Question 1

Suppose over the last year that the price of iron ore increased from $1,200 a ton to $1,275 a ton. Over the same time a measure of the overall price level increased from 150 to 156. The price of iron ore increased by

Accepted Answer

A)   less than inflation, so it became less scarce.
B)   less than inflation, so it became more scarce.
C)   more than inflation, so it became more scarce.
D)   more than inflation, so it became less scarce.E) B) and D)
F) A) and C)

Question 2

In 2010, the typical Bangladeshi had about

Accepted Answer

A)   less than half the real income of a typical American a century ago.
B)   about the same real income of a typical American a century ago.
C)   2 times as much real income as that of a typical American a century ago.
D)   4 times as much real income as that of a typical American a century ago.E) C) and D)
F) All of the above

Question 3

Which of the following provide benefits to society at large and not just to the persons)  who pursues it?

Accepted Answer

A)   both technological knowledge that is a public good and education
B)   technological knowledge that is a public good, but not education
C)   education, but not technological knowledge that is a public good
D)   neither education, nor technological knowledge that is a public goodE) A) and B)
F) B) and C)

Question 4

Nathan owns a bakery that bakes only cakes. All of his bakers work 8 hours per day. In 2011, he employed 5 bakers who produced a total of 200 cakes each day. In 2012, he employed 6 bakers who produced a total of 249 cakes each day. The bakery's productivity

Accepted Answer

A)   decreased by 2.33%.
B)   increased by 2.33%.
C)   increased by 3.75%.
D)   increased by 24.50%.E) B) and C)
F) C) and D)

Question 5

Which well­known economist from the past asserted that "the power of population is infinitely greater than the power in the earth to produce subsistence for man?"

Accepted Answer

The econom...

Question 6

All else equal, if there are diminishing returns, then if a country raised its capital by 100 units last year and by 100 units this year,

Accepted Answer

A)   the increase in output was greater for this year than last year.
B)   the increase in output was greater last year than this year.
C)   the increase in output is the same in both years.
D)   None of the above is necessarily correct.E) All of the above
F) A) and B)

Question 7

Both the standard of living and the growth of real GDP per person vary widely across countries.

Accepted Answer

A) True 
 B)False

Question 8

Some economists argue that it is possible to raise the standard of living by reducing population growth. As an economist interested in incentives rather than coercion, what kind of policy would you recommend to slow population growth?

Accepted Answer

Since bearing a child has an opportunity...

Question 9

In 2010, the imaginary nation of Bovina had a population of 5,000 and real GDP of 600,000. In 2011 it had a population of 5,200 and real GDP of 636,480. During 2011 real GDP per person in Bovina grew by

Accepted Answer

A)   2 percent, which is high compared to average U.S. growth over the last one-hundred years.
B)   2 percent, which is about the same as average U.S. growth over the last one-hundred years.
C)   4 percent, which is high compared to average U.S. growth over the last one-hundred years.
D)   4 percent, which is about the same as average U.S. growth over the last one-hundred years.E) All of the above
F) None of the above

Question 10

Fretonia and Libstien are the same except Fretonia has a larger capital stock. Both countries undertake policies that raise their saving rates to the same higher level. We would expect that

Accepted Answer

A)   both countries would have permanent increases in their growth rates, but the increase would initially be larger in Fretonia.
B)   both countries would have permanent increases in their growth rates, but the increase would initially be smaller in Fretonia.
C)   both countries would have temporary increases in their growth rates, but the increase would be larger in Fretonia.
D)   both countries would have temporary increases in their growth rates, but the increase would be smaller in Fretonia.E) A) and C)
F) B) and C)

Question 11

The notion that our ability to conserve natural resources is growing more rapidly than their supplies are dwindling is supported by the fact that

Accepted Answer

A)   most economists do not regard the availability of natural resources as a determinant of productivity.
B)   the quantity of natural resources does not enter into any production function.
C)   inflation-adjusted prices of most natural resources have been stable or fallen over time.
D)   inflation-adjusted prices of most natural resources have risen over time.E) None of the above
F) B) and C)

Question 12

If a country's saving rate declined, then other things the same, in the long run the country would have

Accepted Answer

A)   lower productivity, but not lower real GDP per person.
B)   lower productivity and lower real GDP per person.
C)   lower real GDP per person, but not lower productivity
D)   neither lower productivity nor lower real GDP per person.E) All of the above
F) B) and C)

Question 13

In order for the standard of living within a country to be enhanced over time, which of the following is essential?

