. output

• B. inflation

• C. income inequality

• D. population

What may reduce economic growth in the short run but increase it in the long run?

• A. a decrease in government spending on healthcare

• B. a decrease in the size of the labour force

• C. an increase in the inflation rate

• D. an increase in the savings ratio

Why may a government switch from aiming for a 5% growth rate to a 0% economic growth rate?

• A. to avoid anyone being without a job

• B. to conserve non-renewable resources

• C. to maintain real GDP per head

• D. to reduce living standards