Question 1

According to economist Edward Denison,about one-half of the growth in the U.S.output for the period 1929 to 1969 was the result of

Accepted Answer

A)  increases in population. 
B)  increases in government spending. 
C)  surpluses in the balance of payments. 
D)  increased capital investment. 
E)  increased output per unit of input. 
A)  increases in population. 
B)  increases in government spending. 
C)  surpluses in the balance of payments. 
D)  increased capital investment. 
E)  increased output per unit of input.

Question 2

The firm or individual that first applies a new technology is called a(n)

Accepted Answer

A)  consumer. 
B)  monopolist. 
C)  Keynesian. 
D)  innovator. 
E)  financier. 
A)  consumer. 
B)  monopolist. 
C)  Keynesian. 
D)  innovator. 
E)  financier.

Question 3

Joseph Schumpeter's view of innovation and the diffusion process can be represented as

Accepted Answer

A)  a continuous movement along the average product of capital curve. 
B)  a series of outward shifts of the marginal product curves of capital and labor. 
C)  a steady increase in the stock of human capital. 
D)  an increase over time in entrepreneurial ambitions. 
E)  the independent effects of workers and technology on production. 
A)  a continuous movement along the average product of capital curve. 
B)  a series of outward shifts of the marginal product curves of capital and labor. 
C)  a steady increase in the stock of human capital. 
D)  an increase over time in entrepreneurial ambitions. 
E)  the independent effects of workers and technology on production.

Question 4

An advantage in increasing the per capita annual rate of growth,however slightly,is that it will

Accepted Answer

A)  shift the production possibilities curve inward. 
B)  lead to a more rapid increase in population. 
C)  lead to a substantially higher level of real output two or three decades later. 
D)  ensure the elimination of the business cycle. 
E)  eliminate the problem of relative scarcity. 
A)  shift the production possibilities curve inward. 
B)  lead to a more rapid increase in population. 
C)  lead to a substantially higher level of real output two or three decades later. 
D)  ensure the elimination of the business cycle. 
E)  eliminate the problem of relative scarcity.

Question 5

As compared to earlier years,the rate of growth of labor productivity in the United States during the late 1990s and early 2000s

Accepted Answer

A)  remained constant. 
B)  slowed slightly. 
C)  slowed considerably. 
D)  increased significantly. 
E)  slowed in the late 1990s but rose in the early 2000s. 
A)  remained constant. 
B)  slowed slightly. 
C)  slowed considerably. 
D)  increased significantly. 
E)  slowed in the late 1990s but rose in the early 2000s.

Question 6

The fear that continued growth at current rates will exhaust basic resources is diminished by

Accepted Answer

A)  data contained in the Club of Rome's The Limits to Growth report. 
B)  the knowledge that amounts of the most basic resources are virtually unlimited. 
C)  the fact that the price system provides incentives to conserve and develop replacements for our resources. 
D)  the law of diminishing returns. 
E)  a slowdown in technological change that reduces the demand for these resources. 
A)  data contained in the Club of Rome's The Limits to Growth report. 
B)  the knowledge that amounts of the most basic resources are virtually unlimited. 
C)  the fact that the price system provides incentives to conserve and develop replacements for our resources. 
D)  the law of diminishing returns. 
E)  a slowdown in technological change that reduces the demand for these resources.

Question 7

The following question are based on the following diagram:
  
-The shift in the marginal product of labor curve shown in the diagram might be caused by

Accepted Answer

A)  population growth. 
B)  an increase in the price of food. 
C)  a declining average product of labor. 
D)  technological change. 
E)  a decreasing total product of labor. 
A)  population growth. 
B)  an increase in the price of food. 
C)  a declining average product of labor. 
D)  technological change. 
E)  a decreasing total product of labor.

Question 8

A country's economic,social,and political climate can increase its level of potential output and rate of growth by

Accepted Answer

A)  deemphasizing the importance of material welfare in this world. 
B)  organizing a command economy with tight constraints on individual behavior. 
C)  capturing all the increased output for the ruling party's personal benefit. 
D)  encouraging competition and allowing economic and political freedom to foster the introduction of new ideas. 
E)  sponsoring feudalism. 
A)  deemphasizing the importance of material welfare in this world. 
B)  organizing a command economy with tight constraints on individual behavior. 
C)  capturing all the increased output for the ruling party's personal benefit. 
D)  encouraging competition and allowing economic and political freedom to foster the introduction of new ideas. 
E)  sponsoring feudalism.

