Question 1

Suppose a country's population grows by 2 percent a year and,at the same time,its real GDP grows by 5 percent a year.Real GDP per person is increasing by ________ a year.

Accepted Answer

A) 2 percent 
B) 5 percent 
C) 10 percent 
D) 16 percent 
E) 3 percent 
A) 2 percent 
B) 5 percent 
C) 10 percent 
D) 16 percent 
E) 3 percent

Question 2

Which of the following is not a source of economic growth?

Accepted Answer

A) increasing stock market prices 
B) better educated workers 
C) growing physical capital 
D) appropriate incentive system 
E) advances in technology 
A) increasing stock market prices 
B) better educated workers 
C) growing physical capital 
D) appropriate incentive system 
E) advances in technology

Question 3

The key difference between the neoclassical growth theory and the classical growth theory is that

Accepted Answer

A) capital is not subject to diminishing returns under classical growth theory. 
B) capital is subject to diminishing returns under classical growth theory. 
C) increases in population drive workers' incomes back down to the subsistence level in classical growth theory. 
D) growth in the neoclassical growth theory ends with a population explosion. 
E) in classical growth theory, the pace of technological change influences the economic growth rate but economic growth does not influence the pace of technological change. 
A) capital is not subject to diminishing returns under classical growth theory. 
B) capital is subject to diminishing returns under classical growth theory. 
C) increases in population drive workers' incomes back down to the subsistence level in classical growth theory. 
D) growth in the neoclassical growth theory ends with a population explosion. 
E) in classical growth theory, the pace of technological change influences the economic growth rate but economic growth does not influence the pace of technological change.

Question 4

Use the figure below to answer the following questions.
   
Figure 22.3.2
-Refer to Figure 22.3.2.If the real wage is $20 an hour,a labour

Accepted Answer

A) shortage will occur and the real wage will rise. 
B) shortage will occur and the real wage will fall. 
C) surplus will occur and the real wage will rise. 
D) surplus will occur and the real wage will fall. 
E) surplus will occur and the demand for labour will increase. 
A) shortage will occur and the real wage will rise. 
B) shortage will occur and the real wage will fall. 
C) surplus will occur and the real wage will rise. 
D) surplus will occur and the real wage will fall. 
E) surplus will occur and the demand for labour will increase.

Question 5

In 2010,Northland had real GDP of $4.21 billion and a population of 2.98 million.In 2011,real GDP was $4.59 billion and population was 2.97 million.What was Northland's economic growth rate in 2011?

Accepted Answer

A) 0.38 percent 
B) 3.8 percent 
C) 8.3 percent 
D) 9.0 percent 
E) 11.1 percent 
A) 0.38 percent 
B) 3.8 percent 
C) 8.3 percent 
D) 9.0 percent 
E) 11.1 percent

Question 6

The key difference between the neoclassical growth theory and the new growth theory is that

Accepted Answer

A) capital is not subject to diminishing returns under new growth theory. 
B) capital is subject to diminishing returns under new growth theory. 
C) increases in population drive workers' incomes back down to the subsistence level in neoclassical growth theory. 
D) the pace of technological advances are caused by chance in new growth theory. 
E) labour productivity grows indefinitely in neoclassical growth theory. 
A) capital is not subject to diminishing returns under new growth theory. 
B) capital is subject to diminishing returns under new growth theory. 
C) increases in population drive workers' incomes back down to the subsistence level in neoclassical growth theory. 
D) the pace of technological advances are caused by chance in new growth theory. 
E) labour productivity grows indefinitely in neoclassical growth theory.

Question 7

Growth eventually stops in neoclassical growth theory when

Accepted Answer

A) technology stops advancing. 
B) saving increases. 
C) discoveries are replicated. 
D) the return on capital increases. 
E) population growth lowers the real wage rate. 
A) technology stops advancing. 
B) saving increases. 
C) discoveries are replicated. 
D) the return on capital increases. 
E) population growth lowers the real wage rate.

