Question 1

A competitive market system promotes growth by providing producers with market signals on which to base investment and production decisions.

Accepted Answer

A) True 
 B)False

Question 2

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

Accepted Answer

A) information cascades. 
B) learning effects. 
C) network effects. 
D) scale economies. 
A) information cascades. 
B) learning effects. 
C) network effects. 
D) scale economies.

Question 3

Economies of scale refers to

Accepted Answer

A) the idea that proprietorships are less bureaucratic and therefore more efficient than corporations. 
B) public investments in highways, schools, utilities, and such. 
C) the fact that large producers may be able to use more efficient technologies than smaller producers. 
D) the reallocation of labor from less-productive to more-productive uses. 
A) the idea that proprietorships are less bureaucratic and therefore more efficient than corporations. 
B) public investments in highways, schools, utilities, and such. 
C) the fact that large producers may be able to use more efficient technologies than smaller producers. 
D) the reallocation of labor from less-productive to more-productive uses.

Question 4

Network effects are

Accepted Answer

A) increases in the value of a product to each user, including existing users, as the total number of users rises. 
B) reductions in per-unit production cost as firms learn by doing. 
C) increases in demand resulting from products being mentioned positively in a television program. 
D) the change in real GDP resulting from a change in investment or government spending. 
A) increases in the value of a product to each user, including existing users, as the total number of users rises. 
B) reductions in per-unit production cost as firms learn by doing. 
C) increases in demand resulting from products being mentioned positively in a television program. 
D) the change in real GDP resulting from a change in investment or government spending.

Question 5

The factor accounting for the largest increase in the productivity of labor in the United States has been

Accepted Answer

A) the education and training of workers. 
B) improved resource allocation. 
C) the quantity of capital. 
D) technological advance. 
A) the education and training of workers. 
B) improved resource allocation. 
C) the quantity of capital. 
D) technological advance.

Question 6

Many economists studying the productivity-growth patterns in the U.S.believe that in the period 1995-2010, the productivity of labor in the nation

Accepted Answer

A) benefited from a significant wave of technological advance, coupled with global competition. 
B) suffered severely from global competition and outsourcing. 
C) was not much affected by external and technological forces, continuing on at a steady rate as before. 
D) weakened from the rising economic powers of other nations like China and India. 
A) benefited from a significant wave of technological advance, coupled with global competition. 
B) suffered severely from global competition and outsourcing. 
C) was not much affected by external and technological forces, continuing on at a steady rate as before. 
D) weakened from the rising economic powers of other nations like China and India.

Question 7

The ability to expand production is sufficient for a nation to achieve maximum possible growth.

Accepted Answer

A) True 
 B)False

Question 8

Labor productivity = worker-hours/real GDP.

Accepted Answer

A) True 
 B)False

Question 9

(Consider This) The main point of the Consider This box about hypothetical countries Slogo, Sumgo, and Speedo is that over several decades, differing

Accepted Answer

A) inflation rates create large differences in real GDP per capita. 
B) economic growth rates create large differences in real GDP per capita. 
C) ratios of defense spending to GDP create large differences in real GDP per capita. 
D) unemployment rates create large differences in real GDP per capita. 
A) inflation rates create large differences in real GDP per capita. 
B) economic growth rates create large differences in real GDP per capita. 
C) ratios of defense spending to GDP create large differences in real GDP per capita. 
D) unemployment rates create large differences in real GDP per capita.

Question 10

Real GDP per capita is found by

Accepted Answer

A) adding real GDP and population. 
B) subtracting population from real GDP. 
C) dividing real GDP by population. 
D) dividing population by real GDP. 
A) adding real GDP and population. 
B) subtracting population from real GDP. 
C) dividing real GDP by population. 
D) dividing population by real GDP.

Question 11

In the growth debate, critics of economic growth define "making a better living" as identical to "the good life."

Accepted Answer

A) True 
 B)False

Question 12

Economic historians date the start of the Industrial Revolution around the year 1776, when James Watt

Accepted Answer

A) built the first factory for mass production. 
B) invented the steam locomotive. 
C) successfully lobbied British Parliament for the enactment of patent legislation to protect new inventions. 
D) invented and built a more powerful and efficient steam engine. 
A) built the first factory for mass production. 
B) invented the steam locomotive. 
C) successfully lobbied British Parliament for the enactment of patent legislation to protect new inventions. 
D) invented and built a more powerful and efficient steam engine.

Question 13

About what percentage of the growth in real output in the United States from 2007 to 2015 was due to increases in labor productivity?

Accepted Answer

A) about 25 percent 
B) about 33.3 percent 
C) roughly 50 percent 
D) almost 100 percent 
A) about 25 percent 
B) about 33.3 percent 
C) roughly 50 percent 
D) almost 100 percent

Question 14

Suppose that an economy's labor productivity and total worker-hours each grew by 4 percent between year 1 and year 2.We could conclude that this economy's

Accepted Answer

A) real GDP also increased by 4 percent. 
B) real GDP remained constant. 
C) production possibilities curve shifted outward. 
D) capital stock increased by 4 percent. 
A) real GDP also increased by 4 percent. 
B) real GDP remained constant. 
C) production possibilities curve shifted outward. 
D) capital stock increased by 4 percent.