Accepted Answer

A)   The role of the country's government in the economy must become larger.
B)   The population of the country must increase.
C)   More domestic natural resources must be discovered and used.
D)   The level of productivity must increase.E) A) and B)
F) C) and D)

Question 14

The logic behind the catch-up effect is that

Accepted Answer

A)   workers in countries with low incomes will work more hours than workers in countries with high incomes.
B)   the capital stock in rich countries deteriorates at a higher rate because it already has a lot of capital.
C)   new capital adds more to production in a country that doesn't have much capital than in a country that already has much capital.
D)   None of the above is correct.E) A) and D)
F) A) and B)

Question 15

Some data that at first might seem puzzling: The share of GDP devoted to investment was similar for the United States and South Korea from 1960-1991. However, during these same years South Korea had a 6 percent growth rate of average annual income per person, while the United States had only a 2 percent growth rate. If the saving rates were the same, why were the growth rates so different?

Accepted Answer

The explanation is based on the concept ...

Question 16

An increase in capital will increase real GDP per person

Accepted Answer

A)   more in a poor country than a rich country. The increase in real GDP per person will be larger if the addition to capital is from domestic rather than foreign investment.
B)   more in a poor country than a rich country. The increase in real GDP per person will be the same whether the addition to capital is from domestic or foreign investment.
C)   less in a poor country than a rich country. The increase in real GDP per person will be larger if the addition to capital is from domestic rather than foreign investment.
D)   less in a poor country than a rich country. The increase in real GDP per person will be the same whether the addition to capital is from domestic or foreign investment.E) B) and D)
F) B) and C)

Question 17

Productivity can be computed as the number of hours worked divided by output.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following is true?

Accepted Answer

A)   Kremer argued that with greater population, society would generate more ideas so that growth of real GDP per person could continue. Malthus argued that increasing population would outstrip agricultural production.
B)   Kremer argued that increases in population would reduce the amount of human and physical capital per worker so that eventually the standard of living would decline. Malthus argued that increases in technology would allow increased output growth so that even with population growth, society would enjoy a higher standard of living.
C)   Malthus argued that with greater population, society would generate more ideas so that growth of real GDP per person could continue. Kremer argued that increasing population would outstrip agricultural production.
D)   Malthus argued that increases in population would reduce the amount of human and physical capital per worker so that eventually the standard of living would decline. Kremer argued that increases in technology would allow increased output growth so that even with population growth, society would enjoy a higher standard of living.E) C) and D)
F) All of the above

Question 19

Which of the following is indicated by the data on real income per person for various countries over the past 100 or so years?

Accepted Answer

A)   If, in a relatively poor country, real income per person had grown by 3.5 percent per year for the last 100 years, it would be a relatively rich country today.
B)   Rich countries became richer and poor countries became poorer.
C)   In the United States, real income per person today is about four times as high as it was 120 years ago.
D)   All of the above are correct.E) C) and D)
F) B) and D)

Question 20

A country experiencing a growth rate of 12% per year can go from being one of the poorest to one of the richest in how many generations?

Accepted Answer

A)   one
B)   two
C)   three
D)   fourE) B) and D)
F) C) and D)

Exam 17: Production and Growth

In 2010, the typical Bangladeshi had about

Correct Answer
verified

Nathan owns a bakery that bakes only cakes. All of his bakers work 8 hours per day. In 2011, he employed 5 bakers who produced a total of 200 cakes each day. In 2012, he employed 6 bakers who produced a total of 249 cakes each day. The bakery's productivity

Correct Answer
verified

Which of the following is indicated by the data on real income per person for various countries over the past 100 or so years?

Correct Answer
verified

In 2010, the imaginary nation of Bovina had a population of 5,000 and real GDP of 600,000. In 2011 it had a population of 5,200 and real GDP of 636,480. During 2011 real GDP per person in Bovina grew by

Correct Answer
verified

Which wellknown economist from the past asserted that "the power of population is infinitely greater than the power in the earth to produce subsistence for man?"

Correct Answer
verified
The econom...
View Answer

The notion that our ability to conserve natural resources is growing more rapidly than their supplies are dwindling is supported by the fact that

Correct Answer
verified

Which of the following is true?

Correct Answer
verified

All else equal, if there are diminishing returns, then if a country raised its capital by 100 units last year and by 100 units this year,

Correct Answer
verified

Productivity can be computed as the number of hours worked divided by output.

