To measure economic growth, first the GDP is measured, that is, the market value of the final goods

and services produced in an economy during a specific time period. This nominal (market value) GDP is then adjusted to remove the effects of inflation, thus, converting the nominal value into real terms. The growth rate is then the difference between the real GDP in this time period and the real GDP in the previous time period, multiplied by 100 to express growth in a percentage form. Economic growth is certainly a part of the economic well being of a country. If economic growth is strong, employment will be healthier. High growth rates will generate more income. GDP per capita only provides an average income without revealing anything about income distribution To make accurate comparison of economic well being, other information could be considered. Such as current level of economic development, the distribution of income, the state of environment,leisure time, education levels, health levels, degree of corruption, the types of quality of goods and services being produced. The decrease in the unemployment rate and the increase in economic growth would be seen as good for the economy. However, these come with an increase in inflation. Remember the possible shifts of AD and AS in the AD-AS Model. If AD rises, there is more real GDP and more employment, but a higher price level.if AD decreases, there is less real GDP and less employment, but the price level will have decreased.this is partly good and bad. Whereas in increase in AS is good and good- more real GDP, more employment and a lower price level An increase in govt spending would increase AD, bringing out a higher level of real GDP and contributing to economic growth. The multiplier effect would mean that the actual increase in G would result in a larger amount of AD because of the flow on effects to the other components. A disadvantage of the increase in G and subsequent increase in AD is that the rate of inflation would most certainly have risen. Having placed the economy at or very near full employment, with AD intersecting AS almost on the classical range of the curve, if AD were to continue to increase demand-pull inflation would have occurred. Inflation carries with it possible economic costs, such as reducing real incomelevels. If the economy nearing current capacity levels, an increase in demand would have fuelled the demand for imports. The suggestion here is that the economy did not need any extra stimulation to AD by an increase in govt. spending.

The non determinant involved in the change in the coffee market is the change in input prices that has increased the production costs and thus decreased supply. The non-price determinant involved in the change in the tea market is the change in tastes and preferences that increased demand for tea Assuming tea and coffee are substitutes, the increase in the price of coffee would mean a decrease in the qty demanded for a coffee substitute (non-price determinant of demand;price of related goods) coffee drinkers could have expected that the increase in prices for coffee would make tea a cheaper option. However, as the article suggests, for different reasons the price of tea has also risen.