Defining Economic Growth

Steps:

• Recall the standard definition: Economic growth is the expansion of an economy's ability to produce goods and services over time.
• Evaluate option A: Inflation reduction affects price stability, not output growth.
• Evaluate option B: Exports influence trade balance but not overall productive capacity.
• Evaluate option C: Population growth impacts demand but not necessarily production efficiency.
• Select option D: It matches the core definition of increased productive capacity.

Why D is correct:

• Economic growth is defined as an increase in real GDP, reflecting higher productive capacity through more resources, technology, or efficiency.

Why the others are wrong:

• A: Reduces prices but does not expand production.
• B: Boosts trade but ignores domestic output changes.
• C: Affects workforce size but not productivity per person.

Final answer: D