Question 1

According to neoclassical growth theory, the higher real GDP per person from economic growth will

Accepted Answer

A)  not last because the population will increase. 
B)  last because there is no link between growth and population. 
C)  last indefinitely regardless of any other factor. 
D)  last as long as technological change continues. 
A)  not last because the population will increase. 
B)  last because there is no link between growth and population. 
C)  last indefinitely regardless of any other factor. 
D)  last as long as technological change continues.

Question 2

Activities that encourage faster growth are

Accepted Answer

A)  investment in new capital and human capital. 
B)  high levels of consumption and low levels of savings. 
C)  taxes on saving that serve to encourage more spending and less saving. 
D)  developing trade barriers to protect national industries. 
A)  investment in new capital and human capital. 
B)  high levels of consumption and low levels of savings. 
C)  taxes on saving that serve to encourage more spending and less saving. 
D)  developing trade barriers to protect national industries.

Question 3

"Why India Cannot Sustain High Economic Growth", by Kunal KumarKundu In his article about India's prospects for growth, the author notes that "Per capita availability of food grain is falling as population is growing faster than food grain production. Deplorable rural infrastructure leads to India wasting an amount of food grain... . India's agriculture is still so very highly monsoon dependent..."
Www)rediff.com 5/29/2008
If the author is suggesting that India's growth prospects are explained by the classical growth theory, we also expect that

Accepted Answer

A)  real GDP per worker will increase. 
B)  the subsistence wage will increase. 
C)  the economy will perpetually grow. 
D)  labor productivity, which has risen in recent years, will eventually decline. 
A)  real GDP per worker will increase. 
B)  the subsistence wage will increase. 
C)  the economy will perpetually grow. 
D)  labor productivity, which has risen in recent years, will eventually decline.

Question 4

What factors raise the productivity of labor?

Accepted Answer

The productivity of labor is affected by

Question 5

-The country of Kemper is on its aggregate production function at point W in the above figure. If the population increases with no change in capital or technology, the economy will

Accepted Answer

A)  move to point such as Y. 
B)  remain at point W. 
C)  move to point such as X. 
D)  move to point such as Z. 
A)  move to point such as Y. 
B)  remain at point W. 
C)  move to point such as X. 
D)  move to point such as Z.

Question 6

Of the following Asian countries, which has the lowest level of real GDP per person?

Accepted Answer

A)  China 
B)  Korea 
C)  Singapore 
D)  Hong Kong 
A)  China 
B)  Korea 
C)  Singapore 
D)  Hong Kong

Question 7

If the price level rises by 3 percent and workers' money wages increase by 3 percent, then the

Accepted Answer

A)  quantity of labor demand will decrease. 
B)  quantity of labor demand will increase. 
C)  quantity of labor demanded does not change because there is no change in the real wage rate. 
D)  Any of the above could occur depending on the magnitude on the dollar increase in the price level versus the dollar increase in the wage rate. 
A)  quantity of labor demand will decrease. 
B)  quantity of labor demand will increase. 
C)  quantity of labor demanded does not change because there is no change in the real wage rate. 
D)  Any of the above could occur depending on the magnitude on the dollar increase in the price level versus the dollar increase in the wage rate.

Question 8

The supply of labor curve is

Accepted Answer

A)  vertical at potential GDP. 
B)  upward sloping. 
C)  downward sloping. 
D)  horizontal at the equilibrium wage rate. 
A)  vertical at potential GDP. 
B)  upward sloping. 
C)  downward sloping. 
D)  horizontal at the equilibrium wage rate.

Question 9

A key feature of the new growth theory is the assumption of

Accepted Answer

A)  diminishing returns to labor. 
B)  diminishing returns to knowledge. 
C)  no diminishing returns to knowledge. 
D)  no diminishing returns to labor. 
A)  diminishing returns to labor. 
B)  diminishing returns to knowledge. 
C)  no diminishing returns to knowledge. 
D)  no diminishing returns to labor.

