Macro CH 6 HW - Jackie Patterson Macroeconomics HW Chapter...

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Jackie Patterson Macroeconomics HW Chapter Six Home-Work 2. Consider a nation in which the volume of goods and services is growing by 5% per year. What is the likely impact of this high rate of growth on the power and influence of its government relative to other countries experiencing slower rates of growth? What about the effects of this 5% growth on the nation’s living standards? Will these also necessarily grow by 5% per year given population growth? Why or why not? With economic growth comes money and with money comes luxuries and to create luxuries you need money, therefore the government could possibly raise taxes with the rising economic growth to boost the overall function and quality of life of the nation, where as governments of countries that do not have economic do not have these opportunities to better the nation. Standards of living and economic growth go hand-in-hand; economic growth creates jobs, stimulates the economy, creates a sense of value in the nation, and changes the overall view of life from generation to generation. Most countries in the world have experienced an industrial revolution and those that have not are mainly 3
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This note was uploaded on 08/02/2010 for the course MACRO 201 taught by Professor Smith during the Spring '10 term at Northern Virginia Community College.

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Macro CH 6 HW - Jackie Patterson Macroeconomics HW Chapter...

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