Question 1

In the United States over the past century, real GDP per person has grown by about __________ percent per year.

Accepted Answer

2 (or, mor

Question 2

Which of the following is correct?

Accepted Answer

A) There is no debate about the effects of higher population growth on economic growth. 
B) Natural resources clearly place limits on growth; there is simply no way to reduce either the amount or type of natural resources needed to produce goods. 
C) How much an increase in capital increases a country's output is independent of that country's current level of capital. 
D) Economists argue that outward rather than inward policies are likely to promote economic growth. 
A) There is no debate about the effects of higher population growth on economic growth. 
B) Natural resources clearly place limits on growth; there is simply no way to reduce either the amount or type of natural resources needed to produce goods. 
C) How much an increase in capital increases a country's output is independent of that country's current level of capital. 
D) Economists argue that outward rather than inward policies are likely to promote economic growth.

Question 3

Over the last century, U.S. real GDP per person grew at a rate of about

Accepted Answer

A) 2 percent per year, so that it is now 2 times as high as it was a century ago. 
B) 2 percent per year, so that it is now 8 times as high as it was a century ago. 
C) 4 percent per year, so that it is now 2 times as high as it was a century ago. 
D) 4 percent per year, so that it is now 8 times as high as it was a century ago. 
A) 2 percent per year, so that it is now 2 times as high as it was a century ago. 
B) 2 percent per year, so that it is now 8 times as high as it was a century ago. 
C) 4 percent per year, so that it is now 2 times as high as it was a century ago. 
D) 4 percent per year, so that it is now 8 times as high as it was a century ago.

Question 4

Last year the imaginary country of Basova had a population of 10,000, 6,000 people worked 8 hours a day, and produced a real GDP of $30,000,000. The imaginary country of Andovia had a population of 12,000, 8,000 people worked 8 hours a day, and produced a real GDP of $38,000,000. Which of the following is correct?

Accepted Answer

A) Basova had higher productivity and higher real GDP per person. 
B) Andovia had the higher productivity and higher real GDP per person. 
C) Basova had the higher productivity while Andovia had the higher real GDP per person. 
D) Andovia had the higher productivity while Basova had the higher real GDP per person. 
A) Basova had higher productivity and higher real GDP per person. 
B) Andovia had the higher productivity and higher real GDP per person. 
C) Basova had the higher productivity while Andovia had the higher real GDP per person. 
D) Andovia had the higher productivity while Basova had the higher real GDP per person.

Question 5

When Chile experiences investment from abroad, it experiences, as a result,

Accepted Answer

A) an increase in productivity. 
B) a decrease in Gross National Product (GNP). 
C) lower wages for Chilean workers. 
D) None of the above is correct. 
A) an increase in productivity. 
B) a decrease in Gross National Product (GNP). 
C) lower wages for Chilean workers. 
D) None of the above is correct.

Question 6

Human capital is the term economists use to refer to the knowledge and skills that workers acquire through education, training, and experience.

Accepted Answer

A) True 
 B)False

Question 7

If a country's saving rate increases, then in the long run

Accepted Answer

A) productivity is higher but real GDP per person is not higher. 
B) real GDP per person is higher but productivity is not higher. 
C) productivity and real GDP per person are both higher. 
D) neither productivity nor real GDP per person is higher. 
A) productivity is higher but real GDP per person is not higher. 
B) real GDP per person is higher but productivity is not higher. 
C) productivity and real GDP per person are both higher. 
D) neither productivity nor real GDP per person is higher.

Question 8

If your firm's production function has constant returns to scale and you increase all your inputs by 60%, then your firm's output will

Accepted Answer

A) not change. 
B) increase, but by less than 60% 
C) increase by 60% 
D) increase by more than 60%. 
A) not change. 
B) increase, but by less than 60% 
C) increase by 60% 
D) increase by more than 60%.

Question 9

When a country removes trade barriers and imports appliances and exports engineering services,

Accepted Answer

A) its growth slows. 
B) its productivity decreases. 
C) it is essentially transforming engineering services into appliances. 
D) its economic well-being decreases while that of the country that sells appliances increases. 
A) its growth slows. 
B) its productivity decreases. 
C) it is essentially transforming engineering services into appliances. 
D) its economic well-being decreases while that of the country that sells appliances increases.

Question 10

Other things the same, which of the following would increase productivity?

Accepted Answer

A) an increase in either human or physical capital 
B) an increase in human capital but not an increase in physical capital 
C) an increase in physical capital but not an increase in human capital 
D) neither an increase in human capital nor an increase in physical capital 
A) an increase in either human or physical capital 
B) an increase in human capital but not an increase in physical capital 
C) an increase in physical capital but not an increase in human capital 
D) neither an increase in human capital nor an increase in physical capital

Question 11

Both the standard of living and the growth of real GDP per person vary widely across countries.

Accepted Answer

A) True 
 B)False

Question 12

Measured in 2014 dollars, real GDP per person in the United States in 2014 was about

Accepted Answer

A) $37,000. 
B) $56,000. 
C) $57,000. 
D) $67,000. 
A) $37,000. 
B) $56,000. 
C) $57,000. 
D) $67,000.

