Causes of Economiv Growth Essay

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Causes of Economic Growth Part 1: Economic growth means an increase in real GDP, meaning there is an increase in national output and national income. Economic growth is caused by two main factors: • An increase in mixed demand • An increase in mixed supply Economic growth is caused by improving the quantity and quality of the production that a country has available i.e. land, labor, capital and enterprise. If any of the production factors fails economic decline may occur. The Penn World Data sheet shows that within the 5 countries the Korean Republic has the highest investment share of CGDP of up to 30.7% during the year 2000. It has an increased GDP of 1561.4 from 1996 to 2000. Korea’s economic growth is fueled by the fact that there is such a high investment figure, meaning that more people use money in the market for investments. On the other hand Bulgaria’s GDP has declined by 108.7 due to a lack of money being invested in the markets. Part 2: Economic Growth of the 5 countries is a result of the following factors: • Investment share (a unit of ownership in a corporation, mutual fund, or limited partnership) • Literacy level (the % of people that are able to read and write in an area) • Technological advancements (recent technological developments in certain countries e.g. printing press, internet) Countries with high figures of investment shares such as the UK and Korea will often have a boosted economic growth due to rising GDP’s. Which tells us that these countries spend more money on the markets. Ghana has a very low GDP. It also has the lowest literacy level out of the 5 (UK, Korean Republic, Bulgaria, Iran, Ghana). Countries need a high literacy level so that there is more skilled workers in their country, because workers should have to be told what to do on the job, they are expected to know what to

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