Question 1

One possible way of achieving faster economic growth is to

Accepted Answer

A) regulate the amount of international trade and limit it so that not too much occurs. 
B) limit research and development because research and development does not contribute anything to today's production. 
C) assign the government ownership of all capital. 
D) protect property rights and free markets. 
E) tax saving so that people spend more and firms' profits are higher. 
A) regulate the amount of international trade and limit it so that not too much occurs. 
B) limit research and development because research and development does not contribute anything to today's production. 
C) assign the government ownership of all capital. 
D) protect property rights and free markets. 
E) tax saving so that people spend more and firms' profits are higher.

Question 2

The growth rate of real GDP equals

Accepted Answer

A) [(employment in the current year - employment in previous year)/employment in previous year] × 100. 
B) [(real GDP in current year - real GDP in previous year)÷ real GDP in previous year] × 100. 
C) [(real GDP in previous year - real GDP in current year)÷ real GDP in previous year] × 100. 
D) [(real GDP in current year - real GDP in previous year)÷ real GDP in current year] × 100. 
E) (real GDP in current year - real GDP in previous year)× 100. 
A) [(employment in the current year - employment in previous year)/employment in previous year] × 100. 
B) [(real GDP in current year - real GDP in previous year)÷ real GDP in previous year] × 100. 
C) [(real GDP in previous year - real GDP in current year)÷ real GDP in previous year] × 100. 
D) [(real GDP in current year - real GDP in previous year)÷ real GDP in current year] × 100. 
E) (real GDP in current year - real GDP in previous year)× 100.

Question 3

Last year, in a nation far to the South, real GDP was $90 million and 900,000 workers were employed. This year real GDP is $100 million, 950,000 workers are employed, and the number of hours each worker works per year did not change. Hence, labor productivity

Accepted Answer

A) has increased. 
B) has decreased. 
C) has remained constant. 
D) cannot be compared between the two years because both real GDP and the number of workers increased. 
E) might have changed, but more information is needed to determine if it changed. 
A) has increased. 
B) has decreased. 
C) has remained constant. 
D) cannot be compared between the two years because both real GDP and the number of workers increased. 
E) might have changed, but more information is needed to determine if it changed.

Question 4

This year Iceland has a real GDP per person that is approximately 8 times greater than that of Cape Verde. Cape Verde's growth rate of real GDP per person was 5.2 percent. If Cape Verde maintains this current growth rate, approximately how many years will it take for Cape Verde's real GDP per person to reach the same level that Iceland has this year?

Accepted Answer

A) 13.5 years 
B) 20 years 
C) 27 years 
D) 40 years 
E) 54 years 
A) 13.5 years 
B) 20 years 
C) 27 years 
D) 40 years 
E) 54 years

Question 5

If aggregate hours are 100 billion hours and labor productivity is $40 an hour, than real GDP equals

Accepted Answer

A) $100 billion. 
B) $40 billion. 
C) $100 trillion. 
D) $2.5 trillion. 
E) $4 trillion. 
A) $100 billion. 
B) $40 billion. 
C) $100 trillion. 
D) $2.5 trillion. 
E) $4 trillion.

Question 6

A surplus of labor is eliminated by ________ in the real wage rate and a shortage of labor is eliminated by ________ in the real wage rate.

Accepted Answer

A) an increase; an increase 
B) an increase; a decrease 
C) a decrease; an increase 
D) a decrease; a decrease 
E) None of the above answers are correct because shortages and surpluses are eliminated by changes in the demand for labor and the supply of labor, not the wage rate. 
A) an increase; an increase 
B) an increase; a decrease 
C) a decrease; an increase 
D) a decrease; a decrease 
E) None of the above answers are correct because shortages and surpluses are eliminated by changes in the demand for labor and the supply of labor, not the wage rate.

Question 7

A measure of growth in the standard of living is the growth in

Accepted Answer

A) real GDP. 
B) population. 
C) real GDP minus the growth in population. 
D) population minus the growth in real GDP. 
E) employment. 
A) real GDP. 
B) population. 
C) real GDP minus the growth in population. 
D) population minus the growth in real GDP. 
E) employment.

Question 8

Which of the following statements is true?

