An economy experiences a persistent increase in real Gross Domestic Product (GDP) accompanied by a structural shift from low-productivity agriculture to high-value industrial production, improved literacy rates, and reduced poverty levels. How is this total economic transformation best classified?
- Economic development, because it combines quantitative national income expansion with qualitative structural improvements in living standards.Answer
- BEconomic growth, because it involves an increase in real gross domestic product and total industrial output over time.
- CEconomic growth only, since structural changes and improvements in literacy are automatic consequences of national income expansion.
- DEconomic planning, because structural shifts across sectors occur exclusively through centralized government intervention.
Answer
Economic development, because it combines quantitative national income expansion with qualitative structural improvements in living standards.
Economic development encompasses both quantitative expansion in real national income (growth) and qualitative structural transformations in society, such as sector modernization, poverty reduction, and improved literacy levels.
Step-by-Step Solution
Key Concept
Distinction Between Economic Growth and Economic Development
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