Question 1

The profitability of an investment project will increase if

Accepted Answer

A)  tax rates increase. 
B)  real interest rates increase. 
C)  real interest rates decrease. 
D)  business tax deductions decrease. 
A)  tax rates increase. 
B)  real interest rates increase. 
C)  real interest rates decrease. 
D)  business tax deductions decrease.

Question 2

Which of the following services have experienced declines in relative prices due to productivity increases?

Accepted Answer

A)  medical services 
B)  restaurant meals 
C)  theatrical performances 
D)  Internet access services 
A)  medical services 
B)  restaurant meals 
C)  theatrical performances 
D)  Internet access services

Question 3

When the difference between potential GDP and actual GDP increases, the nation usually suffers from increased inflation.

Accepted Answer

A) True 
 B)False

Question 4

The productivity slowdown in the U.S.can be explained by geographic limitations and instability in the government.

Accepted Answer

A) True 
 B)False

Question 5

A productivity decrease would be illustrated by a shift in the production function

Accepted Answer

A)  downward. 
B)  leftward. 
C)  upward. 
D)  rightward. 
A)  downward. 
B)  leftward. 
C)  upward. 
D)  rightward.

Question 6

Human capital includes the tools and equipment that human beings work with.

Accepted Answer

A) True 
 B)False

Question 7

A productivity increase is illustrated by a shift in the production function

Accepted Answer

A)  downward. 
B)  leftward. 
C)  upward. 
D)  rightward. 
A)  downward. 
B)  leftward. 
C)  upward. 
D)  rightward.

Question 8

Higher energy prices can be used to adequately explain the productivity slowdown in

Accepted Answer

A)  the United States and the rest of the world. 
B)  the United States but not the rest of the world. 
C)  the rest of the world but not the United States. 
D)  neither the United States nor the rest of the world. 
A)  the United States and the rest of the world. 
B)  the United States but not the rest of the world. 
C)  the rest of the world but not the United States. 
D)  neither the United States nor the rest of the world.

Question 9

On-the-job training is the one area of education in the United States most influenced by the

Accepted Answer

A)  business sector. 
B)  government sector. 
C)  household sector. 
D)  foreign sector. 
A)  business sector. 
B)  government sector. 
C)  household sector. 
D)  foreign sector.

Question 10

Mandated on-the-job training is seen in the United States mainly as a(n)

Accepted Answer

A)  useful spur to economic growth. 
B)  proper use of legislative power. 
C)  unwarranted governmental interference. 
D)  necessary requirement for increased productivity. 
A)  useful spur to economic growth. 
B)  proper use of legislative power. 
C)  unwarranted governmental interference. 
D)  necessary requirement for increased productivity.

Question 11

The prices of telecommunications services have decreased due to productivity increases.

Accepted Answer

A) True 
 B)False

Question 12

Poor health in developing countries encourages economic growth because working is a matter of life and death.

Accepted Answer

A) True 
 B)False

Question 13

The productivity slowdown in the U.S.from 1973 to 1995

Accepted Answer

A)  can be explained easily with economic theory. 
B)  continued into the third millennium. 
C)  still confuses economists. 
D)  was a continuation of the slowdown from 1948 to 1973. 
A)  can be explained easily with economic theory. 
B)  continued into the third millennium. 
C)  still confuses economists. 
D)  was a continuation of the slowdown from 1948 to 1973.

Question 14

A nation's capital stock is increased by increases in

Accepted Answer

A)  consumption spending. 
B)  government spending. 
C)  investment spending. 
D)  net exports. 
A)  consumption spending. 
B)  government spending. 
C)  investment spending. 
D)  net exports.

Question 15

The phrase "capital formation" is synonymous with

Accepted Answer

A)  investment spending. 
B)  buying shares of stock. 
C)  creating mutual funds. 
D)  purchasing financial assets. 
A)  investment spending. 
B)  buying shares of stock. 
C)  creating mutual funds. 
D)  purchasing financial assets.

