Question 1

The catch-up effect is the idea that:

Accepted Answer

A) savings will always 'catch up' with investment spending 
B) other countries aid relatively poor countries so as to 'catch them up' 
C) it is easier for a country to grow fast if it starts out relatively poor 
D) if investment spending is low, increased savings will help investment to 'catch up' 
A) savings will always 'catch up' with investment spending 
B) other countries aid relatively poor countries so as to 'catch them up' 
C) it is easier for a country to grow fast if it starts out relatively poor 
D) if investment spending is low, increased savings will help investment to 'catch up' C

Question 2

Technological knowledge enables improved productivity.

Accepted Answer

A) True 
 B)False  True

Question 3

Which of the following countries have a history of providing political stability and property rights to international firms?

Accepted Answer

A) Italy, Australia, New Zealand 
B) Japan, Australia, The United Arab Emirates 
C) Malaysia, Congo and South Africa 
D) Australia, Cameroon, The United Arab Emirates 
A) Italy, Australia, New Zealand 
B) Japan, Australia, The United Arab Emirates 
C) Malaysia, Congo and South Africa 
D) Australia, Cameroon, The United Arab Emirates B

Question 4

Economists believe that governments that encourage research and development through their policies do it through which of the following methods?

Accepted Answer

A) protecting infant industries from overseas investment, public research funding 
B) a patent system, university research funding, conferring intellectual property rights 
C) a patent system, consumer subsidies, research funding 
D) decreased migration, intellectual property rights, government research funding 
A) protecting infant industries from overseas investment, public research funding 
B) a patent system, university research funding, conferring intellectual property rights 
C) a patent system, consumer subsidies, research funding 
D) decreased migration, intellectual property rights, government research funding

Question 5

Using the rule of 70, calculate approximately how many years it would take for a country's real per-capita GDP to double if the growth rate is:
a.one per cent
b.two per cent
c.3.5 per cent
d.10 per cent
e.14 per cent

Accepted Answer

a.70 years
b.35 year

Question 6

The amount of goods and services produced from each hour of a worker's time is called:

Accepted Answer

A) output 
B) productivity 
C) work quality 
D) worker efficiency 
A) output 
B) productivity 
C) work quality 
D) worker efficiency

Question 7

Inward orientation policies, such as those in India between 1947 and 1993 have tended to:

Accepted Answer

A) maximise consumer benefit 
B) create a highly efficient use of production resources 
C) limit growth opportunities 
D) enable large amounts of tariff-free trade 
A) maximise consumer benefit 
B) create a highly efficient use of production resources 
C) limit growth opportunities 
D) enable large amounts of tariff-free trade

Question 8

Natural resources:

Accepted Answer

A) are inputs provided by nature 
B) are inputs such as land, rivers and mineral deposits 
C) take two forms - renewable and non-renewable 
D) all of the above 
E) only B and C 
A) are inputs provided by nature 
B) are inputs such as land, rivers and mineral deposits 
C) take two forms - renewable and non-renewable 
D) all of the above 
E) only B and C

Question 9

Which of the following statements is correct?

Accepted Answer

A) Technological knowledge is the society's understanding about how the world works, whereas human capital refers to the resources spent transmitting this understanding to the labour force 
B) Human capital is the society's understanding about how the world works, whereas technological knowledge refers to the resources spent transmitting this understanding to the labour force 
C) Technological knowledge is the bridge that links physical and natural resources to human capital 
D) Technological knowledge is the society's understanding about human capital 
A) Technological knowledge is the society's understanding about how the world works, whereas human capital refers to the resources spent transmitting this understanding to the labour force 
B) Human capital is the society's understanding about how the world works, whereas technological knowledge refers to the resources spent transmitting this understanding to the labour force 
C) Technological knowledge is the bridge that links physical and natural resources to human capital 
D) Technological knowledge is the society's understanding about human capital

Question 10

Technological progress does not depend on:

Accepted Answer

A) the quality of the education system 
B) the intellectual capabilities of the population 
C) the investment in research and development 
D) the availability of natural resources 
A) the quality of the education system 
B) the intellectual capabilities of the population 
C) the investment in research and development 
D) the availability of natural resources

Question 11

The education and training of workers is called

Accepted Answer

A) technological change 
B) technological progress 
C) human capital 
D) increasing returns to labour 
A) technological change 
B) technological progress 
C) human capital 
D) increasing returns to labour

Question 12

In some East Asian countries, such as Hong Kong, Singapore and Taiwan, average income has risen about ____ per cent per year in recent decades.

