What is the relationship between economic growth and


PART 1

The long-run growth is measured as the increase in real GDP per capita and this measure has changed over time and it also varies across countries. A country's standard of living depends on its ability to produce goods and services (productivity).

a. How do we measure long-term economic growth of a country? What are the key determinants of long-run economic growth?

b. What is the relationship between economic growth and productivity? What is the major source of growth in labor productivity?

PART 2

There are different types of financial intermediaries with different roles in the economy. Savings and investment spending are interdependent, and interest rates are determined in the loanable funds market.

a. What are the roles of financial intermediaries and loanable funds market in promoting long-run economic growth? How do financial intermediaries link saving and investment?

b. How does government borrowing crowd out investment? What is the relationship between government borrowing and budget deficits?

Solution Preview :

Prepared by a verified Expert
Microeconomics: What is the relationship between economic growth and
Reference No:- TGS01165028

Now Priced at $20 (50% Discount)

Recommended (96%)

Rated (4.8/5)