How can the Government improve economic growth/real GDP of a country?

Definition mark: Economic growth is the increase in real GDP 

Explanation: 

Government can use two ways of increasing economic growth; supply side policies and fiscal policies. 

point 1: Providing subsidies to schools to improve quality of education. Improving education quality will result in more students gaining more skills and becoming more employable. More productivity of people and more jobs results in increase production of goods, therfore an increase in real output will increase exports and therfore more injections into the circular flow of income will increasr the country's GDP and hence there will be economic growth. 

Evaluation: However, it depends on the elasticity of the goods. If the good is inelastic such as oil than the exports will continue to be high and thus increaing economic growth for the country. 

Point & Evaluation x3

Conclusion 

=30 marks 

Answered by Akshay D. Economics tutor

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