The principle economic cost of growth is:

Question

Quizplus · Accepted Answer

Growth requires investment in capital goods such as factories, machinery, and infrastructure. This investment comes at the cost of current consumption as resources are diverted away from producing consumer goods. This sacrifice of consumption for the sake of investment is the principal economic cost of growth. Higher interest rates and inflation rates can be associated with growth, but they are not its principal economic cost. Investment in stocks and bonds is not necessarily a cost, but rather a means of financing growth.

The Principle Economic Cost of Growth Is