Question 1

The notion that technological change is not random but instead is driven by the pursuit of profits is an essential element of

Accepted Answer

A)  neoclassical growth theory. 
B)  the new growth theory. 
C)  perpetual growth theory. 
D)  classical growth theory. 
A)  neoclassical growth theory. 
B)  the new growth theory. 
C)  perpetual growth theory. 
D)  classical growth theory. B

Question 2

During World War II, the increasing productivity of workers who built ships was due primarily to

Accepted Answer

A)  human capital accumulation by repeatedly doing the same tasks. 
B)  human capital accumulation through schooling and training. 
C)  investments by shipyards in new capital equipment. 
D)  discoveries of new and better technologies. 
A)  human capital accumulation by repeatedly doing the same tasks. 
B)  human capital accumulation through schooling and training. 
C)  investments by shipyards in new capital equipment. 
D)  discoveries of new and better technologies. A

Question 3

Which growth theory models growth as a perpetual motion machine?

Accepted Answer

A)  new growth theory 
B)  classical growth theory 
C)  all growth theories model growth as a perpetual motion machine 
D)  neoclassical growth theory 
A)  new growth theory 
B)  classical growth theory 
C)  all growth theories model growth as a perpetual motion machine 
D)  neoclassical growth theory A

Question 4

The aggregate production function describes the relationship between

Accepted Answer

A)  the rate of growth of real GDP and inflation. 
B)  real GDP and the quantity of labor employed. 
C)  real GDP and the price level. 
D)  real GDP and the unemployment rate. 
A)  the rate of growth of real GDP and inflation. 
B)  real GDP and the quantity of labor employed. 
C)  real GDP and the price level. 
D)  real GDP and the unemployment rate.

Question 5

The growth rate of real GDP per person in the United States has

Accepted Answer

A)  has consistently been 2 percent per decade over the past century. 
B)  has been the highest in the world over the past 5 decades. 
C)  averaged approximately 2 percent per year over the past century. 
D)  has increased every year over the past century. 
A)  has consistently been 2 percent per decade over the past century. 
B)  has been the highest in the world over the past 5 decades. 
C)  averaged approximately 2 percent per year over the past century. 
D)  has increased every year over the past century.

Question 6

The demand curve for labor shows how many hours workers demand to work.

Accepted Answer

A) True 
 B)False

Question 7

If the price level rises by 3 percent and workersʹ money wage rate increase by 1 percent, then the

Accepted Answer

A)  real wage rate increases. 
B)  quantity of labor supplied does not change because there is no change in the real wage rate. 
C)  quantity of labor supplied decreases. 
D)  quantity of labor supplied increases. 
A)  real wage rate increases. 
B)  quantity of labor supplied does not change because there is no change in the real wage rate. 
C)  quantity of labor supplied decreases. 
D)  quantity of labor supplied increases.

Question 8

If the labor and capital grow more quickly, then real GDP will

Accepted Answer

A)  stay fixed at potential GDP. 
B)  grow more quickly. 
C)  not grow fast enough. 
D)  grow more slowly. 
A)  stay fixed at potential GDP. 
B)  grow more quickly. 
C)  not grow fast enough. 
D)  grow more slowly.

Question 9

Classical growth theory argues that when real GDP per person rises above the subsistence level,

Accepted Answer

A)  people donʹt want to work as much, decreasing labor supply. 
B)  the economy enjoys a period of permanent growth. 
C)  technological change slows down, stagnating the economy. 
D)  population growth increases, driving real GDP per person back to subsistence level. 
A)  people donʹt want to work as much, decreasing labor supply. 
B)  the economy enjoys a period of permanent growth. 
C)  technological change slows down, stagnating the economy. 
D)  population growth increases, driving real GDP per person back to subsistence level.

Question 10

An increase in saving that leads to more capital accumulation ___________labor productivity.

Accepted Answer

A)  decreases 
B)  increases 
C)  probably changes but in an ambiguous direction 
D)  does not change 
A)  decreases 
B)  increases 
C)  probably changes but in an ambiguous direction 
D)  does not change

Question 11

If the money wage rate rises relative to the price level, firms ___________the quantity of labor they demand and workers _________the quantity of labor they supply.

Accepted Answer

A)  increase; decrease 
B)  decrease; decrease 
C)  decrease; increase 
D)  increase; increase 
A)  increase; decrease 
B)  decrease; decrease 
C)  decrease; increase 
D)  increase; increase

Question 12

The assumption that population growth will lead to a fall in real GDP per person rate back to subsistence level is

Accepted Answer

A)  associated with Malthusians. 
B)  central to the new growth theory. 
C)  part of the neoclassical school of growth theory. 
D)  accepted by all economists today. 
A)  associated with Malthusians. 
B)  central to the new growth theory. 
C)  part of the neoclassical school of growth theory. 
D)  accepted by all economists today.

Question 13

All of the following lead to more rapid economic growth EXCEPT

Accepted Answer

A)  supporting more research and development. 
B)  encouraging higher quality education. 
C)  encouraging higher rates of saving. 
D)  restricting international trade. 
A)  supporting more research and development. 
B)  encouraging higher quality education. 
C)  encouraging higher rates of saving. 
D)  restricting international trade.

Question 14

Technological change

Accepted Answer

A)  lowers the real wage rate. 
B)  increases potential GDP. 
C)  decreases labor productivity. 
D)  has no effect on employment. 
A)  lowers the real wage rate. 
B)  increases potential GDP. 
C)  decreases labor productivity. 
D)  has no effect on employment.

