ECONOMICS
ECONOMIC GROWTH
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Both have high GDP and strong economies
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Both have low GDP and weak economies
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Both have good football clubs
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Both have terrible capital cities
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Detailed explanation-1: -Human capital is positively correlated to economic growth since investment tends to boost productivity. The process of educating a workforce is a type of investment, but instead of capital investment such as equipment, the investment is in human capital.
Detailed explanation-2: -In the long term, a larger physical capital stock increases the economy’s overall productive capacity, allowing more goods and services to be produced with the same level of labor and other resources.
Detailed explanation-3: -when countries invest in capital goods, they are providing better facilities, resources, and/or materials for the people who perform the labor, which creates a more productive workforce leading to greater economic growth (higher GDP).
Detailed explanation-4: -Why does investing in human capital make sense both on broad economic and individual scale? Investing in human capital makes sense both on broad economic and individual scale because human capital is a kind of capital that involves skills and gains knowledge by a worker.