Question 1

If the economy's real GDP doubles in 18 years, we can:

Accepted Answer

A) not say anything about the average annual rate of growth. 
B) conclude that its average annual rate of growth is about 5.5 percent. 
C) conclude that its average annual rate of growth is about 2 percent. 
D) conclude that its average annual rate of growth is about 4 percent. 
A) not say anything about the average annual rate of growth. 
B) conclude that its average annual rate of growth is about 5.5 percent. 
C) conclude that its average annual rate of growth is about 2 percent. 
D) conclude that its average annual rate of growth is about 4 percent.

Question 2

If a nation's real GDP is growing by 3 percent per year, its real domestic output will double in approximately:

Accepted Answer

A) 21 years. 
B) 23 years. 
C) 29 years. 
D) 42 years. 
A) 21 years. 
B) 23 years. 
C) 29 years. 
D) 42 years.

Question 3

Critics of economic growth say that it will deplete economic resources.

Accepted Answer

A) True 
 B)False

Question 4

An anti-growth view would be that there may be a significant trade-off between productivity and:

Accepted Answer

A) education. 
B) employment. 
C) economies of scale. 
D) the quality of life. 
A) education. 
B) employment. 
C) economies of scale. 
D) the quality of life.

Question 5

Productivity growth is a minor source of improvements in real wage rates and the standard of living.

Accepted Answer

A) True 
 B)False

Question 6

Refer to the above graph.If the production possibilities curve of an economy shifts from AB to CD, it is most likely caused by:

Accepted Answer

A) a decrease in the price level. 
B) allocative efficiency. 
C) technological progress. 
D) full employment of resources. 
A) a decrease in the price level. 
B) allocative efficiency. 
C) technological progress. 
D) full employment of resources.

Question 7

During the last decade, the innovations in computers and telecommunications, together with global competition, have resulted in:

Accepted Answer

A) rational expectations theory. 
B) lower growth in capital stock. 
C) higher growth in labour force. 
D) higher productivity growth. 
A) rational expectations theory. 
B) lower growth in capital stock. 
C) higher growth in labour force. 
D) higher productivity growth.

Question 8

Increases in the value of the product to each user, including existing users, as the total number of users rises is called:

Accepted Answer

A) network effects. 
B) simultaneous consumption. 
C) learning by doing. 
D) the spreading of development costs. 
A) network effects. 
B) simultaneous consumption. 
C) learning by doing. 
D) the spreading of development costs.

Question 9

An increase in the quantity and quality of natural resources is a demand factor for economic growth.

Accepted Answer

A) True 
 B)False

Question 10

An outward shift in the production possibilities curve is the direct result of improvements in the efficiency factor for economic growth.

Accepted Answer

A) True 
 B)False

Question 11

One of the distinguishing features of the recent productivity growth is:

Accepted Answer

A) decreasing returns to scale in manufacturing. 
B) the need for less specialized inputs in manufacturing. 
C) technological progress from the investment in the space program. 
D) technological progress from the microchip and information technology. 
A) decreasing returns to scale in manufacturing. 
B) the need for less specialized inputs in manufacturing. 
C) technological progress from the investment in the space program. 
D) technological progress from the microchip and information technology.

Question 12

Which is best considered an efficiency factor in economic growth?

Accepted Answer

A) the quantity of human resources 
B) the quality of human resources 
C) the quantity of natural resources 
D) the full employment of resources 
A) the quantity of human resources 
B) the quality of human resources 
C) the quantity of natural resources 
D) the full employment of resources

Question 13

Real GDP was $4,719 billion in Year 1 and $4,848 billion in Year 2.In contrast, real GDP per capita in Year 1 was $19,261, but in Year 2 it was only $19,162.Why did one measure increase while the other measure decreased?

Accepted Answer

A) Real GDP indicates the level of industrial production and provides a measure of the economic strength of the nation; it is the only valid measure of economic growth. 
B) Inflation occurred during this period; therefore the two measures are not comparable. 
C) Population increased during this time period so real GDP per capita data reflect this change. 
D) Real GDP per capita measures changes in labour productivity that are not captured by a simple measure like real GDP. 
A) Real GDP indicates the level of industrial production and provides a measure of the economic strength of the nation; it is the only valid measure of economic growth. 
B) Inflation occurred during this period; therefore the two measures are not comparable. 
C) Population increased during this time period so real GDP per capita data reflect this change. 
D) Real GDP per capita measures changes in labour productivity that are not captured by a simple measure like real GDP.

Question 14

The slowdown of a nation's rate of productivity growth may:

Accepted Answer

A) slow the growth of its standard of living. 
B) contribute to deflation. 
C) make its industries more competitive in world markets. 
D) reduce real wages. 
A) slow the growth of its standard of living. 
B) contribute to deflation. 
C) make its industries more competitive in world markets. 
D) reduce real wages.

Question 15

Refer to the above diagram.Realized economic growth is best represented by a:

Accepted Answer

A) shift in the production possibilities curve from y on AB to X on CD. 
B) move from X on AB to y on CD. 
C) shift in the production possibilities curve from CD to AB. 
D) move from X to z along AB. 
A) shift in the production possibilities curve from y on AB to X on CD. 
B) move from X on AB to y on CD. 
C) shift in the production possibilities curve from CD to AB. 
D) move from X to z along AB.

