I think that good grade is an incentive for diligent students who often engage themselves to studying hard to achieve that grade. For example when a student finds his friend to have received a commendable grade and is showered with praise and affections by his teacher, a desperate desire often creates in his subconscious mind. He also unknowingly wants to be like him and acquire the grade his friend has received. In this way, a healthy competition is often developed among all the fellow students who equally want to outshine the other by ameliorating their respective grades. In this way, they get to learn more and more things. In fact they often indulge themselves to extensive library works and other reference books and similar items from where they all seek to learn that extra little bit as compared to his friend. Good grades thus indirectly pave the way for the overall learning process of a student and help him to be more sound academically.
Secondly, these days competition has reached to a high extent and it has really become difficult for the faculties to winnow out the students. So the only option they are left with is Grade of a student which serves as a tool to select them for admission to a good and accredited school, college and university. Now when this grade becomes the decisive factor for a student to get admitted to a school, college or university they long for, they are also left with no other option but to increase their marks and improve their grades. Now in order to improve their grade the only way is to learn, learn and only learn. This learning process to meet their expected grade is