Why do environmentalists worry about faster economic growth? Economists concede that faster growth is not always better. Why?
What will be an ideal response?
Environmentalists worry that the sheer increase in the volume of goods imposes enormous costs on society in the form of crowding, pollution, global climate change, and proliferation of wastes that need disposal.Economists concede that faster growth is not always better. An economy that grows too fast may generate inflation. Inflation rises when aggregate demand races ahead of aggregate supply. An economy will become inflationary when people’s demands for goods and services expand faster than its capacity to produce them. So we probably do not want to grow faster than the growth rate of potential GDP, at least not for long.
You might also like to view...
The quantity produced in a monopolistically competitive market is ________ than the quantity produced in a perfectly competitive market, and the price charged in a monopolistically competitive market is ________ than the price charged in a perfectly
competitive market. A) higher; higher B) lower; higher C) higher; lower D) lower; lower
Economic growth in Latin America between 1960 and 2011 is best summarized as
A) a remarkable success. B) an abject failure. C) a mixed record. D) a noteworthy attempt.
In a certain country, it takes five of its 10workers to produce one barrel of wine butonly one worker to produce 1 yard ofcloth. If we graphed this country's PPF(placing wine on the vertical axis andcloth on the horizontal axis), the slope ofthe PPF would equal –1/5.
Answer the following statement(s) true (T) or false (F)
Which of the following is the best example of a person NOT having clear property rights?
A. a city parks worker who inherits his uncle's town house B. a dairy farmer who pays off the mortgage on his farm C. a medical student who lives on campus for his first year of studies D. a retired college professor who builds a bungalow on her oceanfront property