Question 1

The catch-up prediction of economic growth models predicts that ________ across countries will converge over time.

Accepted Answer

A)  income levels 
B)  GDP per capita 
C)  foreign direct investment rates 
D)  growth rates 
A)  income levels 
B)  GDP per capita 
C)  foreign direct investment rates 
D)  growth rates

Question 2

Productivity gains in the United States since 1990 have been ________ the productivity gains in other leading industrial nations.

Accepted Answer

A)  the same as 
B)  lower than 
C)  higher than 
D)  more variable than 
A)  the same as 
B)  lower than 
C)  higher than 
D)  more variable than

Question 3

In the United States, the number of hours worked per person has decreased since 1800. How would growth rates since 1800 be different if they were calculated for real GDP per capita instead of GDP per hour worked?

Accepted Answer

Because the number of hours worked per p

Question 4

Table 22-6
  
-Refer to Table 22-6. Consider the statistics in the table above in describing the developing countries. Are these consistent with the economic growth model? Briefly explain.

Accepted Answer

These statistics for developing countrie

Question 5

All of the following are reasons why China is unlikely to maintain high enough rates of productivity growth to catch-up with the standard of living in the United States except

Accepted Answer

A)  the United States invests more in research and development. than does China. 
B)  much of China's growth is likely due to the transition from a centrally-planned economy to a market economy. 
C)  because of the low birth rate in China, the labor force will soon decline. 
D)  the Chinese migration of rural workers to more productive urban jobs. 
A)  the United States invests more in research and development. than does China. 
B)  much of China's growth is likely due to the transition from a centrally-planned economy to a market economy. 
C)  because of the low birth rate in China, the labor force will soon decline. 
D)  the Chinese migration of rural workers to more productive urban jobs.

Question 6

Which of the following government provisions would help increase the accumulation of knowledge capital?

Accepted Answer

A)  patents 
B)  copyrights 
C)  education subsidies 
D)  All of the above are correct. 
A)  patents 
B)  copyrights 
C)  education subsidies 
D)  All of the above are correct.

Question 7

A copyright grants the creator of a book, film, or piece of software exclusive legal rights to use the creation for how long?

Accepted Answer

A)  10 years 
B)  20 years 
C)  50 years 
D)  the creator's lifetime plus 70 years for the creator's heirs 
A)  10 years 
B)  20 years 
C)  50 years 
D)  the creator's lifetime plus 70 years for the creator's heirs

Question 8

According to new growth theory, firms accumulate the efficient level of both physical and knowledge capital.

Accepted Answer

A) True 
 B)False

Question 9

In the early 1900s, Henry Ford revolutionized the automotive manufacturing industry by instituting the assembly line. What impact did the assembly line method for producing automobiles have on the per-worker production function for Ford?

Accepted Answer

A)  It became flatter. 
B)  It shifted up. 
C)  It shifted down. 
D)  It became linear. 
A)  It became flatter. 
B)  It shifted up. 
C)  It shifted down. 
D)  It became linear.

Question 10

High-income countries have ________ and ________ as compared to developing countries.

Accepted Answer

A)  low rates of savings; high rates of growth 
B)  low rates of savings; low rates of growth 
C)  high rates of savings; high rates of growth 
D)  high rates of savings; low rates of growth 
A)  low rates of savings; high rates of growth 
B)  low rates of savings; low rates of growth 
C)  high rates of savings; high rates of growth 
D)  high rates of savings; low rates of growth

Question 11

Knowledge capital is

Accepted Answer

A)  rival. 
B)  nonrival. 
C)  nonexcludable. 
D)  both B and C 
A)  rival. 
B)  nonrival. 
C)  nonexcludable. 
D)  both B and C

Question 12

According to Douglass North, the Industrial Revolution occurred in England because

Accepted Answer

A)  the British Parliament took control of the government and could credibly commit to upholding property rights. 
B)  the British monarchy took control of the government and pledged not to raise taxes arbitrarily. 
C)  the British courts became tied to the king and began to refuse to enforce property rights. 
D)  the British Parliament instituted a command economy structure and implemented a planned economy. 
A)  the British Parliament took control of the government and could credibly commit to upholding property rights. 
B)  the British monarchy took control of the government and pledged not to raise taxes arbitrarily. 
C)  the British courts became tied to the king and began to refuse to enforce property rights. 
D)  the British Parliament instituted a command economy structure and implemented a planned economy.

Question 13

In a small Asian country, it is estimated that a $10,000 increase in capital per hour worked will increase real GDP per hour worked by $600. Based on this information, what is the slope of the per-worker production function in this range?

Accepted Answer

A)  0.06 
B)  6.6 
C)  66.6 
D)  666 
A)  0.06 
B)  6.6 
C)  66.6 
D)  666

Question 14

In 2016, South America had a lower average GDP per capita than any other continent.

Accepted Answer

A) True 
 B)False

Question 15

The Soviet Union's economic growth rate slowed despite rapid increases in capital per hour worked.

Accepted Answer

A) True 
 B)False

Question 16

Empirical evidence from 1960 to 2014 shows that convergence in economic growth is occurring in which of the following cases?

