Define five types of possible net or overall effects

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(a) Define the five types of “production effects” of economic growth in a country. Other things equal, if one factor of production in a country (either labor or capital) grows, what are the only two types of production effects that are possible because of the growth in this factor? Briefly explain.

(b) Define the five types of “consumption effects” of economic growth in a country? Why can economists usually rule out two of these types when discussing likely possibilities in the “real-world” growth of countries?

(c) Define the five types of possible “net” or “overall” effects of the country’s growth on the importance of the trade sector and indicate which types would, other things equal, lead to a deterioration of the growing country’s terms of trade (assuming that the country is a “large” country).

Reference no: EM13893249

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