Economic Growth Economic growth refers to the rate of increase in the total production of goods and services within an economy. Economic growth increases the productivity capacity of an economy, thereby making it possible to satisfy more wants. A growing economy increases job opportunities, stimulates enterprise and innovation. Sustained economic growth is fundamental for any nation wishing to raise its standard of living and ensure greater well-being for all. Gross domestic product (GDP) is the monetary value of all final goods and services produced in a year. It is the total value of production within the economy. Total value of production is the total value of final goods or services minus the cost of purchased intermediate goods. GDP at market prices (nominal GDP) measures the value of total output at the current price level. That is, GDP at market prices measures both the total physical volume of goods and services produced and the prices at which these goods and services are sold. GDP at market prices is extremely useful for measuring growth rates and the relative importance of different industries or sectors within the economy. The method of measuring GDP at market prices is implied by the following formula: [(current year quantity) x (current year price)]. However, GDP at constant prices is the most common method of measuring economic growth. GDP at constant prices excludes the effect of price changes and allows f...