Question 1

Suppose that there are diminishing returns to capital.Suppose also that two countries are the same except one has less capital and so less real GDP per person.Suppose that both increase their saving rate from 3 percent to 4 percent.In the long run

Accepted Answer

A)   both countries will have permanently higher growth rates of real GDP per person,and the growth rate will be higher in the country with more capital.
B)   both countries will have permanently higher growth rates of real GDP per person,and the growth rate will be higher in the country with less capital.
C)   both countries will have higher levels of real GDP per person,and the temporary increase in growth in the level of real GDP per person will have been greater in the country with more capital.
D)   both countries will have higher levels of real GDP per person,and the temporary increase in growth in the level of real GDP per person will have been greater in the country with less capital.E) A) and B)
F) All of the above

Question 2

In 2007,Modern Electronics,Inc.produced 60,000 calculators,employing 80 workers,each of whom worked 8 hours per day.In 2008,the same firm produced 76,500 calculators,employing 85 workers,each of whom worked 10 hours per day.Between 2007 and 2008,productivity at Modern Electronics

Accepted Answer

A)   decreased by 4.00 percent.
B)   remained constant.
C)   increased by 8.33 percent.
D)   increased by 27.50 percent.E) C) and D)
F) None of the above

Question 3

International data on the history of real GDP growth rates shows that over the last 100 years or so,rich countries got richer and poor countries got poorer.

Accepted Answer

A) True 
 B)False

Question 4

In addition to investment in physical and human capital,what other public policies might a country adopt to increase productivity?

Accepted Answer

In addition to investment in physical an...

Question 5

In a market economy,we know that a resource has become scarcer when

Accepted Answer

A)   its price rises relative to other prices.
B)   it is non-renewable and some of it is used.
C)   people search for substitutes.
D)   All of the above are correct.E) B) and C)
F) A) and D)

Question 6

By saving more,a country

Accepted Answer

A)   has more resources for capital goods.The increase in capital raises productivity.
B)   has more resources for capital goods.The increase in capital reduces productivity.
C)   has fewer resources for capital goods.The decrease in capital raises productivity.
D)   has fewer resources for capital goods.The decrease in capital reduces productivity.E) B) and C)
F) B) and D)

Question 7

Which of the following countries achieved higher economic growth,in part by mandating a reduction in population growth?

Accepted Answer

A)   Great Britain
B)   China
C)   Australia
D)   FranceE) B) and C)
F) A) and D)

Question 8

The average amount of goods and services produced from each hour of a worker's time is called

Accepted Answer

A)   GDP.
B)   per capita GDP.
C)   productivity.
D)   technological knowledge.E) A) and D)
F) A) and C)

Question 9

Which of the following is correct?

Accepted Answer

A)   Once adjustment is made for inflation,the prices of most natural resources have been about steady or falling.
B)   Technological progress has allowed us to substitute renewable resources for some nonrenewable resources.
C)   Technological progress has made once-crucial natural resources less necessary.
D)   All of the above are correct.E) None of the above
F) B) and D)

Question 10

Suppose Japanese-based Sony Corporation builds and operates a new digital camera factory in the United States.Future production from such an investment would

Accepted Answer

A)   increase U.S.GNP more than it would increase U.S.GDP.
B)   increase U.S.GDP more than it would increase U.S.GNP.
C)   not affect U.S.GNP,but would increase U.S.GDP.
D)   have no affect on U.S.GNP or GDP.E) A) and C)
F) C) and D)

Question 11

Productivity is the

Accepted Answer

A)   key determinant of living standards,and growth in productivity is the key determinant of growth in living standards.
B)   key determinant of living standards,but growth in productivity is not the key determinant of growth in living standards.
C)   not the key determinant of living standards,but growth in productivity is the key determinant of growth in living standards.
D)   not the key determinant of living standards,and growth in productivity is not the key determinant of growth in living standards.E) A) and B)
F) A) and D)

Question 12

Which of the following best states economists' understanding of the facts concerning the relationship between natural resources and economic growth?

Accepted Answer

A)   A country with no or few domestic natural resources is destined to be poor.
B)   Differences in natural resources have virtually no role in explaining differences in standards of living.
C)   Some countries can be rich mostly because of their natural resources and countries without natural resources need not be poor,but can never have very high standards of living.
D)   Abundant domestic natural resources may help make a country rich,but even countries with few natural resources can have high standards of living.E) B) and C)
F) A) and B)

Question 13

In the United States real GDP per person is about $44,000,while in some poor countries real GDP per person is less than $3,000.

Accepted Answer

A) True 
 B)False

Question 14

The president of Improvia,a developing country,proposes that his country needs to help domestic firms by imposing trade restrictions.

Accepted Answer

A)   These are outward-oriented policies and most economists believe they would have beneficial effects on growth in Improvia.
B)   These are outward-oriented policies and most economists believe they would have adverse effects on growth in Improvia.
C)   These are inward-oriented policies and most economists believe they would have beneficial effects on growth in Improvia.
D)   These are inward-oriented policies and most economists believe they would have adverse effects on growth in Improvia.E) A) and B)
F) A) and C)

Question 15

Compare and contrast the population theories of Malthus and Kremer.

