Question 1

If the real wage rate is such that the quantity of labor supplied by workers is less than the quantity of labor demanded by firms,

Accepted Answer

A)  the economy is at full employment. 
B)  there is a shortage of labor. 
C)  real GDP equals potential GDP since firms make the decision on how many workers to hire. 
D)  the real wage rate will decrease. 
A)  the economy is at full employment. 
B)  there is a shortage of labor. 
C)  real GDP equals potential GDP since firms make the decision on how many workers to hire. 
D)  the real wage rate will decrease.

Question 2

Within neoclassical growth theory, technological change _________saving and__________
Investment.

Accepted Answer

A)  decreases; increases 
B)  increases; decreases 
C)  decreases; decreases 
D)  increases; increases 
A)  decreases; increases 
B)  increases; decreases 
C)  decreases; decreases 
D)  increases; increases

Question 3

An increase in the population and hence the supply of labor causes a

Accepted Answer

A)  surplus of labor at the original real wage rate and the real wage rate will fall. 
B)  shortage of labor at the original real wage rate and the real wage rate will rise. 
C)  surplus of labor at the original real wage rate and the real wage rate will rise. 
D)  shortage of labor at the original real wage rate and the real wage rate will fall. 
A)  surplus of labor at the original real wage rate and the real wage rate will fall. 
B)  shortage of labor at the original real wage rate and the real wage rate will rise. 
C)  surplus of labor at the original real wage rate and the real wage rate will rise. 
D)  shortage of labor at the original real wage rate and the real wage rate will fall.

Question 4

Several factors are important for achieving faster economic growth. Which of the following is one of those factors?

Accepted Answer

A)  increased taxes on saving 
B)  increased government expenditure 
C)  promotion of consumption expenditure 
D)  expansion of international trade 
A)  increased taxes on saving 
B)  increased government expenditure 
C)  promotion of consumption expenditure 
D)  expansion of international trade

Question 5

Greater labor force participation for households at higher real wage rate is one reason that

Accepted Answer

A)  the supply of labor curve is upward sloping. 
B)  the supply of labor curve is downward sloping. 
C)  the demand for labor curve is upward sloping. 
D)  the demand for labor curve is downward sloping. 
A)  the supply of labor curve is upward sloping. 
B)  the supply of labor curve is downward sloping. 
C)  the demand for labor curve is upward sloping. 
D)  the demand for labor curve is downward sloping.

Question 6

ʺIT Policy Can Spur Economic Growth, Industry Saysʺ
As staffers on Capitol Hill know all too well, the growth of technology has created an economy increasingly reliant on energy consumption, as BlackBerrys, laptops, and other devices become everyday necessities. The right policies, however, can make IT growth a part of the energy solution rather than the problem, IT representatives said Monday at a forum, in a congressional office, hosted by the Information Technology & Innovation Foundation.
Information technology could reduce the expected growth in carbon emissions by one third over 10 years, said Daniel Castro, a senior analyst with the ITIF.
Information and communication technology has ʺgreat promise in driving economic growth as well as reducing emissions,ʺ added David Isaacs, director of government affairs for
Hewlett-Packard, but ʺpolicy should drive these results.
In order to drive economic growth in real GDP per person, the changes in information technology that the article addresses must

Accepted Answer

A)  cause a movement along the aggregate production function. 
B)  decrease the demand for labor. 
C)  increase labor productivity. 
D)  increase labor supply. 
A)  cause a movement along the aggregate production function. 
B)  decrease the demand for labor. 
C)  increase labor productivity. 
D)  increase labor supply.

Question 7

Neoclassical growth theory predicts that

Accepted Answer

A)  population growth rates slow as employment opportunities for women increase. 
B)  economic growth leads to technological change. 
C)  population explosions decrease real GDP per person. 
D)  the pursuit of profit creates perpetual growth. 
A)  population growth rates slow as employment opportunities for women increase. 
B)  economic growth leads to technological change. 
C)  population explosions decrease real GDP per person. 
D)  the pursuit of profit creates perpetual growth.

