The correct answer is A.
Economic growth is defined as the increse experienced by a country's GDP from one period (year) to another.
The Gross Domestic Product (GDP) is the measure which agreggates the monetary value of all goods and services produced in an economy during a certain period of time, generally one year. This global figure is constituted by the following elements:
GDP = C + I + G + XN
where,
- C = household's consumption
- I = private investment
- G = public expenditure
- XN = net exports = exports - imports
The GDP is the result of adding these elements. Therefore, the larger the quantity of any of them, the larger the final GDP figure will be. If the GDP is larger, compared to a former period, there is economic growth.
