Chapter 19, Problem 1AA

To determine

To Discuss: The importance of Economic Growth under developing nation:

Explanation of Solution

The term economic growth refers to a situation where there is a steady increase in economic activities. As under developing nations, the economic activity growth relates to the rapid increase in the level of infrastructure, industrialization growth which leads to the development of new technology and ideas and increases in the level of gross domestic product, and thus it overall leads to economic growth.

Economic Growth and Developed Nation:

Under the developed nation the economic growth works effectively, as the developed nations are fully equipped, upgraded, and up-to-date factors help the economy to produce some innovative products and thus it increases foreign direct investment to take place. As the FDI invests under the developed nations, they will get better and upgraded technologies, which help them to produce faster and a shorter period of time.

Economic Growth and Developing Nation:

Under the developing nations, the condition of the economy is not fully utilized; the resources remain short, capital investment remains less, thus this result in the fall of per capita income and leads to a downward slope for gross domestic product. Thus under this economic growth is a must, as the developing nations grow faster and equip faster.

Economic Growth and Subsistence Agriculture:

The term subsistence agriculture is a situation where one particular nation wholly depends on the agriculture sector, as under this every citizen depends only on this particular sector, therefore it leads to the situation of scarcity, and thus economic growth under these sectors remains the priority.

Economic Growth and Infant Mortality Rate:

The economic growth and the infant mortality rate work opposite to each other, as the mortality refers to the situation of birth and death rate in the country, thus an increase in the economic growth leads to a decrease in infant mortality rate and a decrease in the economic growth leads to increase in infant mortality rate.

Economic Growth and Foreign Aid:

The term foreign aid is the main and important source of funding, and foreign aid is an important factor in the development of the economy. As if there is a slight increase in the foreign aid it leads to a rapid increase in gross national product and thus increases the level of economy and its product value.

Economic Growth and Economic Assistance:

Economic growth and economic assistance mean different but have the same effect. As economic assistance motives toward poor people growth and a group of society and on the other side the economic growth aims at developing the economy as a whole, thus both economic assistance and economic growth are important for development.

Economic Growth and Technical Assistance:

The economic growth under the technical assistance is also crucial as technology is the main source for economic growth, as the new techniques arise, it leads to better and fast production level and thus new techniques lead to skilled and experienced workers, thus it also hikes the employment level.

Economic Growth and Military Assistance:

The term military assistance refers to the situation where the resources are transferred from the developed countries to under-developed countries, thus under this sector, economic growth is a must because the economies' resources increase under military assistance. It increases the transferring of resources to under-developed countries.

Economic Growth and Bureaucracies:

The term bureaucracies refer where a people or group of people who are not the part of institutions but take part in meeting and every growth decision actively, thus as the level of bureaucracy increases it leads to downfall for economic growth, thus it is important to maintain the level of bureaucracies.

Economic growth and Capital Flight:

The term capital flights refer to the situation where the capital moves out of the country and thus results in the downfall of production rate, reduces the economic level, and thus decreases the gross domestic product of the country, as when the capital moves from one region to another, thus it increases the growth and efficiency level of another country.

Economic Growth and Five Year Plan:

The five-year plans are the most important reason for the development of economic activities, as these five years' plans are implemented continuously. Under this:

• The first plan focuses on the growth of food factors or to increase the agriculture sector.
• The second plan focuses on industrialization and the development of technologies.
• The third plan focuses on financial development and making the economy financially stable.
• The fourth plan focuses on self-growth, as acquiring a well stable job and thus contributing to economic growth.
• The fifth and the final plan focus on the growth of poor people and removing the level of poverty.