(Bonus question: how does an economy stops growing? If it’s possible)
EDIT: Thank you all for your help. This is def more helpful and fun than good ol’ lessons.
In: Economics
These are pretty straightforward terms.
An economy experiences constant growth when the value of the stuff produced in a given amount of time continuously increases.
An economy in a steady state does not see the overall value of stuff produced change very much.
Economies grow principally due to two factors:
* An increase in people – More people can make more things out of more raw materials
* Innovation – People can think of new ways to use existing materials that are more valuable and productive than the old ways of doing them
An economy can stop growing for a lot of reasons. If I were going to boil them down to two very broad ideas they would be:
* Existing resources can be used inefficiently or be underutilized.
* The stock of resources used to produce things can decrease.
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