Question 8

If the real wage rate is $10.00 an hour and the price level is 60,the money wage rate is

Accepted Answer

A) $16.75 an hour. 
B) $18.50 an hour. 
C) $10.00 an hour. 
D) $6.00 an hour. 
E) $16.67 an hour. 
A) $16.75 an hour. 
B) $18.50 an hour. 
C) $10.00 an hour. 
D) $6.00 an hour. 
E) $16.67 an hour.

Question 9

During 2011,the country of Economia had real GDP of $115 billion and the population was 0.9 billion.In 2010,real GDP was $105 billion and the population was 0.85 billion.In 2011,real GDP per person was

Accepted Answer

A) $124. 
B) $135. 
C) $117. 
D) $12,778. 
E) $128. 
A) $124. 
B) $135. 
C) $117. 
D) $12,778. 
E) $128.

Question 10

If real GDP is $800 million and aggregate labour hours are 20 million,labour productivity is ________.

Accepted Answer

A) $40 an hour 
B) $16,000 million 
C) $40 million 
D) $160 an hour 
E) $16 an hour 
A) $40 an hour 
B) $16,000 million 
C) $40 million 
D) $160 an hour 
E) $16 an hour

Question 11

An assumption of the new growth theory is that

Accepted Answer

A) people earn a subsistence real wage in the long run. 
B) all technological advances are the result of chance. 
C) the marginal product of all types of capital increases as more capital is accumulated. 
D) the growth rate of labour productivity depends on people's ability to innovate. 
E) technological advances encourage international trade. 
A) people earn a subsistence real wage in the long run. 
B) all technological advances are the result of chance. 
C) the marginal product of all types of capital increases as more capital is accumulated. 
D) the growth rate of labour productivity depends on people's ability to innovate. 
E) technological advances encourage international trade.

Question 12

Which of the following statements about Canada's long-term growth trends is false?

Accepted Answer

A) Economic growth rates have been steady, except for the business cycle. 
B) Economic growth rates show periods of slow and high growth. 
C) Economic growth rates were faster in the 1990s than in the 1980s. 
D) Economic growth rates have slightly faster in the United States than in Canada. 
E) African countries have fallen further behind Canada in recent years. 
A) Economic growth rates have been steady, except for the business cycle. 
B) Economic growth rates show periods of slow and high growth. 
C) Economic growth rates were faster in the 1990s than in the 1980s. 
D) Economic growth rates have slightly faster in the United States than in Canada. 
E) African countries have fallen further behind Canada in recent years.

Question 13

Convergence between real GDP per person in Canada and Japan was relatively ________ during the 1960s;convergence has recently been ________.

Accepted Answer

A) slow;increasing 
B) rapid;decreasing 
C) rapid;increasing at an even faster rate 
D) slow;decreasing 
E) rapidly;continuing at the 1960s pace 
A) slow;increasing 
B) rapid;decreasing 
C) rapid;increasing at an even faster rate 
D) slow;decreasing 
E) rapidly;continuing at the 1960s pace

Question 14

The aggregate production function is graphed as

Accepted Answer

A) a downward-sloping curve. 
B) an upward-sloping straight line. 
C) an upward-sloping line that becomes flatter as the quantity of labour increases. 
D) an upward-sloping line that becomes steeper as the quantity of labour increases. 
E) a production possibilities frontier. 
A) a downward-sloping curve. 
B) an upward-sloping straight line. 
C) an upward-sloping line that becomes flatter as the quantity of labour increases. 
D) an upward-sloping line that becomes steeper as the quantity of labour increases. 
E) a production possibilities frontier.

Question 15

The aggregate production function shows how ________ varies with ________.

Accepted Answer

A) real GDP;labour 
B) labour;leisure 
C) real GDP;leisure 
D) labour;capital 
E) real GDP;capital 
A) real GDP;labour 
B) labour;leisure 
C) real GDP;leisure 
D) labour;capital 
E) real GDP;capital

Question 16

Slowdonia's current growth rate of real GDP per person is 2 percent a year.How long will it take to double real GDP per person?

Accepted Answer

A) half a year 
B) approximately 10 years 
C) 28.6 years 
D) 35 years 
E) 2 years 
A) half a year 
B) approximately 10 years 
C) 28.6 years 
D) 35 years 
E) 2 years

Question 17

Use the table below to answer the following questions.
Table 22.3.1

-Refer to Table 22.3.1.The tables show the labour market and the aggregate production function schedule for the country of Pickett.Potential GDP is ________.

