top of page

Economics explained


Economic growth

Potential economic growth

Potential economic growth

The secret to scoring awesome grades in economics is to have corresponding awesome notes.
A common pitfall for students is to lose themselves in a sea of notes: personal notes, teacher notes, online notes textbooks, etc... This happens when one has too many sources to revise from! Why not solve this problem by having one reliable source of notes? This is where we can help.
What makes TooLazyToStudy notes different?
Our notes:
  • are clear and concise and relevant
  • is set in an engaging template to facilitate memorisation
  • cover all the important topics in the O level, AS level and A level syllabus
  • are editable, feel free to make additions or to rephrase sentences in your own words!

    Looking for live explanations of these notes? Enrol now for FREE tuition!

Potential economic growth is the rate at which the economy would grow if all resources (eg people and machinery) were utilised.

The causes of growth in potential output are the determinants of the capacity of the economy (the supply side) rather than actual spending (the demand side), and are as follows.

There may be increases in the amount of resources available.

For example, new natural resources are continually may be discovered or the size of the working population may increase.

Increases in the productivity of resources may result from technological progress or changed labour practices, for example.

Potential economic growth can be shown using both a production possibility curve and an AD/AS diagram.

Both diagrams illustrate an increase in the maximum output the economy is capable of producing. For potential economic growth to lead to higher output, the rise in productive potential must be utilised.

bottom of page