Economic Growth

A detailed Summary of Economic Growth

The government's objective of sustainable economic growth seeks to achieve consistent economic growth at around 4-4.5%; avoiding both the excessive growth likely to damage the goals of price stability and equity and also avoiding insufficient growth that is likely to result in increased unemployment, lower living standards and inequity.

The most common method of measuring economic growth is the chain volume measure of GDP (Gross Domestic Product). The GDP measures the total market value of good and services produced in Australia. Basically growth is determined by the change in GDP.

The GDP is, at best, an indication of economic growth. It relies on a series of guesses and estimation. There are several elements that are not included by the GDP, some examples are:

· All non-market activity is excluded from the GDP (black market activity, cash changing hands, home repairs and gardening etc all fall in this category).

· Imputed production- where the amount generated by the service must be estimated (for example, the value of government services).

· Quality increases are not reflected by the GDP. When quality increases and prices decrease, that is reported as a loss in our well-being.

Australia's GDP growth has averaged around 4.3 per cent a year over the past five years, outperforming all other key economies, including the US, Japan, Germany and the UK. The Westpac Bank predicts a 1.9% GDP for the 00/01 financial year. This slow economic growth is as a result of international pressure from a global slowdown and recessions in several of our key economic partners as well as the aftermath of September 11. After this setback growth is tipped to reach 3.9% in the 01/02 financial year before increasing further to 4.2% in 02/03 and back to a more conservative 3.2% in 03/04. In the short-term future, the predictions are for business investment to increase as well as exports.

Year GDP $m GDP per capita Growth % Per capita growth Growth rounded PC growth rounded

Economic Growth and External Stability

Some common words found in the essay are:
ECONOMIC GROWTH, GDP GDP, DATA GDP, Price Stability, DEMAND FACTORS, Westpac Bank, Stability Normally, SUPPLY FACTORS, economic growth, Australia's GDP, Product GDP, consumer confidence, gdp capita, business confidence, price stability, chain volume measure, capita growth, domestic product, external stability, chain volume, favourable supply-side, economy productive capacity, consumer confidence recession, business consumer confidence, economic growth propelled,

Approximate Word count = 1046
Approximate Pages = 4 (250 words per page double spaced)

Category: Miscellaneous

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Economic Growth

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