Question 15

If the price level falls by 5 percent and workersʹ money wage rates remain constant, firmsʹ

Accepted Answer

A)  supply of jobs will increase. 
B)  quantity of labor demanded will decrease. 
C)  quantity of labor demanded will increase. 
D)  None of the above answers are correct. 
A)  supply of jobs will increase. 
B)  quantity of labor demanded will decrease. 
C)  quantity of labor demanded will increase. 
D)  None of the above answers are correct.

Question 16

Which of following was a period of below-average economic growth in the United States?

Accepted Answer

A)  the 1960s 
B)  the 1930s 
C)  the 1920s 
D)  all of the above 
A)  the 1960s 
B)  the 1930s 
C)  the 1920s 
D)  all of the above

Question 17

All of the following would stimulate economic growth EXCEPT

Accepted Answer

A)  decreasing taxes on consumption for instance, decreasing a sales taxes) and increasing income taxes. 
B)  encouraging international trade. 
C)  decreasing tuition charges at state universities. 
D)  subsidizing basic research. 
A)  decreasing taxes on consumption for instance, decreasing a sales taxes) and increasing income taxes. 
B)  encouraging international trade. 
C)  decreasing tuition charges at state universities. 
D)  subsidizing basic research.

Question 18

By measuring ___________we can see that the economies of Hong Kong and Singapore are catching up to the economies of North America but that the economies of Central and South America are not.

Accepted Answer

A)  real GDP 
B)  the population 
C)  real GDP per person 
D)  inflation per person 
A)  real GDP 
B)  the population 
C)  real GDP per person 
D)  inflation per person

Question 19

Which of the following is used to calculate the standard of living?

Accepted Answer

A)  the one-third rule 
B)  real GDP in the current year - real GDP in previous year)/real GDP in previous year) x 100 
C)  real GDP/population 
D)  real GDP/aggregate hours 
A)  the one-third rule 
B)  real GDP in the current year - real GDP in previous year)/real GDP in previous year) x 100 
C)  real GDP/population 
D)  real GDP/aggregate hours

Question 20

What are the basic arguments of the neoclassical growth theory?

Accepted Answer

The neoclassical growth theory explains

The notion that technological change is not random but instead is driven by the pursuit of profits is an essential element of

During World War II, the increasing productivity of workers who built ships was due primarily to

Which growth theory models growth as a perpetual motion machine?

The aggregate production function describes the relationship between

The growth rate of real GDP per person in the United States has

The demand curve for labor shows how many hours workers demand to work.

If the price level rises by 3 percent and workersʹ money wage rate increase by 1 percent, then the

If the labor and capital grow more quickly, then real GDP will

Classical growth theory argues that when real GDP per person rises above the subsistence level,

An increase in saving that leads to more capital accumulation ___________labor productivity.

If the money wage rate rises relative to the price level, firms ___the quantity of labor they demand and workers _the quantity of labor they supply.

The assumption that population growth will lead to a fall in real GDP per person rate back to subsistence level is

All of the following lead to more rapid economic growth EXCEPT

Technological change

If the price level falls by 5 percent and workersʹ money wage rates remain constant, firmsʹ

Which of following was a period of below-average economic growth in the United States?

All of the following would stimulate economic growth EXCEPT

By measuring ___________we can see that the economies of Hong Kong and Singapore are catching up to the economies of North America but that the economies of Central and South America are not.

Which of the following is used to calculate the standard of living?

What are the basic arguments of the neoclassical growth theory?

What Is Economics

The Economic Problem

Demand and Supply

Measuring Gdp and Economic Growth

Monitoring Jobs and Inflation

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers: the Keynesian Model

U.S Inflation, Unemployment, and Business Cycle

Fiscal Policy

Monetary Policy

International Trade Policy

Review

Filters

Exam 6: Economic Growth

The notion that technological change is not random but instead is driven by the pursuit of profits is an essential element of

During World War II, the increasing productivity of workers who built ships was due primarily to

Which growth theory models growth as a perpetual motion machine?

The aggregate production function describes the relationship between

The growth rate of real GDP per person in the United States has

The demand curve for labor shows how many hours workers demand to work.

If the price level rises by 3 percent and workersʹ money wage rate increase by 1 percent, then the

If the labor and capital grow more quickly, then real GDP will

Classical growth theory argues that when real GDP per person rises above the subsistence level,

An increase in saving that leads to more capital accumulation ___________labor productivity.

If the money wage rate rises relative to the price level, firms ___________the quantity of labor they demand and workers _________the quantity of labor they supply.

The assumption that population growth will lead to a fall in real GDP per person rate back to subsistence level is

All of the following lead to more rapid economic growth EXCEPT

Technological change

If the price level falls by 5 percent and workersʹ money wage rates remain constant, firmsʹ

Which of following was a period of below-average economic growth in the United States?

All of the following would stimulate economic growth EXCEPT

By measuring ___________we can see that the economies of Hong Kong and Singapore are catching up to the economies of North America but that the economies of Central and South America are not.

Which of the following is used to calculate the standard of living?

What are the basic arguments of the neoclassical growth theory?

What Is Economics

The Economic Problem

Demand and Supply

Measuring Gdp and Economic Growth

Monitoring Jobs and Inflation

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers: the Keynesian Model

U.S Inflation, Unemployment, and Business Cycle

Fiscal Policy

Monetary Policy

International Trade Policy

Review

Filters

If the money wage rate rises relative to the price level, firms ___the quantity of labor they demand and workers _the quantity of labor they supply.