UPSC CSE Prelims
Question 5
Economic growth in country X will necessarily have to occur if
View correct answer and explanation
Correct answer: C
Correct Option: C
Explanation: Capital formation expands a country’s productive capital stock and is the intended growth driver among the listed domestic factors.
Option-wise Analysis:
A: Incorrect - Wrong: world technology does not automatically reach or benefit country X.
B: Incorrect - Wrong: more people can raise population without raising real output or output per person.
C: Correct - Correct in the exam’s framework: domestic investment in productive assets raises output capacity.
D: Incorrect - Wrong: growing world trade need not increase X’s own production.
Review Note: “Necessarily” is too absolute in economic theory: investment can be misallocated, depreciate or remain unused. Supplied C is the conventional exam answer, not a mathematical guarantee.