Economic growth in country X will occur if
[UPSC Civil Services Exam – 2013 Prelims]
(a) there is technical progress in the world economy
(b) there is population growth in X
(c) there is capital formation in X
(d) the volume of trade grows in the world economy
Answer: (c)
Explanation:
- The economic growth of any country results in a healthy and wealthy nation.
- Economic Growth means the increase in the level of GDP of the country.
- It can be possible only when all the factors of production are applied in the right manner i.e. land, labor, capital, and entrepreneurship.
- The capital formation in any country boosts its development as investment activities increases resulting in high production, increase in per-capita income, employment generation, the standard of living, poverty reduction, etc. Hence option 3 is correct.