Question 15

Suppose total output (real GDP) is $4,000 and labor productivity is $8.We can conclude that

Accepted Answer

A) real GDP per capita must be $500. 
B) the price-level index must be greater than 100. 
C) nominal GDP must be $500. 
D) the number of worker-hours must be 500. 
A) real GDP per capita must be $500. 
B) the price-level index must be greater than 100. 
C) nominal GDP must be $500. 
D) the number of worker-hours must be 500.

Question 16

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

Accepted Answer

A) True 
 B)False

Question 17

Critics of economic growth say studies show that people are not interested in achieving higher standards of living.

Accepted Answer

A) True 
 B)False

Question 18

Increases in the quantity and quality of human resources.Which set of items in the accompanying list would shift an economy's production possibilities curve outward?

Accepted Answer

A) 2, 5, and 6 only 
B) 2, 4, 5, and 6 only 
C) 1, 2, 5, and 6 only 
D) 1, 3, and 4 only 
A) 2, 5, and 6 only 
B) 2, 4, 5, and 6 only 
C) 1, 2, 5, and 6 only 
D) 1, 3, and 4 only

Question 19

Which of the following is a true statement?

Accepted Answer

A) Economists who support economic growth say that it is the most practical route to the higher standards of living that the vast majority of people desire. 
B) Most economists believe that the recent rise in the average rate of productivity growth implies an end to the business cycle. 
C) Most economists believe that increases in real GDP actually produce decreases in overall economic well-being because of spillover costs. 
D) Mainstream economists disagree as to whether the rate of productivity growth was higher between 1995 and 2010 or between 1973 and 1995. 
A) Economists who support economic growth say that it is the most practical route to the higher standards of living that the vast majority of people desire. 
B) Most economists believe that the recent rise in the average rate of productivity growth implies an end to the business cycle. 
C) Most economists believe that increases in real GDP actually produce decreases in overall economic well-being because of spillover costs. 
D) Mainstream economists disagree as to whether the rate of productivity growth was higher between 1995 and 2010 or between 1973 and 1995.

Question 20

Supply factors in economic growth include the following, except

Accepted Answer

A) improvements in technology. 
B) expansion of capital stock. 
C) increases in purchases of output. 
D) better education and training. 
A) improvements in technology. 
B) expansion of capital stock. 
C) increases in purchases of output. 
D) better education and training.

Exam 28: Economic Growth

A competitive market system promotes growth by providing producers with market signals on which to base investment and production decisions.

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

Economies of scale refers to

Network effects are

The factor accounting for the largest increase in the productivity of labor in the United States has been

Many economists studying the productivity-growth patterns in the U.S.believe that in the period 1995-2010, the productivity of labor in the nation

The ability to expand production is sufficient for a nation to achieve maximum possible growth.

Labor productivity = worker-hours/real GDP.

(Consider This) The main point of the Consider This box about hypothetical countries Slogo, Sumgo, and Speedo is that over several decades, differing

Real GDP per capita is found by

In the growth debate, critics of economic growth define "making a better living" as identical to "the good life."

Economic historians date the start of the Industrial Revolution around the year 1776, when James Watt

About what percentage of the growth in real output in the United States from 2007 to 2015 was due to increases in labor productivity?

Suppose that an economy's labor productivity and total worker-hours each grew by 4 percent between year 1 and year 2.We could conclude that this economy's

Suppose total output (real GDP) is $4,000 and labor productivity is $8.We can conclude that

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

Critics of economic growth say studies show that people are not interested in achieving higher standards of living.

Increases in the quantity and quality of human resources.Which set of items in the accompanying list would shift an economy's production possibilities curve outward?

Which of the following is a true statement?

Supply factors in economic growth include the following, except

Limits, Alternatives, and Choices

The Market System and the Circular Flow

Demand, Supply, and Market Equilibrium

Market Failures: Public Goods and Externalities

Governments Role and Government Failure

Elasticity

Utility Maximization

Behavioral Economics

Businesses and the Costs of Production

Pure Competition in the Short Run

Pure Competition in the Long Run

Pure Monopoly

Monopolistic Competition

Oligopoly and Strategic Behavior

Technology, Rd, and Efficiency

The Demand for Resources

Wage Determination

Rent, Interest, and Profit

Natural Resource and Energy Economics

Public Finance: Expenditures and Taxes

Antitrust Policy and Regulation

Agriculture: Economics and Policy

Income Inequality, Poverty, and Discrimination

Health Care

Immigration

An Introduction to Macroeconomics

Measuring Domestic Output and National Income

Business Cycles, Unemployment, and Inflation

Basic Macroeconomic Relationships

The Aggregate Expenditures Model

Aggregate Demand and Aggregate Supply

Fiscal Policy, Deficits, and Debt

Money, Banking, and Financial Institutions

Money Creation

Interest Rates and Monetary Policy

Financial Economics

Extending the Analysis of Aggregate Supply

Current Issues in Macro Theory and Policy

International Trade

The Balance of Payments, Exchange Rates, and Trade Deficits

The Economics of Developing Countries

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