Question

The day to day living conditions of today are much different than they were in the 20th century. Charlie, doing some web searching with StumbleUpon, discovers that more houses today (as compared to houses in the 20th century) have electricity (for his video games), air conditioning (which he is thankful for, since he lives in the sweltering heat of Texas) and a car (which allows him to go to cafes to study economics easily, because he is too lazy to ride his bike). What changed between the early twentieth century and present day that allowed this to happen? A. There were no market failures during this time. B. There has been economic growth in our society. C. The invisible hand has guided all nations around the world to this prosperity. D. There have been fewer recessions, allowing Americans to prosper and earn more money.

Answer 1

Answer: There has been an economic growth in our society.

Explanation: Economic growth refers to a situation when the individuals and firms in the economy gets more commodities for their consumption.

When economic growth occurs the capacity of the economy increases in respect of production. Hence the total production increases over time leading to high demand and supply in the market.

Thus, the more usage of commodities like car and air conditioners is an evidence of economic growth.