Question 8

On-the-job-training is an example of

Accepted Answer

A)  technological change. 
B)  increasing labor force participation. 
C)  investment in physical capital. 
D)  investment in human capital. 
A)  technological change. 
B)  increasing labor force participation. 
C)  investment in physical capital. 
D)  investment in human capital.

Question 9

The supply of labor curve

Accepted Answer

A)  is independent of the wage rate. 
B)  is usually vertical. 
C)  has a negative slope. 
D)  shows how much labor workers are willing to supply at various real wage rates. 
A)  is independent of the wage rate. 
B)  is usually vertical. 
C)  has a negative slope. 
D)  shows how much labor workers are willing to supply at various real wage rates.

Question 10

The aggregate production function shows how __________varies with__________ .

Accepted Answer

A)  real GDP; labor 
B)  labor; capital 
C)  labor; leisure time 
D)  leisure time; labor 
A)  real GDP; labor 
B)  labor; capital 
C)  labor; leisure time 
D)  leisure time; labor

Question 11

One policy that would increase the saving rate would be

Accepted Answer

A)  taxing consumption. 
B)  raising taxes on the returns to saving. 
C)  raising taxes on saving. 
D)  raising taxes on the returns to investment. 
A)  taxing consumption. 
B)  raising taxes on the returns to saving. 
C)  raising taxes on saving. 
D)  raising taxes on the returns to investment.

Question 12

In 2008, Armenia had a real GDP of approximately $4.21 billion and a population of 2.98 million. In 2009, real GDP was $4.59 billion and population was 2.97 million. From 2008 to 2009, Armeniaʹs standard of living __________

Accepted Answer

A)  increased 
B)  did not change 
C)  decreased 
D)  might have increased, decreased, or remained unchanged but more information is needed to determine which. 
A)  increased 
B)  did not change 
C)  decreased 
D)  might have increased, decreased, or remained unchanged but more information is needed to determine which.

Question 13

If the quantity of capital per worker in the economy increases,

Accepted Answer

A)  the amount of money held by workers increases. 
B)  the stock of financial assets held by the public increases. 
C)  the stock of human capital necessarily increases. 
D)  labor productivity increases. 
A)  the amount of money held by workers increases. 
B)  the stock of financial assets held by the public increases. 
C)  the stock of human capital necessarily increases. 
D)  labor productivity increases.

Question 14

Human capital is

Accepted Answer

A)  peopleʹs knowledge and skills. 
B)  the saving done by human beings. 
C)  a measure of the labor productivity of workers. 
D)  the investment people make in industries that make capital goods. 
A)  peopleʹs knowledge and skills. 
B)  the saving done by human beings. 
C)  a measure of the labor productivity of workers. 
D)  the investment people make in industries that make capital goods.

Question 15

Which of the following will NOT work to increase the rate of economic growth?

Accepted Answer

A)  limit competition from international trade 
B)  improve the quality of education 
C)  increase saving 
D)  All of the above will work to increase the rate of economic growth. 
A)  limit competition from international trade 
B)  improve the quality of education 
C)  increase saving 
D)  All of the above will work to increase the rate of economic growth.

Question 16

If the real wage rate is such that the quantity of labor supplied is greater than the quantity of labor demanded,

Accepted Answer

A)  the economy is at full employment. 
B)  labor resources are allocated efficiently. 
C)  real GDP will not equal potential GDP. 
D)  job search decreases. 
A)  the economy is at full employment. 
B)  labor resources are allocated efficiently. 
C)  real GDP will not equal potential GDP. 
D)  job search decreases.

Question 17

Which of the following is consistent with the classical theory of growth?

