Question 1

One major economic beneﬁt of global competition is

Accepted Answer

A)  lower unemployment. 
B)  increased protection of domestic ﬁrms. 
C)  pressure to innovate. 
D)  more leisure opportunities. 
A)  lower unemployment. 
B)  increased protection of domestic ﬁrms. 
C)  pressure to innovate. 
D)  more leisure opportunities.

Question 2

For comparing changes in potential military strength and political preeminence, the most meaningful measure of economic growth would be changes in

Accepted Answer

A)  total nominal output. 
B)  total real output. 
C)  per capita output. 
D)  per family output. 
A)  total nominal output. 
B)  total real output. 
C)  per capita output. 
D)  per family output.

Question 3

Which of the following explanations is consistent with the decline in productivity growth that followed the Great Recession?

Accepted Answer

A)  High levels of debt incurred prior to the Great Recession have hindered ﬁrms' ability to make productivity-enhancing investments. 
B)  The Federal Reserve kept interest rates too high, stiﬂing investments that would increase productivity. 
C)  High levels of inﬂation following the Great Recession created too much uncertainty for ﬁrms, discouraging productivity-enhancing investments. 
D)  Consumer demand following the Great Recession exceeded ﬁrms' capacity to satisfy that demand. 
A)  High levels of debt incurred prior to the Great Recession have hindered ﬁrms' ability to make productivity-enhancing investments. 
B)  The Federal Reserve kept interest rates too high, stiﬂing investments that would increase productivity. 
C)  High levels of inﬂation following the Great Recession created too much uncertainty for ﬁrms, discouraging productivity-enhancing investments. 
D)  Consumer demand following the Great Recession exceeded ﬁrms' capacity to satisfy that demand.

Question 4

$$\begin{array} { | c | c | c | c | c | } 
\hline \text { Year } & \text { Alta (Real GDP) } & \text { Zorn (Real GDP) } & \text { Alta (Population) } & \text { Zorn (Population) } \
\hline 1 & \$ 2,000 & \$ 150,000 & 200 & 500 \
\hline 2 & 2,100 & 152,000 & 202 & 505 \
\hline 3 & 2,200 & 154,000 & 210 & 508 \
\hline
\end{array}$$ Refer to the table. Between years 1 and 2, real GDP grew by __________ percent in Alta.

Accepted Answer

A)  3 
B)  4 
C)  5 
D)  10 
A)  3 
B)  4 
C)  5 
D)  10

Question 5

$$\begin{array} { | c | c | c | } 
\hline \text { Year } & \text { Quantity of Labor } & \text { Productivity of Labor } \
\hline 1 & 2,000 & \$ 200 \
\hline 2 & 2,000 & 210 \
\hline 3 & 2,000 & 210 \
\hline
\end{array}$$ The table shows the quantity of labor (measured in hours) and the productivity of labor (measured in real GDP per hour) in a hypothetical economy in three different years. Between Year 2 and Year 3,
Real GDP increased by

Accepted Answer

A)  2 percent. 
B)  5 percent. 
C)  0 percent. 
D)  15 percent. 
A)  2 percent. 
B)  5 percent. 
C)  0 percent. 
D)  15 percent.

Question 6

Strong property rights are important for modern economic growth because

Accepted Answer

A)  they allow governments to extract the gains from private citizens' investments. 
B)  people are more likely to invest if they don't fear that others can take their returns on investment without compensation. 
C)  they ensure an equitable distribution of income. 
D)  business cycle ﬂuctuations will be smaller and less likely to disrupt investment patterns. 
A)  they allow governments to extract the gains from private citizens' investments. 
B)  people are more likely to invest if they don't fear that others can take their returns on investment without compensation. 
C)  they ensure an equitable distribution of income. 
D)  business cycle ﬂuctuations will be smaller and less likely to disrupt investment patterns.

Question 7

Refer to the graph. An increase in an economy's labor productivity would

Accepted Answer

A)  move the economy away from point A and toward point B. 
B)  move the economy away from point B and toward point A. 
C)  shift curve AB to CD. 
D)  shift curve CD to AB. 
A)  move the economy away from point A and toward point B. 
B)  move the economy away from point B and toward point A. 
C)  shift curve AB to CD. 
D)  shift curve CD to AB.

