Measuring economic growth. The value of all goods and services produced in any year makes up a nation's gross domestic product. An economy's rate of growth is measured by the change in its gross domestic product over a period, usually year on year. In the period 1970 to 1988, the gross domestic products of different countries grew at widely different average rates, after adjustments were made for inflation. The following rates were achieved: the United Kingdom (UK) 2.2 per cent, the United States 2.9 per cent, Ireland 3.0 per cent, Australia 3.3 per cent, Canada 4.4 per cent, Malaysia 6.5 per cent, Singapore 8.0 per cent, and South Africa 9.2 per cent.

Another way of measuring a nation's economic growth is to study the standard of living of its people. To judge standard of living, economists sometimes divide a nation's total gross domestic product by its entire population. The resulting figure is called the per capita GNP. The per capita GNP of a nation is the value of goods and services each person would receive if all the goods and services produced in the nation that year were divided evenly among all the people.

4/- KINDS OF ECONOMIC SYSTEMS

Different economic systems have developed because nations have never agreed on how to solve their basic economic problems. Three important economic systems today are (1) capitalism, (2) mixed economies, and (3) Communism. The economies of many countries include elements from several different economic systems.

Capitalism is the economic system of many countries throughout the world. It is called capitalism because an individual can own land and