Log out Go to App
Go to App

Learning Materials

Features

Discover

Chapter 17: Problem 6

How does discovering and implementing new ideas cause economic growth?

Short Answer

Expert verified
Discovery and implementation of new ideas result in innovation and higher productivity, which stimulate economic activities and cause economic growth.

Step by step solution

01

Understanding the Question

The exercise is about understanding the effect of innovative ideas on economic growth. It requires studying the concepts of 'discovery', 'implementation of new ideas', and 'economic growth'.
02

Defining Economic Growth

Economic growth refers to an increase in the production of goods and services in an economy over a certain period. It is typically measured as the percentage increase in Gross Domestic Product (GDP).
03

Concept of Discovery and Implementation of New Ideas

Discovery and implementation of new ideas translates into innovation. Innovation drives productivity, which is a key determinant of economic growth. Economies that innovate, introduce new technologies, ideas or methods, have higher productivity levels.
04

The Process

When firms in an economy discover and implement new ideas, they build new products, technologies, or methods of production. This leads to increased efficiency, output and productivity. These factors form the basis for economic growth.
05

Concluding the Connection

Discovery and implementation of new ideas lead to innovation and productivity increases, that subsequently cause economic growth. Hence, there is a direct link between the discovery and implementation of new ideas and economic growth.

Unlock Step-by-Step Solutions & Ace Your Exams!

  • Full Textbook Solutions

    Get detailed explanations and key concepts

  • Unlimited Al creation

    Al flashcards, explanations, exams and more...

  • Ads-free access

    To over 500 millions flashcards

  • Money-back guarantee

    We refund you if you fail your exam.

Start your free trial

Over 30 million students worldwide already upgrade their learning with Vaia!

One App. One Place for Learning.

All the tools & learning materials you need for study success - in one app.

Get started for free

Most popular questions from this chapter

What is the difference between business cycle macroeconomics and economic growth macroeconomics?

What does it mean to say that "a change in labor moves us along a given production function?"

Why might per-capita real economic growth be a more useful measurement than absolute real economic growth?

Why might special-interest groups favor transfer-promoting policies over growth-promoting policies?

What do interest rates and the tax treatment of returns to capital have to do with economic growth?
See all solutions

What do you think about this solution?

We value your feedback to improve our textbook solutions.

Study anywhere. Anytime. Across all devices.

Sign-up for free