Defining Economic Growth

Steps:

• Recall the standard economic definition: growth measures a sustained increase in real output over time.
• Evaluate options against this: check if each aligns with rising GDP or production potential.
• Eliminate unrelated factors like inflation, trade, or demographics.
• Confirm the match with productive capacity as the core indicator.

Why D is correct:

• Economic growth is defined as an expansion in a nation's ability to produce goods and services, often measured by rising real GDP, which reflects increased productive capacity.

Why the others are wrong:

• A: Inflation reduction stabilizes prices but does not indicate output growth.
• B: Export increases boost trade but may not reflect overall domestic production.
• C: Population growth affects demand but not necessarily productive efficiency or output per capita.

Final answer: D