Question 1

A rapid increase in the number of workers, other things the same, is likely in the short term to

Accepted Answer

A) raise real GDP per person, but decrease real GDP. 
B) decrease both real GDP and real GDP per person. 
C) raise both real GDP and real GDP per person. 
D) raise real GDP, but decrease real GDP per person. 
A) raise real GDP per person, but decrease real GDP. 
B) decrease both real GDP and real GDP per person. 
C) raise both real GDP and real GDP per person. 
D) raise real GDP, but decrease real GDP per person.

Question 2

An increase in the saving rate would, other things the same,

Accepted Answer

A) increase growth more for a poor country than for a rich country, and raise growth permanently. 
B) increase growth more for a poor country than for a rich country, but raise growth temporarily. 
C) increase growth more for a rich country than for a poor country, and raise growth permanently. 
D) increase growth more for a rich country than for a poor country, but raise growth temporarily. 
A) increase growth more for a poor country than for a rich country, and raise growth permanently. 
B) increase growth more for a poor country than for a rich country, but raise growth temporarily. 
C) increase growth more for a rich country than for a poor country, and raise growth permanently. 
D) increase growth more for a rich country than for a poor country, but raise growth temporarily.

Question 3

Other things the same, an economy's factors of production are likely to be used more effectively if there is an economywide respect for property rights.

Accepted Answer

A) True 
 B)False

Question 4

In the production function   
, Y represents the quantity of output; L represents the quantity of labor; K represents the quantity of physical capital; and N represents the quantity of natural resources. What does H represent?

Accepted Answer

H represen

Question 5

Suppose a person receives an education in her home country. Which of the following will tend to make the increase in GDP of the person's home country larger than the increase in this person's income?

Accepted Answer

A) externalities and brain drain 
B) externalities but not brain drain 
C) brain drain but not externalities 
D) neither externalities nor brain drain 
A) externalities and brain drain 
B) externalities but not brain drain 
C) brain drain but not externalities 
D) neither externalities nor brain drain

Question 6

Which of the following statements is true?

Accepted Answer

A) The quantity of natural resources per worker can influence productivity. 
B) Technological knowledge and human capital are closely related. 
C) Over long periods of time, the prices of most natural resources are stable or falling, relative to other prices. 
D) All of the above are correct. 
A) The quantity of natural resources per worker can influence productivity. 
B) Technological knowledge and human capital are closely related. 
C) Over long periods of time, the prices of most natural resources are stable or falling, relative to other prices. 
D) All of the above are correct.

Question 7

Assuming constant returns to scale, if two countries are otherwise the same, the one that is poorer grows faster.

Accepted Answer

A) True 
 B)False

Question 8

If there are diminishing returns to capital, then

Accepted Answer

A) capital produces fewer goods as it ages. 
B) old ideas are not as useful as new ones. 
C) increases in the capital stock eventually decrease output. 
D) increases in the capital stock increase output by ever smaller amounts. 
A) capital produces fewer goods as it ages. 
B) old ideas are not as useful as new ones. 
C) increases in the capital stock eventually decrease output. 
D) increases in the capital stock increase output by ever smaller amounts.

Question 9

Your company discovers a better way to produce mousetraps, but your better methods are not apparent from the mousetraps themselves. Your knowledge of how to more efficiently produce mousetraps is

Accepted Answer

A) common technological knowledge. 
B) common, but not technological, knowledge. 
C) proprietary technological knowledge. 
D) proprietary, but not technological, knowledge. 
A) common technological knowledge. 
B) common, but not technological, knowledge. 
C) proprietary technological knowledge. 
D) proprietary, but not technological, knowledge.

Question 10

If an economy with constant returns to scale were to double its physical capital stock, its available natural resources, and its human capital, but leave the size of the labor force the same,

Accepted Answer

A) its output would stay the same and so would its productivity. 
B) its output and productivity would increase, but less than double. 
C) its output and productivity would increase by more than double. 
D) None of the above is correct. 
A) its output would stay the same and so would its productivity. 
B) its output and productivity would increase, but less than double. 
C) its output and productivity would increase by more than double. 
D) None of the above is correct.

Question 11

It is possible for a country without a lot of domestic natural resources to have a high standard of living.

Accepted Answer

A) True 
 B)False

Question 12

Why does a nation's standard of living depend on property rights?

Accepted Answer

Property rights are an important prerequ

Question 13

Use the data on U.S. real GDP below to compute real GDP per person for each year. Then use these numbers to compute the percentage increase in real GDP per person from 1993 to 2012.

Accepted Answer

Real GDP per person in 1993 wa

Question 14

In what sense is it likely that geography has an effect on a country's rate of economic growth?

Accepted Answer

Countries with natural seaport

Question 15

Which of the following is an example of a renewable natural resource?