Question 13

In 2011, the imaginary nation of Maconia had a population of 8,200 and real GDP of 210,500. Maconia had 5% growth in real GDP per person. In 2012 it had a population of 8,400. To the nearest dollar what was real GDP in Maconia in 2012?

Accepted Answer

A) 216,815 
B) 221,025 
C) 226,416 
D) None of the above is correct. 
A) 216,815 
B) 221,025 
C) 226,416 
D) None of the above is correct.

Question 14

​The rate of real economic growth

Accepted Answer

A) ​is underestimated using measures of income growth. 
B) ​​is overestimated using measures of income growth. 
C) ​​is underestimated using measures of technological growth. 
D) ​​​is overestimated using measures of technological growth. 
A) ​is underestimated using measures of income growth. 
B) ​​is overestimated using measures of income growth. 
C) ​​is underestimated using measures of technological growth. 
D) ​​​is overestimated using measures of technological growth.

Question 15

Which of the following statements is not correct?

Accepted Answer

A) The catch-up effect is based on the assumption of diminishing returns to capital. 
B) Investment in poor countries by citizens of rich countries is one way poor countries can learn new technologies. 
C) Malthus argued that charity and government aid was an effective way to reduce poverty. 
D) Peace and justice are keys to growth. 
A) The catch-up effect is based on the assumption of diminishing returns to capital. 
B) Investment in poor countries by citizens of rich countries is one way poor countries can learn new technologies. 
C) Malthus argued that charity and government aid was an effective way to reduce poverty. 
D) Peace and justice are keys to growth.

Question 16

The president of a poor country has announced that he will implement the following measures that he claims are designed to increase growth: 1. Reduce corruption in the legal system; 2. Reduce reliance on market forces because they allocate goods and services in an unfair manner; 3. Restrict investment in domestic industries by foreigners because they take some of the profits out of the country; 4. Encourage trade with neighboring countries; and 5. Increase the fraction of GDP devoted to consumption. How many of these measures will have a positive effect on growth?

Accepted Answer

A) 1 
B) 2 
C) 3 
D) 4 
A) 1 
B) 2 
C) 3 
D) 4

Question 17

Accumulating capital

Accepted Answer

A) requires that society sacrifice consumption goods in the present. 
B) allows society to consume more in the present. 
C) decreases saving rates. 
D) involves no tradeoffs. 
A) requires that society sacrifice consumption goods in the present. 
B) allows society to consume more in the present. 
C) decreases saving rates. 
D) involves no tradeoffs.

Question 18

If your firm's production function has constant returns to scale, then if you double all your inputs, your firm's output will

Accepted Answer

A) double and productivity will rise. 
B) double but productivity will not change. 
C) more than double and productivity will rise. 
D) more then double but productivity will not change. 
A) double and productivity will rise. 
B) double but productivity will not change. 
C) more than double and productivity will rise. 
D) more then double but productivity will not change.

Question 19

You bake cookies. One day you double the time you spend, double the number of chocolate chips, flour, eggs, and all your other inputs, and bake twice as many cookies. Your cookie production function has

Accepted Answer

A) decreasing returns to scale. 
B) zero returns to scale. 
C) constant returns to scale. 
D) increasing returns to scale. 
A) decreasing returns to scale. 
B) zero returns to scale. 
C) constant returns to scale. 
D) increasing returns to scale.

Question 20

If a country were to increase its saving rate, then in the long run it would also increase its

Accepted Answer

A) level of income. 
B) growth rate of income. 
C) growth rate of productivity. 
D) All of the above are correct. 
A) level of income. 
B) growth rate of income. 
C) growth rate of productivity. 
D) All of the above are correct.

Exam 25: Production and Growth

In the United States over the past century, real GDP per person has grown by about __________ percent per year.

Which of the following is correct?

Over the last century, U.S. real GDP per person grew at a rate of about

When Chile experiences investment from abroad, it experiences, as a result,

Human capital is the term economists use to refer to the knowledge and skills that workers acquire through education, training, and experience.

If a country's saving rate increases, then in the long run

If your firm's production function has constant returns to scale and you increase all your inputs by 60%, then your firm's output will

When a country removes trade barriers and imports appliances and exports engineering services,

Other things the same, which of the following would increase productivity?

Both the standard of living and the growth of real GDP per person vary widely across countries.

Measured in 2014 dollars, real GDP per person in the United States in 2014 was about

In 2011, the imaginary nation of Maconia had a population of 8,200 and real GDP of 210,500. Maconia had 5% growth in real GDP per person. In 2012 it had a population of 8,400. To the nearest dollar what was real GDP in Maconia in 2012?

​The rate of real economic growth

Which of the following statements is not correct?

Accumulating capital

If your firm's production function has constant returns to scale, then if you double all your inputs, your firm's output will

You bake cookies. One day you double the time you spend, double the number of chocolate chips, flour, eggs, and all your other inputs, and bake twice as many cookies. Your cookie production function has

If a country were to increase its saving rate, then in the long run it would also increase its

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

The rate of real economic growth