Accepted Answer

A) According to the labor supply curve, as the real wage rises, employers are willing to provide more jobs. 
B) According to the labor supply curve, as the real wage rises, workers are willing to provide more labor. 
C) According to the labor supply curve, as the real wage rises, employers are willing to provide fewer jobs. 
D) According to the labor supply curve, as the real wage rises, workers are willing to provide less labor. 
E) According to the labor supply curve, as the real wage rises, more workers leave the labor force. 
A) According to the labor supply curve, as the real wage rises, employers are willing to provide more jobs. 
B) According to the labor supply curve, as the real wage rises, workers are willing to provide more labor. 
C) According to the labor supply curve, as the real wage rises, employers are willing to provide fewer jobs. 
D) According to the labor supply curve, as the real wage rises, workers are willing to provide less labor. 
E) According to the labor supply curve, as the real wage rises, more workers leave the labor force.

Question 9

If a country experiences a real GDP growth rate of 1 percent and population growth of 2 percent, then the growth rate of real GDP per person is

Accepted Answer

A) 3 percent. 
B) 2 percent. 
C) 1 percent. 
D) -1 percent. 
E) 0 percent. 
A) 3 percent. 
B) 2 percent. 
C) 1 percent. 
D) -1 percent. 
E) 0 percent.

Question 10

The total labor hours that all the firms in the economy plan to hire during a given time period at one particular real wage rate is the

Accepted Answer

A) demand for labor. 
B) quantity of labor demanded. 
C) supply of labor. 
D) quantity of labor supplied. 
E) quantity of jobs supplied. 
A) demand for labor. 
B) quantity of labor demanded. 
C) supply of labor. 
D) quantity of labor supplied. 
E) quantity of jobs supplied.

Question 11

Economic growth is a sustained expansion of production possibilities, as measured by the increase in ________ over time.

Accepted Answer

A) real GDP 
B) population 
C) inflation 
D) the price level 
E) employment 
A) real GDP 
B) population 
C) inflation 
D) the price level 
E) employment

Question 12

Labor productivity is equal to the quantity of

Accepted Answer

A) real GDP produced by one hour of labor. 
B) workers employed during one hour. 
C) real GDP consumed by the total population in one hour. 
D) real GDP. 
E) workers who are gainfully employed. 
A) real GDP produced by one hour of labor. 
B) workers employed during one hour. 
C) real GDP consumed by the total population in one hour. 
D) real GDP. 
E) workers who are gainfully employed.

Question 13

The level of real GDP that the economy produces at full employment is called

Accepted Answer

A) real GDP. 
B) nominal GDP. 
C) potential GDP. 
D) sustainable GDP. 
E) total GDP. 
A) real GDP. 
B) nominal GDP. 
C) potential GDP. 
D) sustainable GDP. 
E) total GDP.

Question 14

-The figure above shows the U.S. supply of labor curve. What was the affect of the decline in birth rates during the 1960s and 1970s on the supply of labor curve in the 1980s?

Accepted Answer

A) a rightward shift of the supply of labor curve 
B) the supply of labor curve became steeper 
C) a movement downward along the supply of labor curve from a point such as A to a point such as B 
D) a leftward shift of the supply of labor curve 
E) None of the above answers is correct because there was no change in the supply of labor curve. 
A) a rightward shift of the supply of labor curve 
B) the supply of labor curve became steeper 
C) a movement downward along the supply of labor curve from a point such as A to a point such as B 
D) a leftward shift of the supply of labor curve 
E) None of the above answers is correct because there was no change in the supply of labor curve.

Question 15

Potential GDP

Accepted Answer

A) is the quantity of GDP produced when the economy is at full employment of all resources. 
B) can never be exceeded. 
C) can never be attained. 
D) is another name for real GDP. 
E) is another name for nominal GDP. 
A) is the quantity of GDP produced when the economy is at full employment of all resources. 
B) can never be exceeded. 
C) can never be attained. 
D) is another name for real GDP. 
E) is another name for nominal GDP.

Question 16

If the government raises income taxes, then the labor

Accepted Answer

A) demand curve shifts rightward. 
B) demand curve shifts leftward. 
C) supply curve shifts rightward. 
D) supply curve shifts leftward. 
E) Both answers B and D are correct. 
A) demand curve shifts rightward. 
B) demand curve shifts leftward. 
C) supply curve shifts rightward. 
D) supply curve shifts leftward. 
E) Both answers B and D are correct.

Question 17

Suppose France's real GDP grew from $750 billion in 2008 to $821 billion in 2009. What was the growth rate of France's real GDP?