Question 8

Since the 1950s, the U.S. average annual rate of growth of real GDP was higher than the average
annual growth of real GDP per capita.

Accepted Answer

A) True 
 B)False

Question 9

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 10

One major aspect of the socio-cultural-political environment of the United States which has generally been conducive to economic growth is the

Accepted Answer

A)  enforcement of contracts by the market. 
B)  denial of the rights of property ownership. 
C)  favorable attitude toward work and risk-taking. 
D)  strict social regulation of production and progress. 
A)  enforcement of contracts by the market. 
B)  denial of the rights of property ownership. 
C)  favorable attitude toward work and risk-taking. 
D)  strict social regulation of production and progress.

Question 11

The "rule of 70" is a formula for determining the approximate number of

Accepted Answer

A)  years that it would take for a value (like real GDP) to expand 70 times. 
B)  years that it would take for a value (like real GDP) to double. 
C)  times a value (like real GDP) is a multiple of 70. 
D)  times one could double a certain value (like real GDP) over 70 years. 
A)  years that it would take for a value (like real GDP) to expand 70 times. 
B)  years that it would take for a value (like real GDP) to double. 
C)  times a value (like real GDP) is a multiple of 70. 
D)  times one could double a certain value (like real GDP) over 70 years.

Question 12

Which of the following is not an argument made by proponents of economic growth?

Accepted Answer

A)  Growth is the basic means of improving living standards. 
B)  It is easier to reduce poverty when the economy is growing than when it is not. 
C)  There is a direct relationship between a growing real GDP and rising pollution. 
D)  Growth provides an economic environment favorable to education and self-fulﬁllment. 
A)  Growth is the basic means of improving living standards. 
B)  It is easier to reduce poverty when the economy is growing than when it is not. 
C)  There is a direct relationship between a growing real GDP and rising pollution. 
D)  Growth provides an economic environment favorable to education and self-fulﬁllment.

Question 13

Modern economic growth since the 1820s has widened wealth and income disparities between
richer and poorer nations.

Accepted Answer

A) True 
 B)False

Question 14

Refer to the graph. An increase in the economy's human capital would

Accepted Answer

A)  move the economy away from point A and toward point B. 
B)  shift curve CD to AB. 
C)  move the economy away from point B and toward point A. 
D)  shift curve AB to CD. 
A)  move the economy away from point A and toward point B. 
B)  shift curve CD to AB. 
C)  move the economy away from point B and toward point A. 
D)  shift curve AB to CD.

Question 15

Between 1953 and 2018, rising labor productivity contributed more to U.S. economic growth than
did increases in inputs.

Accepted Answer

A) True 
 B)False

Question 16

Other things equal, if a full-employment economy reallocated a substantial quantity of its resources to capital goods, we would expect

Accepted Answer

A)  present consumption to rise. 
B)  future consumption to fall. 
C)  a lower rate of growth of real GDP. 
D)  labor productivity to rise. 
A)  present consumption to rise. 
B)  future consumption to fall. 
C)  a lower rate of growth of real GDP. 
D)  labor productivity to rise.

Question 17

Which of the following statements is true about productivity growth in the United States since the Great Recession?

Accepted Answer

A)  The productivity growth rate has stagnated to about 3 percent per year. 
B)  The productivity growth rate fell to 0.7 percent from 2010 to 2018. 
C)  Productivity growth grew as new products, particularly Internet apps, were introduced. 
D)  Firms have lacked the capacity to meet consumer demand, causing measured productivity to fall. 
A)  The productivity growth rate has stagnated to about 3 percent per year. 
B)  The productivity growth rate fell to 0.7 percent from 2010 to 2018. 
C)  Productivity growth grew as new products, particularly Internet apps, were introduced. 
D)  Firms have lacked the capacity to meet consumer demand, causing measured productivity to fall.

Question 18

Between 1950 and 2018, U.S. real GDP per capita grew at an average annual rate of about

Accepted Answer

A)  5.5 percent. 
B)  4.2 percent. 
C)  3.2 percent. 
D)  2.0 percent. 
A)  5.5 percent. 
B)  4.2 percent. 
C)  3.2 percent. 
D)  2.0 percent.