Question 16

Discuss that factors that help explain the rapid productivity growth in the United States after 1995.

Accepted Answer

The following factors help explain the s

Question 17

More education and training usually lead to higher levels of

Accepted Answer

A)  productivity. 
B)  population. 
C)  pollution. 
D)  import protectionism. 
A)  productivity. 
B)  population. 
C)  pollution. 
D)  import protectionism.

Question 18

A nation's capital consists mainly of stocks, bonds, and other financial assets.

Accepted Answer

A) True 
 B)False

Question 19

The productivity speed-up of the 1950s and the 1960s could have been caused by

Accepted Answer

A)  wartime innovations. 
B)  civilian innovations after World War II. 
C)  industrial innovations spurred by the Korean and Vietnam conflicts. 
D)  decreases in the rate of population growth. 
A)  wartime innovations. 
B)  civilian innovations after World War II. 
C)  industrial innovations spurred by the Korean and Vietnam conflicts. 
D)  decreases in the rate of population growth.

Question 20

Technological change was a major contributor to the productivity speed-up from 1995-2000.

Accepted Answer

A) True 
 B)False

Exam 24: Economic Growth: Theory and Policy

The profitability of an investment project will increase if

Which of the following services have experienced declines in relative prices due to productivity increases?

When the difference between potential GDP and actual GDP increases, the nation usually suffers from increased inflation.

The productivity slowdown in the U.S.can be explained by geographic limitations and instability in the government.

A productivity decrease would be illustrated by a shift in the production function

Human capital includes the tools and equipment that human beings work with.

A productivity increase is illustrated by a shift in the production function

Higher energy prices can be used to adequately explain the productivity slowdown in

On-the-job training is the one area of education in the United States most influenced by the

Mandated on-the-job training is seen in the United States mainly as a(n)

The prices of telecommunications services have decreased due to productivity increases.

Poor health in developing countries encourages economic growth because working is a matter of life and death.

The productivity slowdown in the U.S.from 1973 to 1995

A nation's capital stock is increased by increases in

The phrase "capital formation" is synonymous with

Discuss that factors that help explain the rapid productivity growth in the United States after 1995.

More education and training usually lead to higher levels of

A nation's capital consists mainly of stocks, bonds, and other financial assets.

The productivity speed-up of the 1950s and the 1960s could have been caused by

Technological change was a major contributor to the productivity speed-up from 1995-2000.

What Is Economics?

The Economy: Myth and Reality

The Fundamental Economic Problem: Scarcity and Choice

Supply and Demand: An Initial Look

Consumer Choice: Individual and Market Demand

Demand and Elasticity

Production, Inputs, and Cost: Building Blocks for Supply Analysis

Output, Price, and Profit: The Importance of Marginal Analysis

Securities: Business Finance, and the Economy: The Tail that Wags the Dog?

The Firm and the Industry under Perfect Competition

Monopoly

Between Competition and Monopoly

Limiting Market Power: Regulation and Antitrust

The Case for Free Markets I: The Price System

The Shortcomings of Free Markets

The Market's Prime Achievement: Innovation and Growth

Externalities, the Environment, and Natural Resources

Taxation and Resource Allocation

Pricing the Factors of Production

Labor and Entrepreneurship: The Human Inputs

Poverty, Inequality, and Discrimination

An Introduction to Macroeconomics

The Goals of Macroeconomic Policy

Aggregate Demand and the Powerful Consumer

Demand-Side Equilibrium: Unemployment or Inflation?

Bringing in the Supply Side: Unemployment and Inflation?

Managing Aggregate Demand: Fiscal Policy

Money and the Banking System

Monetary Policy: Conventional and Unconventional

The Financial Crisis and the Great Recession

The Debate over Monetary and Fiscal Policy

Budget Deficits in the Short and Long Run

The Trade-Off between Inflation and Unemployment

International Trade and Comparative Advantage

The International Monetary System: Order or Disorder?

Exchange Rates and the Macroeconomy

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