Question 9

One of the important elements for a successful technological innovation is that it

Accepted Answer

A)  be relatively expensive to adapt to existing needs, creating monopoly profits. 
B)  reflect a comprehension of market realities and be encouraged by market forces. 
C)  is derived from technological development taking place outside the country. 
D)  lead to at least a doubling of an existing capital-output ratio. 
E)  lower output per person per hour, thus raising labor productivity. 
A)  be relatively expensive to adapt to existing needs, creating monopoly profits. 
B)  reflect a comprehension of market realities and be encouraged by market forces. 
C)  is derived from technological development taking place outside the country. 
D)  lead to at least a doubling of an existing capital-output ratio. 
E)  lower output per person per hour, thus raising labor productivity.

Question 10

Who wrote the classic work on the effect of population growth on the rate of economic growth?

Accepted Answer

A)  David Ricardo 
B)  Adam Smith 
C)  John Maynard Keynes 
D)  Thomas Malthus 
E)  Karl Marx 
A)  David Ricardo 
B)  Adam Smith 
C)  John Maynard Keynes 
D)  Thomas Malthus 
E)  Karl Marx

Question 11

According to Malthus,the human race in the long run would

Accepted Answer

A)  enjoy increasing levels of affluence. 
B)  disappear entirely. 
C)  be forced to endure subsistence levels of living. 
D)  have a standard of living above subsistence but remaining constant, neither improving nor worsening. 
E)  on average produce more goods and services, but these would become distributed more and more unevenly. 
A)  enjoy increasing levels of affluence. 
B)  disappear entirely. 
C)  be forced to endure subsistence levels of living. 
D)  have a standard of living above subsistence but remaining constant, neither improving nor worsening. 
E)  on average produce more goods and services, but these would become distributed more and more unevenly.

Question 12

The law of diminishing marginal returns does NOT apply to cases where

Accepted Answer

A)  at least one input is fixed in quantity. 
B)  there is only one variable input. 
C)  technology changes. 
D)  average product is falling. 
E)  total product is rising. 
A)  at least one input is fixed in quantity. 
B)  there is only one variable input. 
C)  technology changes. 
D)  average product is falling. 
E)  total product is rising.

Question 13

Intended investment in a given year

Accepted Answer

A)  leads to stagflation in a subsequent year. 
B)  reduces the productivity of the labor force. 
C)  raises the following year's full-employment level of GDP. 
D)  reduces the amount of investment possible in a future year. 
E)  is higher when consumption represents a higher percentage of GDP. 
A)  leads to stagflation in a subsequent year. 
B)  reduces the productivity of the labor force. 
C)  raises the following year's full-employment level of GDP. 
D)  reduces the amount of investment possible in a future year. 
E)  is higher when consumption represents a higher percentage of GDP.

Question 14

High rates of economic growth are clearly related to high rates of

Accepted Answer

A)  unemployment. 
B)  consumption. 
C)  inflation. 
D)  technological change. 
E)  taxes on profits. 
A)  unemployment. 
B)  consumption. 
C)  inflation. 
D)  technological change. 
E)  taxes on profits.

Question 15

Once an economy is at full employment,further growth can occur only by

Accepted Answer

A)  running a budget deficit. 
B)  expanding the money supply. 
C)  promoting slack in labor markets by reducing employment. 
D)  increasing the capital-output ratio above its full-employment values. 
E)  influencing factors that cause potential output to expand. 
A)  running a budget deficit. 
B)  expanding the money supply. 
C)  promoting slack in labor markets by reducing employment. 
D)  increasing the capital-output ratio above its full-employment values. 
E)  influencing factors that cause potential output to expand.

Question 16

The process by which the use of an innovation spreads from firm to firm and use to use is called the ________ process.

Accepted Answer

A)  industrial 
B)  economic 
C)  diffusion 
D)  management 
E)  utilization 
A)  industrial 
B)  economic 
C)  diffusion 
D)  management 
E)  utilization

Question 17

Between 1980 and 2000,empirical estimates of the "education premium" rose from ________ percent.