Accepted Answer

A) $40 trillion 
B) $6 trillion 
C) $14 trillion 
D) $25 trillion 
E) $9 trillion 
A) $40 trillion 
B) $6 trillion 
C) $14 trillion 
D) $25 trillion 
E) $9 trillion

Question 18

Of the following countries,which has the lowest level of real GDP per person?

Accepted Answer

A) China 
B) Singapore 
C) Hong Kong 
D) Korea 
E) Canada 
A) China 
B) Singapore 
C) Hong Kong 
D) Korea 
E) Canada

Question 19

In 2010,Northland had real GDP of $4.21 billion and a population of 2.98 million.In 2011,real GDP was $4.59 billion and population was 2.97 million.Between 2010 and 2011,Northland's standard of living ________.

Accepted Answer

A) increased 
B) decreased 
C) did not change 
D) might have increased, decreased, or remained unchanged 
E) doubled. 
A) increased 
B) decreased 
C) did not change 
D) might have increased, decreased, or remained unchanged 
E) doubled.

Question 20

In 2010,Northland had real GDP of $4.21 billion and a population of 2.98 million.In 2011,real GDP was $4.59 billion and population was 2.97 million.Northland's real GDP per person in 2011 was

Accepted Answer

A) $1,545. 
B) $380. 
C) $1,413. 
D) $132. 
E) $1.41. 
A) $1,545. 
B) $380. 
C) $1,413. 
D) $132. 
E) $1.41.

Exam 22: Economic Growth

Suppose a country's population grows by 2 percent a year and,at the same time,its real GDP grows by 5 percent a year.Real GDP per person is increasing by ________ a year.

Which of the following is not a source of economic growth?

The key difference between the neoclassical growth theory and the classical growth theory is that

Use the figure below to answer the following questions. Figure 22.3.2 -Refer to Figure 22.3.2.If the real wage is $20 an hour,a labour

In 2010,Northland had real GDP of $4.21 billion and a population of 2.98 million.In 2011,real GDP was $4.59 billion and population was 2.97 million.What was Northland's economic growth rate in 2011?

The key difference between the neoclassical growth theory and the new growth theory is that

Growth eventually stops in neoclassical growth theory when

If the real wage rate is $10.00 an hour and the price level is 60,the money wage rate is

During 2011,the country of Economia had real GDP of $115 billion and the population was 0.9 billion.In 2010,real GDP was $105 billion and the population was 0.85 billion.In 2011,real GDP per person was

If real GDP is $800 million and aggregate labour hours are 20 million,labour productivity is ________.

An assumption of the new growth theory is that

Which of the following statements about Canada's long-term growth trends is false?

Convergence between real GDP per person in Canada and Japan was relatively ________ during the 1960s;convergence has recently been ________.

The aggregate production function is graphed as

The aggregate production function shows how ________ varies with ________.

Slowdonia's current growth rate of real GDP per person is 2 percent a year.How long will it take to double real GDP per person?

Use the table below to answer the following questions. Table 22.3.1 -Refer to Table 22.3.1.The tables show the labour market and the aggregate production function schedule for the country of Pickett.Potential GDP is ________.

Of the following countries,which has the lowest level of real GDP per person?

In 2010,Northland had real GDP of $4.21 billion and a population of 2.98 million.In 2011,real GDP was $4.59 billion and population was 2.97 million.Between 2010 and 2011,Northland's standard of living ________.

In 2010,Northland had real GDP of $4.21 billion and a population of 2.98 million.In 2011,real GDP was $4.59 billion and population was 2.97 million.Northland's real GDP per person in 2011 was

What Is Economics?

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Elasticity

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Government Actions in Markets

Global Markets in Action

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Possibilities, Preferences, and Choices

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Oligopoly

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Economic Inequality

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Convergence between real GDP per person in Canada and Japan was relatively during the 1960s;convergence has recently been .

The aggregate production function shows how varies with .