Economic growth is considered a topical indicator characterizing the situation in the country. It is due to an increase in the gross national product per capita of the country, as well as an increase in production capacity.
Instructions
Step 1
There are two ways to measure economic growth. The first is a measurement using the annual growth of the gross national product. The second is through an increase in the rate of the net national product.
Step 2
Establish the path of economic growth, namely, extensive or intensive. With an extensive path of growth, there is an increase in the volume of attracting labor to carry out the production process. Due to this, there is an increase in the employment of the labor force, thereby reducing the overall unemployment rate in the country. With an extensive path, there is also an increase in the volume of production, due to the fact that the number of the employed population increases. Thus, the labor force of people is aimed at the production and sale of goods or services.
Step 3
To increase the output of products, a greater amount of production fixed assets, material and non-material resources are spent. Consequently, there will be an increase in the development and extraction of new natural resources for their further introduction into the production process. As a result of economic growth through the extensive path, investment increases to finance the increased output. With the intensive path of growth, there is an increase in the efficiency of using production resources, and not their volume, as in the extensive method. Due to the increase in production efficiency, there is a further increase in the quality of labor, as well as the output of goods or services.
Step 4
Calculate indicators to measure economic growth. These include: growth rate, growth rate and growth rate. The growth rate is calculated as the ratio of the value of the indicator of the current period to the value of the indicator of the base period. Growth rate is defined as multiplying the growth rate by 100%. The growth rate is calculated as the difference between the growth rate and 100%.