Accepted Answer

A)  rapid population growth in poor countries 
B)  permanent increases in real wages 
C)  permanent growth in productivity 
D)  permanent increases in living standards 
A)  rapid population growth in poor countries 
B)  permanent increases in real wages 
C)  permanent growth in productivity 
D)  permanent increases in living standards

Question 18

The best definition for economic growth is

Accepted Answer

A)  a sustained expansion of production possibilities measured as the increase in nominal GDP over a given period. 
B)  a sustained expansion of consumption goods over a given period. 
C)  a sustained expansion of production possibilities measured as the increase in real GDP over a given period. 
D)  a sustained expansion of production goods over a given period. 
A)  a sustained expansion of production possibilities measured as the increase in nominal GDP over a given period. 
B)  a sustained expansion of consumption goods over a given period. 
C)  a sustained expansion of production possibilities measured as the increase in real GDP over a given period. 
D)  a sustained expansion of production goods over a given period.

Question 19

Cuba spends the highest percentage of GDP 18.7 percent) on education while the United States is the 38th highest spender with 5.7 percent of GDP. If spending on education is important for economic growth, which of the following statements explain why Cubaʹs economic growth rate is lower than the U.S. economic growth rate?
Data from United Nations Human Development
Programme)

Accepted Answer

A)  Cuba trades with many more countries than does the United States. 
B)  Cubaʹs population is smaller than the U.S. population. 
C)  Cuba doesnʹt offer property rights that promote innovation. 
D)  all of the above explain why Cubaʹs economic growth rate is lower than the U.S. economic growth rate. 
A)  Cuba trades with many more countries than does the United States. 
B)  Cubaʹs population is smaller than the U.S. population. 
C)  Cuba doesnʹt offer property rights that promote innovation. 
D)  all of the above explain why Cubaʹs economic growth rate is lower than the U.S. economic growth rate.

Question 20

If the population increases, then potential GDP and employment .

Accepted Answer

A)  decreases; decreases 
B)  decreases; increases 
C)  increases; increases 
D)  increases; decreases 
A)  decreases; decreases 
B)  decreases; increases 
C)  increases; increases 
D)  increases; decreases

If the real wage rate is such that the quantity of labor supplied by workers is less than the quantity of labor demanded by firms,

Within neoclassical growth theory, technological change _saving and__ Investment.

An increase in the population and hence the supply of labor causes a

Several factors are important for achieving faster economic growth. Which of the following is one of those factors?

Greater labor force participation for households at higher real wage rate is one reason that

Neoclassical growth theory predicts that

On-the-job-training is an example of

The supply of labor curve

The aggregate production function shows how varies with .

One policy that would increase the saving rate would be

In 2008, Armenia had a real GDP of approximately $4.21 billion and a population of 2.98 million. In 2009, real GDP was $4.59 billion and population was 2.97 million. From 2008 to 2009, Armeniaʹs standard of living __________

If the quantity of capital per worker in the economy increases,

Human capital is

Which of the following will NOT work to increase the rate of economic growth?

If the real wage rate is such that the quantity of labor supplied is greater than the quantity of labor demanded,

Which of the following is consistent with the classical theory of growth?

The best definition for economic growth is

If the population increases, then potential GDP and employment .

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

If the real wage rate is such that the quantity of labor supplied by workers is less than the quantity of labor demanded by firms,

Within neoclassical growth theory, technological change _________saving and__________ Investment.

An increase in the population and hence the supply of labor causes a

Several factors are important for achieving faster economic growth. Which of the following is one of those factors?

Greater labor force participation for households at higher real wage rate is one reason that

Neoclassical growth theory predicts that

On-the-job-training is an example of

The supply of labor curve

The aggregate production function shows how __________varies with__________ .

One policy that would increase the saving rate would be

In 2008, Armenia had a real GDP of approximately $4.21 billion and a population of 2.98 million. In 2009, real GDP was $4.59 billion and population was 2.97 million. From 2008 to 2009, Armeniaʹs standard of living __________

If the quantity of capital per worker in the economy increases,

Human capital is

Which of the following will NOT work to increase the rate of economic growth?

If the real wage rate is such that the quantity of labor supplied is greater than the quantity of labor demanded,

Which of the following is consistent with the classical theory of growth?

The best definition for economic growth is

If the population increases, then potential GDP and employment .

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

Within neoclassical growth theory, technological change _saving and__ Investment.

The aggregate production function shows how varies with .