Merits and demerits of growth definition
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Answer:
Economic growth happened because of a few factors, one of them being technological progress. The increase in the productivity of technology can increase potential output by using the same amount of capital and employment (Sheffrin and Sullivan, 2006). When the economy has enough supply, consumers are able to spend more. Technological progress will also increase production efficiency as the cost of production is reduced. A scientific calculator was not able be produced a century ago, but 50 years ago, it could be produced with only very expensive machines, and today the calculator is available for only a few pounds (Anderton, 2008). The developed technology can produce a new and better quality of goods and this will increase the firm’s profit as consumers are attracted to purchase those products. Hence, with those extra spending, there would be economic growth.