Correct Answer
verified

If a country's saving rate declined, then other things the same, in the long run the country would have

Correct Answer
verified

Fretonia and Libstien are the same except Fretonia has a larger capital stock. Both countries undertake policies that raise their saving rates to the same higher level. We would expect that

Correct Answer
verified

Some economists argue that it is possible to raise the standard of living by reducing population growth. As an economist interested in incentives rather than coercion, what kind of policy would you recommend to slow population growth?

Correct Answer
verified
Since bearing a child has an opportunity...
View Answer

Both the standard of living and the growth of real GDP per person vary widely across countries.

Correct Answer
verified

The logic behind the catch-up effect is that

Correct Answer
verified

An increase in capital will increase real GDP per person

Correct Answer
verified

A country experiencing a growth rate of 12% per year can go from being one of the poorest to one of the richest in how many generations?

Correct Answer
verified

Which of the following provide benefits to society at large and not just to the persons) who pursues it?

Correct Answer
verified

Correct Answer
verified
The explanation is based on the concept ...
View Answer

Suppose over the last year that the price of iron ore increased from $1,200 a ton to $1,275 a ton. Over the same time a measure of the overall price level increased from 150 to 156. The price of iron ore increased by

Correct Answer
verified

In order for the standard of living within a country to be enhanced over time, which of the following is essential?

Correct Answer
verified

Exam 17: Production and Growth

In 2010, the typical Bangladeshi had about

Correct AnswerverifiedShow Answer

Nathan owns a bakery that bakes only cakes. All of his bakers work 8 hours per day. In 2011, he employed 5 bakers who produced a total of 200 cakes each day. In 2012, he employed 6 bakers who produced a total of 249 cakes each day. The bakery's productivity

Correct AnswerverifiedShow Answer

Which of the following is indicated by the data on real income per person for various countries over the past 100 or so years?

Correct AnswerverifiedShow Answer

In 2010, the imaginary nation of Bovina had a population of 5,000 and real GDP of 600,000. In 2011 it had a population of 5,200 and real GDP of 636,480. During 2011 real GDP per person in Bovina grew by

Correct AnswerverifiedShow Answer

Which well­known economist from the past asserted that "the power of population is infinitely greater than the power in the earth to produce subsistence for man?"

Correct AnswerverifiedThe econom...View AnswerShow Answer

The notion that our ability to conserve natural resources is growing more rapidly than their supplies are dwindling is supported by the fact that

Correct AnswerverifiedShow Answer

Which of the following is true?

Correct AnswerverifiedShow Answer

All else equal, if there are diminishing returns, then if a country raised its capital by 100 units last year and by 100 units this year,

Correct AnswerverifiedShow Answer

Productivity can be computed as the number of hours worked divided by output.

Correct AnswerverifiedShow Answer

If a country's saving rate declined, then other things the same, in the long run the country would have

Correct AnswerverifiedShow Answer

Fretonia and Libstien are the same except Fretonia has a larger capital stock. Both countries undertake policies that raise their saving rates to the same higher level. We would expect that

Correct AnswerverifiedShow Answer

Some economists argue that it is possible to raise the standard of living by reducing population growth. As an economist interested in incentives rather than coercion, what kind of policy would you recommend to slow population growth?

Correct AnswerverifiedSince bearing a child has an opportunity...View AnswerShow Answer

Both the standard of living and the growth of real GDP per person vary widely across countries.

Correct AnswerverifiedShow Answer

The logic behind the catch-up effect is that

Correct AnswerverifiedShow Answer

An increase in capital will increase real GDP per person

Correct AnswerverifiedShow Answer

A country experiencing a growth rate of 12% per year can go from being one of the poorest to one of the richest in how many generations?

Correct AnswerverifiedShow Answer

Which of the following provide benefits to society at large and not just to the persons) who pursues it?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedThe explanation is based on the concept ...View AnswerShow Answer

Suppose over the last year that the price of iron ore increased from $1,200 a ton to $1,275 a ton. Over the same time a measure of the overall price level increased from 150 to 156. The price of iron ore increased by

Correct AnswerverifiedShow Answer

In order for the standard of living within a country to be enhanced over time, which of the following is essential?

Correct AnswerverifiedShow Answer

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Correct Answer
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Correct Answer
verified

Which wellknown economist from the past asserted that "the power of population is infinitely greater than the power in the earth to produce subsistence for man?"

Correct Answer
verified
The econom...
View Answer

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified
Since bearing a child has an opportunity...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified

Correct Answer
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Correct Answer
verified
The explanation is based on the concept ...
View Answer

Correct Answer
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Correct Answer
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