Accepted Answer

A) the knowledge possessed by scientists 
B) carpenters' labor services 
C) lumber 
D) All of the above are correct. 
A) the knowledge possessed by scientists 
B) carpenters' labor services 
C) lumber 
D) All of the above are correct.

Question 16

In the production function   
, Y represents the quantity of output; L represents the quantity of labor; K represents the quantity of physical capital; and H represents the quantity of human capital. What does N represent?

Accepted Answer

N represen

Question 17

Productivity is the

Accepted Answer

A) key determinant of living standards, and growth in productivity is the key determinant of growth in living standards. 
B) key determinant of living standards, but growth in productivity is not the key determinant of growth in living standards. 
C) not the key determinant of living standards, but growth in productivity is the key determinant of growth in living standards. 
D) not the key determinant of living standards, and growth in productivity is not the key determinant of growth in living standards. 
A) key determinant of living standards, and growth in productivity is the key determinant of growth in living standards. 
B) key determinant of living standards, but growth in productivity is not the key determinant of growth in living standards. 
C) not the key determinant of living standards, but growth in productivity is the key determinant of growth in living standards. 
D) not the key determinant of living standards, and growth in productivity is not the key determinant of growth in living standards.

Question 18

Government corruption

Accepted Answer

A) impedes the coordinating power of markets and discourages investment. 
B) impedes the coordinating power of markets but does not discourage investment. 
C) does not impede the coordinating power of markets, but does discourage investment. 
D) can neither impede the coordinating power of markets nor discourage investment. 
A) impedes the coordinating power of markets and discourages investment. 
B) impedes the coordinating power of markets but does not discourage investment. 
C) does not impede the coordinating power of markets, but does discourage investment. 
D) can neither impede the coordinating power of markets nor discourage investment.

Question 19

Country A experienced a growth rate of real GDP per person of 0.5 percent per year throughout the 1900's. In view of other countries' experiences, country A's growth was

Accepted Answer

A) exceptionally high. 
B) moderately high. 
C) moderately low. 
D) exceptionally low. 
A) exceptionally high. 
B) moderately high. 
C) moderately low. 
D) exceptionally low.

Question 20

Ralph is a plumber. Which of the following are included in his human capital?

Accepted Answer

A) the knowledge he learned on the job, and the tools he uses 
B) the knowledge he learned on the job, but not the tools he uses 
C) the tools he uses, but not the knowledge he learned on the job 
D) neither the knowledge he learned on the job nor the tools he uses 
A) the knowledge he learned on the job, and the tools he uses 
B) the knowledge he learned on the job, but not the tools he uses 
C) the tools he uses, but not the knowledge he learned on the job 
D) neither the knowledge he learned on the job nor the tools he uses

Exam 25: Production and Growth

A rapid increase in the number of workers, other things the same, is likely in the short term to

An increase in the saving rate would, other things the same,

Other things the same, an economy's factors of production are likely to be used more effectively if there is an economywide respect for property rights.

In the production function , Y represents the quantity of output; L represents the quantity of labor; K represents the quantity of physical capital; and N represents the quantity of natural resources. What does H represent?

Suppose a person receives an education in her home country. Which of the following will tend to make the increase in GDP of the person's home country larger than the increase in this person's income?

Which of the following statements is true?

Assuming constant returns to scale, if two countries are otherwise the same, the one that is poorer grows faster.

If there are diminishing returns to capital, then

Your company discovers a better way to produce mousetraps, but your better methods are not apparent from the mousetraps themselves. Your knowledge of how to more efficiently produce mousetraps is

If an economy with constant returns to scale were to double its physical capital stock, its available natural resources, and its human capital, but leave the size of the labor force the same,

It is possible for a country without a lot of domestic natural resources to have a high standard of living.

Why does a nation's standard of living depend on property rights?

Use the data on U.S. real GDP below to compute real GDP per person for each year. Then use these numbers to compute the percentage increase in real GDP per person from 1993 to 2012.

In what sense is it likely that geography has an effect on a country's rate of economic growth?

Which of the following is an example of a renewable natural resource?

In the production function , Y represents the quantity of output; L represents the quantity of labor; K represents the quantity of physical capital; and H represents the quantity of human capital. What does N represent?

Productivity is the

Government corruption

Country A experienced a growth rate of real GDP per person of 0.5 percent per year throughout the 1900's. In view of other countries' experiences, country A's growth was

Ralph is a plumber. Which of the following are included in his human capital?

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, Demand, and Government Policies

Consumers, Producers, and the Efficiency of Markets

Applications: the Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers in Microeconomics

Measuring a Nation S Income

Measuring the Cost of Living

Saving, Investment, and the Financial System

Tools of Finance

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

Filters