Exam 17: Economic Growth: Resources, Technology, Ideas, and Institutions

Exhibit 17-1 Production Function Real GDP = T (L, K), such that Real GDP = T(L + K) Assume that the technology coefficient is equal to 0.50. -Refer to Exhibit 17-1. If this production function is graphed with Real GDP on the vertical axis and labor on the horizontal axis,and capital rises from 4 units to 6 units it would cause a

When interest rates in a given economy are reduced,it causes firms to employ __________ capital goods. In terms of the production function (graphed with labor on the horizontal axis and Real GDP on the vertical axis),this then causes ____________________ .

When a production function is graphed with Real GDP on the vertical axis and labor on the horizontal axis,a rise in labor ________________________which shifts the LRAS curve ____________ resulting in ______________________.

In the production function Real GDP = T (L,K),the T represents the tax coefficient.

Using the production function Real GDP = T (L,K),define the term production function and describe what each of the variables (T,L,and K)represents. When graphed with Real GDP on the vertical axis and labor on the horizontal axis,which variable(s)can shift the production function and which variable(s)can cause a movement along the production function?

When income taxes are lowered in a given economy,it causes the supply of labor curve to shift __________which ___________ the equilibrium quantity of labor employed. In terms of the production function (graphed with labor on the horizontal axis and Real GDP on the vertical axis)this then causes _______________,which makes the LRAS curve shift ____________ resulting in ______________________.

Neoclassical growth theory emphasized how __________ contribute to growth.

If Real GDP is $6 billion and the population is 300,000,per-capita Real GDP is

According to new growth theory,discovering and implementing new __________ is what causes economic growth.

Research by Harvard economists Barro and McCleary revealed that church attendance and economic growth have a(n)_______________ relationship. They also found that specific religious beliefs (in heaven,hell,and afterlife)and economic growth have a(n)___________ relationship.

Exhibit 17-1 Production Function Real GDP = T (L, K), such that Real GDP = T(L + K) Assume that the technology coefficient is equal to 0.50. -Refer to Exhibit 17-1. If there are 4 units of capital and 6 units of labor,________ units of output (Real GDP)will be produced.

Real GDP in a small country is worth $8 billion.The population of the country is 200,000.What is per capita Real GDP?

A production function specifies the relation between ____________ and the ___________ to ____________________.

According to Paul Romer,one way to produce more ideas and knowledge is by

Exhibit 17-1 Production Function Real GDP = T (L, K), such that Real GDP = T(L + K) Assume that the technology coefficient is equal to 0.50. -Refer to Exhibit 17-1. If this production function is graphed with Real GDP on the vertical axis and labor on the horizontal axis,the resulting graph would be

When taxes on the return to capital in a given economy are reduced,it causes firms to employ __________ capital goods. In terms of the production function (graphed with labor on the horizontal axis and Real GDP on the vertical axis),this then causes ____________________ which makes the LRAS curve shift ____________ resulting in ______________________.

The concept that economic growth can do more than just give us more goods and services goes back to Adam Smith.

When a production function is graphed with Real GDP on the vertical axis and labor on the horizontal axis,a rise in capital________________________,and a rise in the technology coefficient __________________.

The Real GDP of country X doubled in 20 years.It follows that the annual growth rate in country X during this time period was

When interest rates fall in a given economy,it causes firms to borrow __________ funds used for purchasing capital goods. The result will be a(n)___________ in the level of capital employed in the economy. In terms of the production function (graphed with labor on the horizontal axis and Real GDP on the vertical axis),this then causes ____________________ which makes the LRAS curve shift ____________ resulting in ______________________.