Economic Growth Defined by Output Increase

Steps:

• Recall that economic growth measures a nation's ability to produce more goods and services over time.
• Identify key indicators like real GDP, which tracks output adjusted for inflation.
• Compare choices: Output (A) matches growth; demand (B) drives it but isn't the definition.
• Eliminate mismatches: Incomes (C) and prices (D) are outcomes, not core definitions.

Why A is correct:

• Economic growth is defined as a sustained increase in real output (e.g., real GDP) per capita or total, reflecting productive capacity expansion.

Why the others are wrong:

• B: Total demand increase describes aggregate demand shifts, not growth itself.
• C: Rising wages, interest, profits, and rent indicate income growth, a potential result but not the definition.
• D: Price level increase defines inflation, not economic growth.

Final answer: A