Exam 11: Long-Run Economic Growth: Sources and Policies

The purchase of stocks and bonds issued in another country is known as foreign direct investment.

Of all industrialized nations,real GDP per capita was the highest in Japan in 2010.

Knowledge capital is ________ in production and ________.As a result,firms ________ free ride.

A small economy increased its capital per hour worked (K/L)from $40,000 to $50,000.As a result,real GDP per worker (Y/L)grew from $20,000 to $25,000.If the economy increases its capital per hour worked by another $10,000 to $60,000,but there is no change in technology,by how much more and in what direction will output per worker change?

Lack of investment in strong education and health care systems

An increase in ________ shifts the production function ________,and makes it possible to produce a higher level of GDP with ________ capital per hour worked.

According to the text,there are three ways the government can help increase the accumulation of knowledge capital.What are they?

If,after an outflow of workers in a country,it now takes more capital per hour worked to get the same amount of GDP per hour worked,this indicates ________ the per-worker production function in that country.

According to Joseph Schumpeter,which of the factors of production is central to economic growth?

The United States

________ save a ________ of their income.This ________ capital in their economy and raises economic growth.

Robert Lucas,a Nobel laureate in economics,argues that there are increasing returns to

GDP in a country grew from $10 billion to $14 billion over the span of 5 years.The percentage change in GDP was

List four types of government policies which can aid economic growth.

Table 22-2 -Refer to Table 22-2.Calculate the GDP per capita for each country in the table.Which country has the highest standard of living? Why?

In a small Asian country,it is estimated that changing the level of capital from $8 million to $12 million will increase real GDP from $4 million to $6 million. What level of GDP would you expect the economy to be able to reach if spending on capital continued to rise to $16 million,assuming no technological change and no change in the hours of work?

Which of the following countries had the highest GDP per capita in 2010?

The key factors in raising standards of living in low-income countries have been increases in

You have been hired as an economic advisor for a developing country.You have been asked to focus on education as a means for the country's development.Explain to the prime minister how improving education and training can contribute to his country's economic growth,and why it is important for the government to take a pro-active role in promoting education.

The per-worker production function shows the relationship between ________ per hour worked and ________ per hour worked,holding ________ constant.