Accepted Answer

The difference is that Malthus predicted...

Question 16

Which of the following countries had the highest level of real GDP per person in 2006?

Accepted Answer

A)   Germany
B)   United Kingdom
C)   United States
D)   JapanE) A) and D)
F) A) and C)

Question 17

Over the last century,U.S.real GDP per person grew at a rate of about

Accepted Answer

A)   2 percent per year,so that it is now 2 times as high as it was a century ago.
B)   2 percent per year,so that it is now 8 times as high as it was a century ago.
C)   4 percent per year,so that it is now 2 times as high as it was a century ago.
D)   4 percent per year,so that it is now 8 times as high as it was a century ago.E) A) and B)
F) A) and C)

Question 18

Last year a country had 800 workers who worked an average of 8 hours and produced 12,800 units.This year the country had 1000 workers who worked an average of 8 hours and produced 14,000 units.This country's productivity was

Accepted Answer

A)   higher this year than last year.A possible source of this change in productivity is a change in the size of the capital stock.
B)   higher this year than last year.A change in the size of the capital stock does not affect productivity.
C)   lower this year than last year.A possible source of this change in productivity is a change in the size of the capital stock.
D)   lower this year than last year.A change in the size of the capital stock does not affect productivity.E) A) and B)
F) None of the above

Question 19

Roughly what percentage of growth in real GDP per person in Britain between 1790 and 1980 was accounted for by improved nutrition according to the estimates of Robert Fogel?

Accepted Answer

A)   30 percent
B)   20 percent
C)   10 percent
D)   5 percentE) C) and D)
F) B) and C)

Question 20

Although growth rates across countries vary some,rankings of countries by income remain pretty much the same over time.

Accepted Answer

A) True 
 B)False

Exam 25: Production and Growth

Productivity is the

Correct AnswerverifiedShow Answer

Although growth rates across countries vary some,rankings of countries by income remain pretty much the same over time.

Correct AnswerverifiedShow Answer

Suppose that there are diminishing returns to capital.Suppose also that two countries are the same except one has less capital and so less real GDP per person.Suppose that both increase their saving rate from 3 percent to 4 percent.In the long run

Correct AnswerverifiedShow Answer

Last year a country had 800 workers who worked an average of 8 hours and produced 12,800 units.This year the country had 1000 workers who worked an average of 8 hours and produced 14,000 units.This country's productivity was

Correct AnswerverifiedShow Answer

The average amount of goods and services produced from each hour of a worker's time is called

Correct AnswerverifiedShow Answer

Suppose Japanese-based Sony Corporation builds and operates a new digital camera factory in the United States.Future production from such an investment would

Correct AnswerverifiedShow Answer

International data on the history of real GDP growth rates shows that over the last 100 years or so,rich countries got richer and poor countries got poorer.

Correct AnswerverifiedShow Answer

In the United States real GDP per person is about $44,000,while in some poor countries real GDP per person is less than $3,000.

Correct AnswerverifiedShow Answer

Which of the following is correct?

Correct AnswerverifiedShow Answer

Which of the following best states economists' understanding of the facts concerning the relationship between natural resources and economic growth?

Correct AnswerverifiedShow Answer

Over the last century,U.S.real GDP per person grew at a rate of about

Correct AnswerverifiedShow Answer

Roughly what percentage of growth in real GDP per person in Britain between 1790 and 1980 was accounted for by improved nutrition according to the estimates of Robert Fogel?

Correct AnswerverifiedShow Answer

Compare and contrast the population theories of Malthus and Kremer.

Correct AnswerverifiedThe difference is that Malthus predicted...View AnswerShow Answer

In addition to investment in physical and human capital,what other public policies might a country adopt to increase productivity?

Correct AnswerverifiedIn addition to investment in physical an...View AnswerShow Answer

In a market economy,we know that a resource has become scarcer when

Correct AnswerverifiedShow Answer

The president of Improvia,a developing country,proposes that his country needs to help domestic firms by imposing trade restrictions.

Correct AnswerverifiedShow Answer

Which of the following countries had the highest level of real GDP per person in 2006?

Correct AnswerverifiedShow Answer

In 2007,Modern Electronics,Inc.produced 60,000 calculators,employing 80 workers,each of whom worked 8 hours per day.In 2008,the same firm produced 76,500 calculators,employing 85 workers,each of whom worked 10 hours per day.Between 2007 and 2008,productivity at Modern Electronics

Correct AnswerverifiedShow Answer

Which of the following countries achieved higher economic growth,in part by mandating a reduction in population growth?

Correct AnswerverifiedShow Answer

By saving more,a country

Correct AnswerverifiedShow Answer

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The difference is that Malthus predicted...
View Answer

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In addition to investment in physical an...
View Answer

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