Question 1

Which of the following countries has the lowest level of average educational attainment?

Accepted Answer

A)  Canada 
B)  Italy 
C)  India 
D)  Sudan 
A)  Canada 
B)  Italy 
C)  India 
D)  Sudan

Question 2

Two of the three pillars of labor productivity growth responsible for the changes in the United States after 1995 are technological change and

Accepted Answer

A)  labor force improvement. 
B)  labor force growth. 
C)  capital formation. 
D)  consumption growth. 
A)  labor force improvement. 
B)  labor force growth. 
C)  capital formation. 
D)  consumption growth.

Question 3

To promote rapid economic growth, the new growth theory would argue for increased scholarships in

Accepted Answer

A)  women's studies. 
B)  deconstructionist literature. 
C)  post-modern sociology. 
D)  biology. 
A)  women's studies. 
B)  deconstructionist literature. 
C)  post-modern sociology. 
D)  biology.

Question 4

What determines the productivity growth rates of a country?

Accepted Answer

A)  Amount of working capital currently available 
B)  Rates of increase of capital, technology, and workforce quality 
C)  Current level of gross domestic product 
D)  Current levels of human capital, physical capital, and technology 
A)  Amount of working capital currently available 
B)  Rates of increase of capital, technology, and workforce quality 
C)  Current level of gross domestic product 
D)  Current levels of human capital, physical capital, and technology

Question 5

The Internet was first developed in the

Accepted Answer

A)  business sector. 
B)  government sector. 
C)  corporate sector. 
D)  college dorm room of Bill Gates. 
A)  business sector. 
B)  government sector. 
C)  corporate sector. 
D)  college dorm room of Bill Gates.

Question 6

Which of the following would be an example of capital formation?

Accepted Answer

A)  The purchase of government bonds 
B)  An initial public offering by a technology company 
C)  The acquisition of a domestic company by a foreign country 
D)  The expansion of a grocery store into a rural area 
A)  The purchase of government bonds 
B)  An initial public offering by a technology company 
C)  The acquisition of a domestic company by a foreign country 
D)  The expansion of a grocery store into a rural area

Question 7

By enjoying more consumer goods today, the economy spurs growth in future consumer goods.

Accepted Answer

A) True 
 B)False

Question 8

The production function shifts upward as the capital stock increases.

Accepted Answer

A) True 
 B)False

Question 9

Productivity growth rates in the United States have remained fairly constant from 1948 to 2000.

Accepted Answer

A) True 
 B)False

Question 10

The wage premium in the United States has risen consistently starting in

Accepted Answer

A)  1973 
B)  1975 
C)  1978 
D)  1983 
A)  1973 
B)  1975 
C)  1978 
D)  1983

Question 11

The cost of education, professional athletes' pay, and medical services rise faster than the rate of goods and services because their average productivity has remained the same.

Accepted Answer

A) True 
 B)False

Question 12

A recession will occur if an economy's actual GDP ____ its potential GDP.

Accepted Answer

A)  rises above 
B)  equals 
C)  falls below 
D)  grows faster than 
A)  rises above 
B)  equals 
C)  falls below 
D)  grows faster than

Question 13

The change in the contribution of capital formation was the chief cause of the productivity slowdown in 1973-1995.

Accepted Answer

A) True 
 B)False

Question 14

In general, as productivity levels increase, the potential for productivity growth

Accepted Answer

A)  decreases. 
B)  increases. 
C)  remains the same. 
D)  increases if GDP increases. 
A)  decreases. 
B)  increases. 
C)  remains the same. 
D)  increases if GDP increases.

Question 15

A major contributor to the slowdown in U.S. labor productivity during the 1973-1995 period was

Accepted Answer

A)  capital spending. 
B)  technological change. 
C)  labor force growth. 
D)  investment spending. 
A)  capital spending. 
B)  technological change. 
C)  labor force growth. 
D)  investment spending.

Question 16

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 17

The argument that rising energy prices caused the decline in U.S. productivity in the 1970s is made less believable due to the

Accepted Answer

A)  falling level of saving in the 1970s. 
B)  falling level of energy prices in the 1980s. 
C)  rising level of energy prices in the 1980s. 
D)  rising level of energy prices in the 1990s. 
A)  falling level of saving in the 1970s. 
B)  falling level of energy prices in the 1980s. 
C)  rising level of energy prices in the 1980s. 
D)  rising level of energy prices in the 1990s.

Question 18

The wage premium in the United States for college graduates over high school graduates has remained constant from 1978 to 2000.

Accepted Answer

A) True 
 B)False

Question 19

Real wages usually lag behind the increases in labor productivity.

Accepted Answer

A) True 
 B)False

Question 20

What is the "cost disease of personal services" phenomenon and why does it help explain why tuition rates keep going up so fast?

Accepted Answer

One of the curious developments in moder

Exam 23: Economic Growth: Theory and Policy

Which of the following countries has the lowest level of average educational attainment?

Two of the three pillars of labor productivity growth responsible for the changes in the United States after 1995 are technological change and

To promote rapid economic growth, the new growth theory would argue for increased scholarships in

What determines the productivity growth rates of a country?

The Internet was first developed in the

Which of the following would be an example of capital formation?

By enjoying more consumer goods today, the economy spurs growth in future consumer goods.

The production function shifts upward as the capital stock increases.

Productivity growth rates in the United States have remained fairly constant from 1948 to 2000.

The wage premium in the United States has risen consistently starting in

The cost of education, professional athletes' pay, and medical services rise faster than the rate of goods and services because their average productivity has remained the same.

A recession will occur if an economy's actual GDP ____ its potential GDP.

The change in the contribution of capital formation was the chief cause of the productivity slowdown in 1973-1995.

In general, as productivity levels increase, the potential for productivity growth

A major contributor to the slowdown in U.S. labor productivity during the 1973-1995 period was

The phrase "capital formation" is synonymous with

The argument that rising energy prices caused the decline in U.S. productivity in the 1970s is made less believable due to the

The wage premium in the United States for college graduates over high school graduates has remained constant from 1978 to 2000.

Real wages usually lag behind the increases in labor productivity.

What is the "cost disease of personal services" phenomenon and why does it help explain why tuition rates keep going up so fast?

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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