Accepted Answer

A) minus four per cent 
B) seven per cent 
C) minus seven per cent 
D) 18 per cent 
A) minus four per cent 
B) seven per cent 
C) minus seven per cent 
D) 18 per cent

Question 13

Firms bring in combinations of labour and capital to produce output.How much output can be produced from a given combination of labour and capital depends on: if the production function of a country has constant returns to scale and all input of the country has increased by 100 per cent, then its output would increase by:

Accepted Answer

A) mineral resources, raw materials availability and other production specifics 
B) primary factors of production 
C) capital stock, education and the skills of the work force 
D) the state of technology, managerial expertise, the skills of the work force and other factors 
A) mineral resources, raw materials availability and other production specifics 
B) primary factors of production 
C) capital stock, education and the skills of the work force 
D) the state of technology, managerial expertise, the skills of the work force and other factors

Question 14

An improvement in technology between two dates is called

Accepted Answer

A) innovation 
B) inventory investment 
C) invention 
D) technological process 
A) innovation 
B) inventory investment 
C) invention 
D) technological process

Question 15

If one of the primary factors of production is held constant, two-dimensional production functions typically have a curved shape that reflects the ____________ of the factor that is being allowed to vary.

Accepted Answer

A) increasing rate of saving 
B) diminishing marginal productivity 
C) increasing nominal GDP 
D) diminishing marginal utility 
A) increasing rate of saving 
B) diminishing marginal productivity 
C) increasing nominal GDP 
D) diminishing marginal utility

Question 16

Labour alone cannot produce sustained economic growth.

Accepted Answer

A) True 
 B)False

Question 17

Given a production function Y = AF(L, K, H, N), where Y is the quantity of output, L is the quantity of labour, H is the quantity of human capital and N is the quantity of natural resources, what does A represent?

Accepted Answer

A) Productivity growth 
B) The physical capital per worker 
C) The level of available production technology 
D) Technological growth 
A) Productivity growth 
B) The physical capital per worker 
C) The level of available production technology 
D) Technological growth

Question 18

Why is improving education important for technological progress?

Accepted Answer

If education can be improved,

Question 19

Holding the amount of capital constant, if firms increase the amount of labour they use, output increases at a diminishing rate, and this is the definition of:

Accepted Answer

A) diminishing marginal productivity of labour 
B) diminishing marginal utility of labour 
C) marginal revenue product of labour 
D) marginal product of labour 
A) diminishing marginal productivity of labour 
B) diminishing marginal utility of labour 
C) marginal revenue product of labour 
D) marginal product of labour

Question 20

Countries that devote a small share of GDP to investment, such as New Zealand, tend to have:

Accepted Answer

A) high growth rates 
B) stable growth rates 
C) low growth rates 
D) very cyclical growth rates 
A) high growth rates 
B) stable growth rates 
C) low growth rates 
D) very cyclical growth rates

Exam 26: Production and Growth

The catch-up effect is the idea that:

Technological knowledge enables improved productivity.

Which of the following countries have a history of providing political stability and property rights to international firms?

Economists believe that governments that encourage research and development through their policies do it through which of the following methods?

Using the rule of 70, calculate approximately how many years it would take for a country's real per-capita GDP to double if the growth rate is: a.one per cent b.two per cent c.3.5 per cent d.10 per cent e.14 per cent

The amount of goods and services produced from each hour of a worker's time is called:

Inward orientation policies, such as those in India between 1947 and 1993 have tended to:

Natural resources:

Which of the following statements is correct?

Technological progress does not depend on:

The education and training of workers is called

In some East Asian countries, such as Hong Kong, Singapore and Taiwan, average income has risen about ____ per cent per year in recent decades.

An improvement in technology between two dates is called

If one of the primary factors of production is held constant, two-dimensional production functions typically have a curved shape that reflects the ____________ of the factor that is being allowed to vary.

Labour alone cannot produce sustained economic growth.

Given a production function Y = AF(L, K, H, N), where Y is the quantity of output, L is the quantity of labour, H is the quantity of human capital and N is the quantity of natural resources, what does A represent?

Why is improving education important for technological progress?

Holding the amount of capital constant, if firms increase the amount of labour they use, output increases at a diminishing rate, and this is the definition of:

Countries that devote a small share of GDP to investment, such as New Zealand, tend to have:

Ten Lessons From 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

Application: 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

Business Strategy and Oligopoly

Competition Policy

The Markets for the Factors of Production

Earnings, Unions and Discrimination

Income Inequity and Poverty

The Theory of Consumer Choice

Frontiers of Microeconomics

Measuring a Nations Income

Measuring the Cost of Living

Saving, Investment and the Financial System

The Natural Rate of Unemployment

The Monetary System

Inflation: Its Causes and Costs

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 Trade-Off Between Inflation and Unemployment

Global Financial Crisis of 2008 and Beyond

Five Debates Over Macroeconomic Policy

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