How to determine economic growth

The current indicator characterizing the situation in the country is economic growth. It is due to an increase in the Gross National Product per capita of the country, as well as an increase in production capacity.

Instruction manual

1

There are two ways to measure economic growth. The first is a measurement using the annual growth of the total national product. The second - through an increase in the rate of net national product.

2

Set the path of economic growth, namely: extensive or intensive. With the extensive growth path, there is an increase in the volume of labor attraction for the production process. Due to this, there is an increase in labor force employment, thereby reducing the overall rate of unemployment in the country. With the extensive path, there is also an increase in the volume of production, due to the fact that the number of employed people is increasing. Thus, the labor force of people is aimed at the production and sale of goods or services.

3

To increase output, a greater number of production fixed assets, tangible and intangible resources are spent. Consequently, there will be an increase in the development and production of new natural resources for their further implementation in the production process. As a result of economic growth through an extensive path, investment growth is increasing to finance increased production. With an intensive growth path, there is an increase in the efficiency of using production resources, and not their volume, as with the extensive method. Due to the increase in production efficiency, there is a further increase in the quality of labor, as well as manufactured goods or services.

4

Calculate measures of economic growth. These include: growth rate, growth rate and growth rate. The growth factor 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%.