Question 1

According to the convergence hypothesis, as a country grows wealthier, its productivity growth rate will slow down.

Accepted Answer

A) True 
 B)False

Question 2

The productivity speed-up in the United States began in the

Accepted Answer

A)  mid-1970s. 
B)  mid-1980s. 
C)  mid-1990s. 
D)  beginning of 2001. 
A)  mid-1970s. 
B)  mid-1980s. 
C)  mid-1990s. 
D)  beginning of 2001.

Question 3

The school of engineering at a modern university would be a supporter of the new

Accepted Answer

A)  consumption theory. 
B)  growth theory. 
C)  monetary theory. 
D)  construction theory. 
A)  consumption theory. 
B)  growth theory. 
C)  monetary theory. 
D)  construction theory.

Question 4

Compared with the United States, developing countries

Accepted Answer

A)  face geographic conditions that limit productivity. 
B)  have universal health care that prevent the spread of diseases. 
C)  have more political stability. 
D)  have higher levels of educational attainment. 
A)  face geographic conditions that limit productivity. 
B)  have universal health care that prevent the spread of diseases. 
C)  have more political stability. 
D)  have higher levels of educational attainment.

Question 5

If a larger percentage of Americans attended college, the wage premium would probably

Accepted Answer

A)  continue rising. 
B)  continue falling. 
C)  rise. 
D)  fall. 
A)  continue rising. 
B)  continue falling. 
C)  rise. 
D)  fall.

Question 6

Countries that adopt the most advanced technologies will have

Accepted Answer

A)  stagnant labor productivity. 
B)  highly productive labor and capital. 
C)  decreasing profitability. 
D)  constant returns to scale. 
A)  stagnant labor productivity. 
B)  highly productive labor and capital. 
C)  decreasing profitability. 
D)  constant returns to scale.

Question 7

The U.S. labor productivity speed-up of 1995-2010 could be explained by

Accepted Answer

A)  the delayed adoption and familiarization with technology. 
B)  increases in government spending. 
C)  reductions in the real interest rate. 
D)  higher wages. 
A)  the delayed adoption and familiarization with technology. 
B)  increases in government spending. 
C)  reductions in the real interest rate. 
D)  higher wages.

Question 8

A country's level of productivity determines its

Accepted Answer

A)  productivity growth rate. 
B)  rate of population growth. 
C)  current standard of living. 
D)  future income potential. 
A)  productivity growth rate. 
B)  rate of population growth. 
C)  current standard of living. 
D)  future income potential.

Question 9

These educational fields contribute to the advancement of technology in

Accepted Answer

A)  scientific, engineering, and managerial education. 
B)  medical, mathematics, engineering. 
C)  chemistry, biology, computer science. 
D)  the liberal arts. 
A)  scientific, engineering, and managerial education. 
B)  medical, mathematics, engineering. 
C)  chemistry, biology, computer science. 
D)  the liberal arts.

Question 10

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 11

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 12

From 1973 to 1995, productivity of labor in the United States

Accepted Answer

A)  declined because of reduced capital formation. 
B)  declined because of slower technological improvement. 
C)  increased because of expanded technological improvement. 
D)  increased because of lower gasoline prices. 
A)  declined because of reduced capital formation. 
B)  declined because of slower technological improvement. 
C)  increased because of expanded technological improvement. 
D)  increased because of lower gasoline prices.

Question 13

An explanation for the slowdown in U.S. productivity growth in the 1973-1995 period was higher oil prices caused by

Accepted Answer

A)  the CIA. 
B)  the WTO. 
C)  the IMF. 
D)  OPEC. 
A)  the CIA. 
B)  the WTO. 
C)  the IMF. 
D)  OPEC.

Question 14

Which of the following does not hinder growth in developing countries?

Accepted Answer

A)  Education 
B)  Disease 
C)  Instable governance 
D)  Geography 
A)  Education 
B)  Disease 
C)  Instable governance 
D)  Geography

Question 15

Identify the main reason to expect convergence in the long run.

Accepted Answer

A)  Low-productivity countries learning from high-productivity countries 
B)  Rapid growth in the supply of capital in low-productivity countries 
C)  Educational attainment rising quickly in low-productivity countries 
D)  Economic complacency and mismanagement in high-productivity countries 
A)  Low-productivity countries learning from high-productivity countries 
B)  Rapid growth in the supply of capital in low-productivity countries 
C)  Educational attainment rising quickly in low-productivity countries 
D)  Economic complacency and mismanagement in high-productivity countries

Question 16

Which of the following is not a reason used to explain the slowdown in productivity in the United States?

Accepted Answer

A)  The lack of savings in the 1980s and early 1990s 
B)  High energy prices in the 1970s 
C)  Competition from China and Japan 
D)  Inadequate workforce skills 
A)  The lack of savings in the 1980s and early 1990s 
B)  High energy prices in the 1970s 
C)  Competition from China and Japan 
D)  Inadequate workforce skills

Question 17

How is human capital most commonly measured?

Accepted Answer

A)  By the organizational rank and seniority 
B)  By the amount of pay and incentives 
C)  By the amount of education and training 
D)  By the compensation structure and work policies 
A)  By the organizational rank and seniority 
B)  By the amount of pay and incentives 
C)  By the amount of education and training 
D)  By the compensation structure and work policies

Question 18

Which of the following countries would find it easiest to achieve rapid growth in per capita GDP?

Accepted Answer

A)  United States 
B)  United Kingdom 
C)  France 
D)  Mexico 
A)  United States 
B)  United Kingdom 
C)  France 
D)  Mexico

Question 19

When compared to the price of laptop computers, college tuition in the United States has

Accepted Answer

A)  fallen. 
B)  risen. 
C)  stayed the same. 
D)  risen at the same rate as the CPI. 
A)  fallen. 
B)  risen. 
C)  stayed the same. 
D)  risen at the same rate as the CPI.

Question 20

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

Accepted Answer

A) True 
 B)False

Exam 23: Economic Growth: Theory and Policy

According to the convergence hypothesis, as a country grows wealthier, its productivity growth rate will slow down.

The productivity speed-up in the United States began in the

The school of engineering at a modern university would be a supporter of the new

Compared with the United States, developing countries

If a larger percentage of Americans attended college, the wage premium would probably

Countries that adopt the most advanced technologies will have

The U.S. labor productivity speed-up of 1995-2010 could be explained by

A country's level of productivity determines its

These educational fields contribute to the advancement of technology in

The profitability of an investment project will increase if

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

From 1973 to 1995, productivity of labor in the United States

An explanation for the slowdown in U.S. productivity growth in the 1973-1995 period was higher oil prices caused by

Which of the following does not hinder growth in developing countries?

Identify the main reason to expect convergence in the long run.

Which of the following is not a reason used to explain the slowdown in productivity in the United States?

How is human capital most commonly measured?

Which of the following countries would find it easiest to achieve rapid growth in per capita GDP?

When compared to the price of laptop computers, college tuition in the United States has

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

What Is Economics

The Economy: Myth and Reality

The Fundamental Economic Problem: Scarcity and Choice

Supply and Demand: an Initial Look

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

Contemporary Issues in the Us Economy

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