Second, market imperfection and inefficiency will occur which may lead to misallocation of resources which implies that some of the resources are not able to create the optimal level of production to meet the rise in demand.
Second, market imperfection and inefficiency will occur which may lead to misallocation of resources which implies that some of the resources are not able to create the optimal level of production to meet the rise in demand.Furthermore, the lack of perfect market information and lack of mobility in the distribution of resources and goods and services will mean that some groups of people in the economy may not be able to attain the resources and goods and services and thus, the problem of scarcity continues to prevail.Actual economic growth refers to the actualization or utilization of resources into products, contributing to the growth of production capacity.Tags: Trigonometry Solved Problems Trigonometric EquationsTeamwork In College EssaysPlan Of BusinessEssay Of Internet CensorshipArgument Essay TipsCause And Effect Essay Rubric
The increase in production of more goods and services will mean that it is possible to satisfy the increasing demand brought about by rise in population and affluence of the society.
Expansion of production capacity is made possible as some countries can increase their productivity and engage in trade to increase their consumption possibility.
Initial low levels of inequality are associated with more negative elasticities of poverty reduction concerning growth.
Higher initial inequality results in less effect on poverty with an increase in economic growth.
Application of the concept of opportunity cost is required to answer this essay question.
Economic growth refers to the growth of the resource and production capacity which is measured in actual or potential capacity.This will allow the economy to raise production from one level to another without comprising the production of another good.Expansion of resource capacity is made possible when the economy can import resources from other countries or raise the rate of utilization of resources more efficiently to reduce wastage.Economic growth in an economy is demonstrated by an outward shift in its Production Possibility Curve (PPC).Another way to define growth is the increase in a country’s total output or Gross Domestic Product (GDP). A country’s economic development is usually indicated by an increase in citizens’ quality of life.In conclusion, it must be noted that the problem of scarcity can never be eradicated as long as wants are unlimited and resources are limited but a short term rise in economic growth will enable the increase in production will help to alleviate the problem of scarcity.What is the difference between Economic Growth and Development?However, when we take a longer and dimensional discussion of the issue, it is quite impossible to eliminate the problem of scarcity when there is economic growth.First, it is difficult to reduce the unlimited wants that are created by growth in population and greater affluence of the society as developing countries like India and China attain higher level of income.Lastly, economic growth will not solve the problem of scarcity as long as the production has not attained pareto optimality whereby there is an increase in production of one goods without the reduction in another good.In the economic production condition where opportunity cost occurs when production of increases, the problem of scarcity will still exist.