Question 10

According to the Economic Times (09/2012), Standard & Poor's forecast for India's GDP growth rate was cut by 1 percentage point to 5.5 percent as the entire Asia Pacific region feels the pressure of ongoing economic uncertainty. India has averaged 7 percent growth in GDP since 1997. Based on this story, it is most likely that the slowdown reflects a

Accepted Answer

A)  temporary business cycle slowdown. 
B)  temporary business cycle expansion. 
C)  change to India's long-term economic growth rate. 
D)  shrinkage of India's economy. 
A)  temporary business cycle slowdown. 
B)  temporary business cycle expansion. 
C)  change to India's long-term economic growth rate. 
D)  shrinkage of India's economy.

Question 11

According to UNESCO reporting, "Governments in North America and Western Europe invested the highest shares of national resources in education: 5.6 percent of GDP." As a result, we would expect ________, all else held constant. www.worldometers.info

Accepted Answer

A)  higher economic growth rates in these countries compared to other countries 
B)  lower economic growth rates in the countries because fewer resources can be devoted to innovation 
C)  lower research and development spending and lower economic growth unless the governments can raise taxes 
D)  lower saving rates and slower economic growth 
A)  higher economic growth rates in these countries compared to other countries 
B)  lower economic growth rates in the countries because fewer resources can be devoted to innovation 
C)  lower research and development spending and lower economic growth unless the governments can raise taxes 
D)  lower saving rates and slower economic growth

Question 12

The labor demand curve slopes downward because

Accepted Answer

A)  the firm maximizes profits by hiring more labor when the real wage rate rises. 
B)  workers supply more hours of work when the real wage rate rises. 
C)  the firm maximizes profits by hiring more labor when the real wage rate falls. 
D)  workers supply fewer hours of work when the real wage rate rises. 
A)  the firm maximizes profits by hiring more labor when the real wage rate rises. 
B)  workers supply more hours of work when the real wage rate rises. 
C)  the firm maximizes profits by hiring more labor when the real wage rate falls. 
D)  workers supply fewer hours of work when the real wage rate rises.

Question 13

-In the above figure, what is the full-employment real wage rate and quantity of hours per year?

Accepted Answer

A)  $40 and 60 billion hours per year 
B)  $50 and 100 billion hours per year 
C)  $35 and 100 billion hours per year 
D)  $50 and 40 billion hours per year 
A)  $40 and 60 billion hours per year 
B)  $50 and 100 billion hours per year 
C)  $35 and 100 billion hours per year 
D)  $50 and 40 billion hours per year

Question 14

The real wage rate will fall if the

Accepted Answer

A)  labor supply curve shifts rightward and the labor demand curve does not shift. 
B)  labor supply curve shifts leftward and the labor demand curve does not shift. 
C)  labor demand curve shifts rightward and the labor supply curve does not shift. 
D)  labor demand curve shifts rightward more than the labor supply curve shifts rightward. 
A)  labor supply curve shifts rightward and the labor demand curve does not shift. 
B)  labor supply curve shifts leftward and the labor demand curve does not shift. 
C)  labor demand curve shifts rightward and the labor supply curve does not shift. 
D)  labor demand curve shifts rightward more than the labor supply curve shifts rightward.

Question 15

Over the past 100 years, in the United States the average growth rate of ________ grew at a faster rate than ________.

Accepted Answer

A)  real GDP; nominal GDP 
B)  the population; real GDP 
C)  real GDP; the population 
D)  inflation; real GDP 
A)  real GDP; nominal GDP 
B)  the population; real GDP 
C)  real GDP; the population 
D)  inflation; real GDP

Question 16

An increase in physical capital or a technological advance

Accepted Answer

A)  raises the real wage rate. 
B)  decreases the quantity of labor employed. 
C)  shifts the production function downward. 
D)  decreases demand for labor. 
A)  raises the real wage rate. 
B)  decreases the quantity of labor employed. 
C)  shifts the production function downward. 
D)  decreases demand for labor.