Accepted Answer

A)  Low-income industrial countries are catching up to high-income industrial countries. 
B)  Low-income developing countries are catching up to high-income industrial countries. 
C)  Low-income industrial countries are catching up to high-income developing countries. 
D)  All low-income countries are catching up to all high-income countries. 
A)  Low-income industrial countries are catching up to high-income industrial countries. 
B)  Low-income developing countries are catching up to high-income industrial countries. 
C)  Low-income industrial countries are catching up to high-income developing countries. 
D)  All low-income countries are catching up to all high-income countries.

Question 17

Draw a graph of "catch-up" that shows where you would expect to see a country with low saving rates and low levels of health and education. How would you expect real GDP per capita to grow in a country like this? Explain.

Accepted Answer

Countries with low saving rates and low

Question 18

New growth theory

Accepted Answer

A)  states that the rate of technological change is determined outside the working of the market system. 
B)  does not adequately explain the factors that determine productivity. 
C)  states that the rate of technological change is caused by economic incentives. 
D)  states that the rate of technological change is unaffected by economic incentives. 
A)  states that the rate of technological change is determined outside the working of the market system. 
B)  does not adequately explain the factors that determine productivity. 
C)  states that the rate of technological change is caused by economic incentives. 
D)  states that the rate of technological change is unaffected by economic incentives.

Question 19

If the per-worker production function shifts down,

Accepted Answer

A)  it now takes more capital per hour worked to get the same amount of real GDP per hour worked. 
B)  an economy can increase its real GDP per hour worked without changing the level of capital per hour worked. 
C)  the per-worker production function becomes steeper. 
D)  positive technological change has occurred in the economy. 
A)  it now takes more capital per hour worked to get the same amount of real GDP per hour worked. 
B)  an economy can increase its real GDP per hour worked without changing the level of capital per hour worked. 
C)  the per-worker production function becomes steeper. 
D)  positive technological change has occurred in the economy.

Question 20

If there is a change in the ability of a firm to produce a given level of output with a given level of inputs, we say there is

Accepted Answer

A)  human capital investment. 
B)  technological change. 
C)  a decrease in labor productivity. 
D)  a movement along a given per-worker production function. 
A)  human capital investment. 
B)  technological change. 
C)  a decrease in labor productivity. 
D)  a movement along a given per-worker production function.

Exam 22: Long-Run Economic Growth: Sources and Policies

The catch-up prediction of economic growth models predicts that ________ across countries will converge over time.

Productivity gains in the United States since 1990 have been ________ the productivity gains in other leading industrial nations.

In the United States, the number of hours worked per person has decreased since 1800. How would growth rates since 1800 be different if they were calculated for real GDP per capita instead of GDP per hour worked?

Table 22-6 -Refer to Table 22-6. Consider the statistics in the table above in describing the developing countries. Are these consistent with the economic growth model? Briefly explain.

All of the following are reasons why China is unlikely to maintain high enough rates of productivity growth to catch-up with the standard of living in the United States except

Which of the following government provisions would help increase the accumulation of knowledge capital?

A copyright grants the creator of a book, film, or piece of software exclusive legal rights to use the creation for how long?

According to new growth theory, firms accumulate the efficient level of both physical and knowledge capital.

In the early 1900s, Henry Ford revolutionized the automotive manufacturing industry by instituting the assembly line. What impact did the assembly line method for producing automobiles have on the per-worker production function for Ford?

High-income countries have ________ and ________ as compared to developing countries.

Knowledge capital is

According to Douglass North, the Industrial Revolution occurred in England because

In a small Asian country, it is estimated that a $10,000 increase in capital per hour worked will increase real GDP per hour worked by $600. Based on this information, what is the slope of the per-worker production function in this range?

In 2016, South America had a lower average GDP per capita than any other continent.

The Soviet Union's economic growth rate slowed despite rapid increases in capital per hour worked.

Empirical evidence from 1960 to 2014 shows that convergence in economic growth is occurring in which of the following cases?

Draw a graph of "catch-up" that shows where you would expect to see a country with low saving rates and low levels of health and education. How would you expect real GDP per capita to grow in a country like this? Explain.

New growth theory

If the per-worker production function shifts down,

If there is a change in the ability of a firm to produce a given level of output with a given level of inputs, we say there is

Economics: Foundations and Models

Trade-Offs, Comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Economic Efficiency, Government Price Setting, and Taxes

Externalities, Environmental Policy, and Public Goods

Elasticity: the Responsiveness of Demand and Supply

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Comparative Advantage and the Gains From International Trade

Consumer Choice and Behavioral Economics

Technology, Production, and Costs

Firms in Perfectly Competitive Markets

Monopolistic Competition: the Competitive Model in a More Realistic Setting

Oligopoly: Firms in Less Competitive Markets

Monopoly and Antitrust Policy

Pricing Strategy

The Markets for Labor and Other Factors of Production

Public Choice, Taxes, and the Distribution of Income

Gdp: Measuring Total Production and Income

Unemployment and Inflation

Economic Growth, the Financial System, and Business Cycles

Aggregate Expenditure and Output in the Short Run

Aggregate Demand and Aggregate Supply Analysis

Money, Banks, and the Federal Reserve System

Monetary Policy

Fiscal Policy

Inflation, Unemployment, and Federal Reserve Policy

Macroeconomics in an Open Economy

The International Financial System

Filters

High-income countries have and as compared to developing countries.