NIOS Board Class 12 Economics chapter 3: Economic Growth and Economic Development

**Introduction**

Economic growth and economic development are among the most significant subjects in modern economics. To understand the progress of any country, it is essential to determine whether that country is merely increasing its production or if it is also improving the standard of living of its people.

In today’s world, an increase in GDP alone is not sufficient. Rather, factors such as health, education, employment, equality, and human capital are equally important. This is precisely why it is absolutely crucial to understand the concepts of both economic growth and economic development.
**Short Questions and Answers**

**Q:** What is economic growth?

**Ans:** An increase in a country’s total production (GDP) or national income over a specific period is termed economic growth.

**Q:** What is the full form of GDP?

**Ans:**

Gross Domestic Product (Sakal Gharelu Utpad)

**Q:** What is economic development?

**Ans:**

When improvements in the standard of living, education, health, and employment occur alongside an increase in production, it is termed economic development.

**Q:** What is per capita income?

**Ans:** Per Capita Income = National Income / Total Population

**Q:** What is the main objective of economic development?

**Ans:** To improve the standard of living of the people.

**Q:**

What type of change is economic growth?

**Ans:** Quantitative

**Q:**

What type of change is economic development?

**Ans:** Qualitative + Quantitative

**Q:**

On what factors does the Human Development Index (HDI) depend?

**Ans:** ① Education

② Health

③ Life Expectancy

**Q:** What are India’s major economic problems?

**Ans:** Poverty and Unemployment

**Q:** Which are the developed countries?

**Ans:**

America, Britain, etc.

**Q:** Which is a developing country?

**Ans:**

India

**Q:** What is unemployment?

**Ans:**

Being willing to work but unable to find employment.

**Detailed Questions and Answers**

**Q:** What is the difference between economic growth and economic development? 30- Indicators of Economic Growth and Economic Development. Both economic growth and economic development reflect a country’s progress; however, they carry distinct meanings.

Economic Growth:

Economic growth refers to the progress of a country.

* In other words, while both economic growth and economic development indicate a nation’s progress, economic growth specifically refers to an increase in a country’s total output (GDP) or national income. Economic growth focuses solely on the aspect of production.

Example: If there is a 2% increase in output, this is termed an increase in economic growth.

Economic Development:

Economic development refers to overall progress; it occurs when, alongside an increase in production, there is also an improvement in people’s standard of living, education, health, and employment opportunities.

Q: What is the Human Development Index (HDI)?

30- The HDI (Human Development Index) is an index that indicates:

The extent of a country’s development—not solely on the basis of income—but rather on the basis of health, education, and standard of living.

The HDI report is prepared by the United Nations Development Programme (UNDP).

The HDI comprises three main components: (i) Health, (ii) Education, and

(iii) Income.