📊 GMAT Exam Prep

While early theories of economic growth emphasized capital accumulation and labor input, more contemporary analyses increasingly highlight the role of innovation and human capital development. These newer perspectives argue that sustainable long-term growth is less about merely increasing inputs and more about improving the efficiency and productivity with which those inputs are utilized, often through technological advancement and education. This shift in understanding has profound implications for policy-making, moving focus from direct investment to fostering an environment conducive to learning and creativity. The author's primary purpose in the passage is to:

A Argue against early theories of economic growth.
B Advocate for increased investment in technological advancement.
C Explain a change in the understanding of economic growth and its implications.
D Detail the various factors contributing to sustainable long-term economic growth.

✓ Correct Answer: Option C

The passage explicitly discusses a 'shift in understanding' from older theories to 'more contemporary analyses' regarding economic growth and then elaborates on the 'profound implications' of this new perspective for policy.

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