Question 19

(Consider This) According to the Consider This box on patents and innovation, the cost for U.S. and European drug companies to research, patent, and safety-test a new drug is about

Accepted Answer

A)  $100 million. 
B)  $750 million. 
C)  $1 billion. 
D)  $10 billion. 
A)  $100 million. 
B)  $750 million. 
C)  $1 billion. 
D)  $10 billion.

Question 20

The intense competition of free trade prevents the investment that generates economic growth.

Accepted Answer

A) True 
 B)False

One major economic beneﬁt of global competition is

For comparing changes in potential military strength and political preeminence, the most meaningful measure of economic growth would be changes in

Which of the following explanations is consistent with the decline in productivity growth that followed the Great Recession?

Year Alta (Real GDP) Zorn (Real GDP) Alta (Population) Zorn (Population) 1 \ 2,000 \ 150,000 200 500 2 2,100 152,000 202 505 3 2,200 154,000 210 508 Refer to the table. Between years 1 and 2, real GDP grew by __________ percent in Alta.

Strong property rights are important for modern economic growth because

Refer to the graph. An increase in an economy's labor productivity would

Since the 1950s, the U.S. average annual rate of growth of real GDP was higher than the average annual growth of real GDP per capita.

Economies of scale refers to

One major aspect of the socio-cultural-political environment of the United States which has generally been conducive to economic growth is the

The "rule of 70" is a formula for determining the approximate number of

Which of the following is not an argument made by proponents of economic growth?

Modern economic growth since the 1820s has widened wealth and income disparities between richer and poorer nations.

Refer to the graph. An increase in the economy's human capital would

Between 1953 and 2018, rising labor productivity contributed more to U.S. economic growth than did increases in inputs.

Other things equal, if a full-employment economy reallocated a substantial quantity of its resources to capital goods, we would expect

Which of the following statements is true about productivity growth in the United States since the Great Recession?

Between 1950 and 2018, U.S. real GDP per capita grew at an average annual rate of about

(Consider This) According to the Consider This box on patents and innovation, the cost for U.S. and European drug companies to research, patent, and safety-test a new drug is about

The intense competition of free trade prevents the investment that generates economic growth.

The Market System and the Circular Flow

Demand, Supply, and Market Equilibrium

Market Failures Caused by Externalities Asymmetric Information

Public Goods, Public Choice, and Government Failure

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

Filters

Exam 8: Economic Growth

One major economic beneﬁt of global competition is

For comparing changes in potential military strength and political preeminence, the most meaningful measure of economic growth would be changes in

Which of the following explanations is consistent with the decline in productivity growth that followed the Great Recession?

Year Alta (Real GDP) Zorn (Real GDP) Alta (Population) Zorn (Population) 1 \ 2,000 \ 150,000 200 500 2 2,100 152,000 202 505 3 2,200 154,000 210 508 Refer to the table. Between years 1 and 2, real GDP grew by __________ percent in Alta.

Strong property rights are important for modern economic growth because

Refer to the graph. An increase in an economy's labor productivity would

Since the 1950s, the U.S. average annual rate of growth of real GDP was higher than the average annual growth of real GDP per capita.

Economies of scale refers to

One major aspect of the socio-cultural-political environment of the United States which has generally been conducive to economic growth is the

The "rule of 70" is a formula for determining the approximate number of

Which of the following is not an argument made by proponents of economic growth?

Modern economic growth since the 1820s has widened wealth and income disparities between richer and poorer nations.

Refer to the graph. An increase in the economy's human capital would

Between 1953 and 2018, rising labor productivity contributed more to U.S. economic growth than did increases in inputs.

Other things equal, if a full-employment economy reallocated a substantial quantity of its resources to capital goods, we would expect

Which of the following statements is true about productivity growth in the United States since the Great Recession?

Between 1950 and 2018, U.S. real GDP per capita grew at an average annual rate of about

(Consider This) According to the Consider This box on patents and innovation, the cost for U.S. and European drug companies to research, patent, and safety-test a new drug is about

The intense competition of free trade prevents the investment that generates economic growth.

The Market System and the Circular Flow

Demand, Supply, and Market Equilibrium

Market Failures Caused by Externalities Asymmetric Information

Public Goods, Public Choice, and Government Failure

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

Filters