Question 16

Growth is advantageous to a nation because it:

Accepted Answer

A) promotes faster population growth. 
B) lessens the burden of scarcity. 
C) eliminates the economizing problem. 
D) slows the growth of wants. 
A) promotes faster population growth. 
B) lessens the burden of scarcity. 
C) eliminates the economizing problem. 
D) slows the growth of wants.

Question 17

The case against economic growth is often made using which of the following arguments?

Accepted Answer

A) Limiting growth will contribute to more income equality across nations. 
B) Common property resources need to be protected by the price system. 
C) Economic growth permits us to "make a living," but it does not provide us with "the good life." 
D) Economic growth will contribute to more economic security, but it will also produce more boring life styles. 
A) Limiting growth will contribute to more income equality across nations. 
B) Common property resources need to be protected by the price system. 
C) Economic growth permits us to "make a living," but it does not provide us with "the good life." 
D) Economic growth will contribute to more economic security, but it will also produce more boring life styles.

Question 18

One of the main arguments against further growth for industrialized nations focuses on the problem of:

Accepted Answer

A) technological knowledge. 
B) environmental quality. 
C) feedback mechanisms. 
D) infrastructure. 
A) technological knowledge. 
B) environmental quality. 
C) feedback mechanisms. 
D) infrastructure.

Question 19

Labour productivity is measured by:

Accepted Answer

A) the ratio of capital to labour. 
B) real output per worker hour. 
C) real output per capital. 
D) the ratio of worker hours to nominal GDP. 
A) the ratio of capital to labour. 
B) real output per worker hour. 
C) real output per capital. 
D) the ratio of worker hours to nominal GDP.

Question 20

What economic concept would be most closely associated with a situation where an aluminum plant uses extensive computerization on the production line to reduce per-unit costs of production?

Accepted Answer

A) infrastructure 
B) human capital 
C) network effects 
D) economies of scale 
A) infrastructure 
B) human capital 
C) network effects 
D) economies of scale

Exam 8: B: Economic Growth

If the economy's real GDP doubles in 18 years, we can:

If a nation's real GDP is growing by 3 percent per year, its real domestic output will double in approximately:

Critics of economic growth say that it will deplete economic resources.

An anti-growth view would be that there may be a significant trade-off between productivity and:

Productivity growth is a minor source of improvements in real wage rates and the standard of living.

Refer to the above graph.If the production possibilities curve of an economy shifts from AB to CD, it is most likely caused by:

During the last decade, the innovations in computers and telecommunications, together with global competition, have resulted in:

Increases in the value of the product to each user, including existing users, as the total number of users rises is called:

An increase in the quantity and quality of natural resources is a demand factor for economic growth.

An outward shift in the production possibilities curve is the direct result of improvements in the efficiency factor for economic growth.

One of the distinguishing features of the recent productivity growth is:

Which is best considered an efficiency factor in economic growth?

Real GDP was $4,719 billion in Year 1 and $4,848 billion in Year 2.In contrast, real GDP per capita in Year 1 was $19,261, but in Year 2 it was only $19,162.Why did one measure increase while the other measure decreased?

The slowdown of a nation's rate of productivity growth may:

Refer to the above diagram.Realized economic growth is best represented by a:

Growth is advantageous to a nation because it:

The case against economic growth is often made using which of the following arguments?

One of the main arguments against further growth for industrialized nations focuses on the problem of:

Labour productivity is measured by:

What economic concept would be most closely associated with a situation where an aluminum plant uses extensive computerization on the production line to reduce per-unit costs of production?

B: Limits, Alternatives, and Choices

A: - Limits, Alternatives, and Choices

B: The Market System and the Circular Flow

A: - The Market System and the Circular Flow

B: Demand, Supply, and Market Equilibrium

A: - Demand, Supply, and Market Equilibrium

B: Market Failures: Public Goods and Externalities

A: - Market Failures: Public Goods and Externalities

B: Governments Role and Government Failure

A: Governments Role and Government Failure

B: an Introduction to Macroeconomics

A: an Introduction to Macroeconomics

B: Measuring the Economys Output

A: Measuring the Economys Output

A: Economic Growth

B: Business Cycles, Unemployment, and Inflation

A: Business Cycles, Unemployment, and Inflation

B: Basic Macroeconomic Relationships

A: Basic Macroeconomic Relationships

B: The Aggregate Expenditures Model

A: The Aggregate Expenditures Model

B: Aggregate Demand and Aggregate Supply

A: Aggregate Demand and Aggregate Supply

B: Fiscal Policy, Deficits, Surpluses, and Debt

A: Fiscal Policy, Deficits, Surpluses, and Debt

B: Money, Banking, and Money Creation

A: Money, Banking, and Money Creation

B: Interest Rates and Monetary Policy

A: Interest Rates and Monetary Policy

C: Financial Economics

A: Long-Run Macroeconomic Adjustments

B: Long-Run Macroeconomic Adjustments

A: International Trade

B: International Trade

A: The Balance of Payments and Exchange Rates

B: The Balance of Payments and Exchange Rates

The Economics of Developing Countries

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