Macroeconomics

‭Point X to point Y:‬ ‭economic expansion‬ ‭Point Y to point Z:‬ ‭economic growth‬

‭Economic Growth on the AD-AS Model‬ ‭Since‬‭the‬‭long-run‬‭aggregate‬‭supply‬‭curve‬‭(LRAS)‬‭is‬‭vertical‬‭at‬‭the‬‭full‬‭employment‬‭level,‬‭and‬‭economic‬ ‭growth‬‭represents‬‭an‬‭increase‬‭in‬‭the‬‭full‬‭employment‬‭level‬‭of‬‭output,‬ ‭economic‬‭growth‬‭on‬‭the‬‭AD-AS‬ ‭model is illustrated by a rightward shift of the LRAS curve‬ ‭.‬

‭C. Sources of Economic Growth‬

‭Factors‬ ‭that‬ ‭affect‬‭an‬‭economy’s‬‭capacity‬‭to‬‭produce‬‭impact‬‭the‬‭rate‬‭of‬‭economic‬‭growth,‬‭and‬‭include‬ ‭the following:‬ ‭●‬ ‭The‬ ‭Quantity‬ ‭and‬ ‭Quality‬ ‭of‬ ‭Natural‬ ‭Resources:‬ ‭The‬ ‭discovery‬‭of‬‭new‬‭resources,‬‭such‬‭as‬‭oil‬ ‭felds‬ ‭and‬ ‭other‬ ‭vital‬ ‭sources‬ ‭of‬ ‭energy,‬ ‭can‬ ‭transform‬ ‭a‬ ‭nation‬ ‭into‬ ‭an‬ ‭exporter‬ ‭of‬ ‭these‬ ‭resources‬ ‭and‬ ‭enhance‬ ‭the‬ ‭output‬ ‭of‬‭industries‬‭that‬‭rely‬‭on‬‭them.‬‭Recall‬‭that‬‭discovering‬‭new‬

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