Accepted Answer

A)  3 to 5 
B)  10 to 40 
C)  20 to 40 
D)  40 to 80 
E)  80 to 100 
A)  3 to 5 
B)  10 to 40 
C)  20 to 40 
D)  40 to 80 
E)  80 to 100

Question 18

If a society attempts to increase output by increasing the amount of labor used,holding land and capital fixed,it will experience diminishing marginal

Accepted Answer

A)  cost. 
B)  utility. 
C)  propensity. 
D)  employment. 
E)  returns. 
A)  cost. 
B)  utility. 
C)  propensity. 
D)  employment. 
E)  returns.

Question 19

Both Malthus and Ricardo erred in expecting an eventual termination of economic growth by

Accepted Answer

A)  neglecting the potential for population control. 
B)  believing that the law of diminishing marginal returns applies solely to land. 
C)  assuming a constant marginal productivity of labor. 
D)  neglecting the role of the credit system. 
E)  underestimating the extent and impact of technological change. 
A)  neglecting the potential for population control. 
B)  believing that the law of diminishing marginal returns applies solely to land. 
C)  assuming a constant marginal productivity of labor. 
D)  neglecting the role of the credit system. 
E)  underestimating the extent and impact of technological change.

Question 20

During the past century,the rate of return on investment in new plant equipment in the United States has

Accepted Answer

A)  fluctuated around a fairly constant level. 
B)  steadily declined. 
C)  steadily increased. 
D)  increased as the marginal product of capital has declined. 
E)  decreased as the capital-output ratio has decreased. 
A)  fluctuated around a fairly constant level. 
B)  steadily declined. 
C)  steadily increased. 
D)  increased as the marginal product of capital has declined. 
E)  decreased as the capital-output ratio has decreased.

Exam 13: Economic Growth

According to economist Edward Denison,about one-half of the growth in the U.S.output for the period 1929 to 1969 was the result of

The firm or individual that first applies a new technology is called a(n)

Joseph Schumpeter's view of innovation and the diffusion process can be represented as

An advantage in increasing the per capita annual rate of growth,however slightly,is that it will

As compared to earlier years,the rate of growth of labor productivity in the United States during the late 1990s and early 2000s

The fear that continued growth at current rates will exhaust basic resources is diminished by

The following question are based on the following diagram: -The shift in the marginal product of labor curve shown in the diagram might be caused by

A country's economic,social,and political climate can increase its level of potential output and rate of growth by

One of the important elements for a successful technological innovation is that it

Who wrote the classic work on the effect of population growth on the rate of economic growth?

According to Malthus,the human race in the long run would

The law of diminishing marginal returns does NOT apply to cases where

Intended investment in a given year

High rates of economic growth are clearly related to high rates of

Once an economy is at full employment,further growth can occur only by

The process by which the use of an innovation spreads from firm to firm and use to use is called the ________ process.

Between 1980 and 2000,empirical estimates of the "education premium" rose from ________ percent.

If a society attempts to increase output by increasing the amount of labor used,holding land and capital fixed,it will experience diminishing marginal

Both Malthus and Ricardo erred in expecting an eventual termination of economic growth by

During the past century,the rate of return on investment in new plant equipment in the United States has

What is Economics

Markets and Prices

The Business Firm: Organization,motivation,and Optimal Input Decisions

Getting Behind the Demand and Supply Curves

Market Demand and Price Elasticity

Economic Efficiency,market Supply,and Perfect Competition

Monopoly and Its Regulation

Monopolistic Competition,oligopoly,and Antitrust Policy

Pollution and the Environment

The Supply and Demand for Labor

Interest,rent,and Profit

Poverty,income Inequality,and Discrimination

Public Goods and the Role of the Government

National Income and Product

Business Fluctuations and Unemployment

The Determination of National Output and the Keynesian Multiplier

Fiscal Policy and National Output

Inflation

Money and the Banking System

The Federal Reserve and Monetary Policy

Supply Shocks and Inflation

Productivity,growth,and Technology Policy

Surpluses,deficits,public Debt,and the Federal Budget

Monetary Policy,interest Rates,and Economic Activity

Controversies Over Stabilization Policy

International Trade

Exchange Rates and the Balance of Payments

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