Factors Affecting Economic Growth Quiz

Labor is a key factor of production, representing human effort and skill in the production process.

Economic growth is typically associated with a decrease, not an increase, in inflation rates.

In economics, capital refers to physical assets like machinery and tools used in the production of goods and services.

Technological progress plays a crucial role in driving long-term economic growth by improving efficiency and productivity.

Human capital includes attributes like education and skills, making educational attainment a clear example.

A higher savings rate usually leads to increased investment, fostering economic growth.

Technological progress is a long-term factor; in the short run, factors like demand and monetary policy play a more immediate role.

While important, educational institutions are typically considered human capital, not physical infrastructure affecting economic growth.

Entrepreneurship drives economic growth by fostering innovation, creating jobs, and enhancing productivity.

The Solow Growth Model is a tool used in economics to analyze and explain factors influencing long-term economic growth.

Technological advancement is a driving force behind economic growth, fostering innovation and efficiency.

The 'Catch-Up Effect' describes the tendency of less developed countries to grow at faster rates and catch up to more developed ones.

Higher levels of education contribute to economic growth by improving the skill set of the workforce and fostering innovation.

Foreign direct investment brings in capital and technology, stimulating economic growth in host countries.

Trade openness promotes economic growth by encouraging competition, innovation, and specialization.

Strong property rights provide incentives for investment and innovation, fostering economic growth.