International Business Economics Essay Example | Topics and Well Written Essays - 4000 words

International Business Economics - Essay Example Thus, economic growth can be measured in nominal terms by taking into concern the factors like inflation and other economic indicators (Barro & Sala-i-Martin, 2004). Economic growth is usually calculated in real terms to eliminate the changing effect of inflation on the price of total goods produced. Whenever, one examines the modern economy and traditional development, the process of growth in an economy can also be identified at large. Identifiably, traditional economists have attempted to develop certain theories based on which the economic growth can be examined. This can be substantiated with reference to the fact that without the support of agriculture, industrialisation economic revolution cannot be made possible. The percent rate of increase in real Gross Domestic Product or GDP is measured as economic growth. The growth ratio of GDP is therefore called as per capita income. GDP growth indicates the increase rate in inputs such as capital, population or territory, which is known as extensive growth. On the other hand, an increase in growth caused by more efficient use of inputs is referred as intensive growth (Tahvonen, 2000). Based on the study of economics, one of the issues relating to international business economics i.e. â€Å"Economic Growth† typically refers to the growth of probable outputs like production at full employment in every field. Economic growth is generally eminent from the development in the sphere of economics. Meanwhile, economic growth is measured as the annual percent of GDP. Justifiably, GDP measures the market economy, which tends to exaggerate growth during the change from farming economy to household production. It is worth mentioning that the study of macro economics has a strong interrelation with economic growth, as it is fundamentally based on growth of agriculture and industrial production among others (Barro & Sala-i-Martin,