Question 17

As labor increases, there is a

Accepted Answer

A)  shift of the aggregate production function, but no movement along it. 
B)  movement along the aggregate production function, but no shift in it. 
C)  movement along the aggregate production function and real GDP will increase less with each additional increase in labor. 
D)  movement along the aggregate production function and real GDP will decrease less with each additional increase in labor. 
A)  shift of the aggregate production function, but no movement along it. 
B)  movement along the aggregate production function, but no shift in it. 
C)  movement along the aggregate production function and real GDP will increase less with each additional increase in labor. 
D)  movement along the aggregate production function and real GDP will decrease less with each additional increase in labor.

Question 18

The real wage rate equals

Accepted Answer

A)  (money wage rate)/(price level). 
B)  (price level)/(money wage rate). 
C)  (money wage rate) × (price level). 
D)  (money wage) + (number of hours worked)/(price level). 
A)  (money wage rate)/(price level). 
B)  (price level)/(money wage rate). 
C)  (money wage rate) × (price level). 
D)  (money wage) + (number of hours worked)/(price level).

Question 19

Real GDP per person is slowly converging around the world.

Accepted Answer

A) True 
 B)False

Question 20

An aggregate production function shows the relationship between

Accepted Answer

A)  real GDP and leisure. 
B)  real GDP and the quantity of labor employed. 
C)  leisure and unemployment. 
D)  real GDP and unemployment. 
A)  real GDP and leisure. 
B)  real GDP and the quantity of labor employed. 
C)  leisure and unemployment. 
D)  real GDP and unemployment.

According to neoclassical growth theory, the higher real GDP per person from economic growth will

Activities that encourage faster growth are

What factors raise the productivity of labor?

-The country of Kemper is on its aggregate production function at point W in the above figure. If the population increases with no change in capital or technology, the economy will

Of the following Asian countries, which has the lowest level of real GDP per person?

If the price level rises by 3 percent and workers' money wages increase by 3 percent, then the

The supply of labor curve is

A key feature of the new growth theory is the assumption of

According to UNESCO reporting, "Governments in North America and Western Europe invested the highest shares of national resources in education: 5.6 percent of GDP." As a result, we would expect ________, all else held constant. www.worldometers.info

The labor demand curve slopes downward because

-In the above figure, what is the full-employment real wage rate and quantity of hours per year?

The real wage rate will fall if the

Over the past 100 years, in the United States the average growth rate of grew at a faster rate than .

An increase in physical capital or a technological advance

As labor increases, there is a

The real wage rate equals

Real GDP per person is slowly converging around the world.

An aggregate production function shows the relationship between

What Is Economics

The Economic Problem

Demand and Supply

Measuring Gdp and Economic Growth

Monitoring Jobs and Inflation

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers

The Business Cycle, Inflation, and Deflation

Fiscal Policy

Monetary Policy

International Trade Policy

Filters

Exam 6: Economic Growth

According to neoclassical growth theory, the higher real GDP per person from economic growth will

Activities that encourage faster growth are

What factors raise the productivity of labor?

-The country of Kemper is on its aggregate production function at point W in the above figure. If the population increases with no change in capital or technology, the economy will

Of the following Asian countries, which has the lowest level of real GDP per person?

If the price level rises by 3 percent and workers' money wages increase by 3 percent, then the

The supply of labor curve is

A key feature of the new growth theory is the assumption of

According to UNESCO reporting, "Governments in North America and Western Europe invested the highest shares of national resources in education: 5.6 percent of GDP." As a result, we would expect ________, all else held constant. www.worldometers.info

The labor demand curve slopes downward because

-In the above figure, what is the full-employment real wage rate and quantity of hours per year?

The real wage rate will fall if the

Over the past 100 years, in the United States the average growth rate of ________ grew at a faster rate than ________.

An increase in physical capital or a technological advance

As labor increases, there is a

The real wage rate equals

Real GDP per person is slowly converging around the world.

An aggregate production function shows the relationship between

What Is Economics

The Economic Problem

Demand and Supply

Measuring Gdp and Economic Growth

Monitoring Jobs and Inflation

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers

The Business Cycle, Inflation, and Deflation

Fiscal Policy

Monetary Policy

International Trade Policy

Filters

Over the past 100 years, in the United States the average growth rate of grew at a faster rate than .