Accepted Answer

A) 10 percent 
B) 9.5 percent 
C) 9.1 percent 
D) 8.6 percent 
E) $71 billion 
A) 10 percent 
B) 9.5 percent 
C) 9.1 percent 
D) 8.6 percent 
E) $71 billion

Question 18

A diagram of a productivity curve has

Accepted Answer

A) real GDP per hour of labor on the y-axis and capital per hour of labor on the x-axis. 
B) real GDP per hour of labor on the y-axis and hours of labor on the x-axis. 
C) capital per hour of labor on the y-axis and real GDP per hour of labor on the x-axis. 
D) real wages per hour on the y-axis and real GDP per hour of labor on the x-axis. 
E) real GDP per hour of labor on the y-axis and real wages per hour on the x-axis. 
A) real GDP per hour of labor on the y-axis and capital per hour of labor on the x-axis. 
B) real GDP per hour of labor on the y-axis and hours of labor on the x-axis. 
C) capital per hour of labor on the y-axis and real GDP per hour of labor on the x-axis. 
D) real wages per hour on the y-axis and real GDP per hour of labor on the x-axis. 
E) real GDP per hour of labor on the y-axis and real wages per hour on the x-axis.

Question 19

Labor force productivity has increased from $30 per hour to $32 per hour over the past year. This could result from

Accepted Answer

A) only an increase in real GDP. 
B) an increase in real GDP with no change in the aggregate hours or an decrease in aggregate hours with no change in real GDP. 
C) only a decrease in aggregate hours. 
D) an increase in the labor force participation rate. 
E) an increase in population. 
A) only an increase in real GDP. 
B) an increase in real GDP with no change in the aggregate hours or an decrease in aggregate hours with no change in real GDP. 
C) only a decrease in aggregate hours. 
D) an increase in the labor force participation rate. 
E) an increase in population.

Question 20

The fastest growing nations today are those with

Accepted Answer

A) barriers that significantly limit international trade. 
B) the fastest growing exports and imports. 
C) government intervention in markets to ensure high prices. 
D) few funds spent on research and development. 
E) the least saving. 
A) barriers that significantly limit international trade. 
B) the fastest growing exports and imports. 
C) government intervention in markets to ensure high prices. 
D) few funds spent on research and development. 
E) the least saving.

One possible way of achieving faster economic growth is to

The growth rate of real GDP equals

Last year, in a nation far to the South, real GDP was $90 million and 900,000 workers were employed. This year real GDP is $100 million, 950,000 workers are employed, and the number of hours each worker works per year did not change. Hence, labor productivity

If aggregate hours are 100 billion hours and labor productivity is $40 an hour, than real GDP equals

A surplus of labor is eliminated by in the real wage rate and a shortage of labor is eliminated by in the real wage rate.

A measure of growth in the standard of living is the growth in

Which of the following statements is true?

If a country experiences a real GDP growth rate of 1 percent and population growth of 2 percent, then the growth rate of real GDP per person is

The total labor hours that all the firms in the economy plan to hire during a given time period at one particular real wage rate is the

Economic growth is a sustained expansion of production possibilities, as measured by the increase in ________ over time.

Labor productivity is equal to the quantity of

The level of real GDP that the economy produces at full employment is called

-The figure above shows the U.S. supply of labor curve. What was the affect of the decline in birth rates during the 1960s and 1970s on the supply of labor curve in the 1980s?

Potential GDP

If the government raises income taxes, then the labor

Suppose France's real GDP grew from $750 billion in 2008 to $821 billion in 2009. What was the growth rate of France's real GDP?

A diagram of a productivity curve has

Labor force productivity has increased from $30 per hour to $32 per hour over the past year. This could result from

The fastest growing nations today are those with

Getting Started

The Us and Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Global Markets in Action

Externalities: Pollution, Education, and Health Care

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Gdp: a Measure of Total Production and Income

Jobs and Unemployment

The Cpi and the Cost of Living

Money and the Monetary System

Aggregate Supply and Aggregate Demand

Fiscal Policy and Monetary Policy

Filters

Exam 17: Potential Gdp and Economic Growth

One possible way of achieving faster economic growth is to

The growth rate of real GDP equals

Last year, in a nation far to the South, real GDP was $90 million and 900,000 workers were employed. This year real GDP is $100 million, 950,000 workers are employed, and the number of hours each worker works per year did not change. Hence, labor productivity

If aggregate hours are 100 billion hours and labor productivity is $40 an hour, than real GDP equals

A surplus of labor is eliminated by ________ in the real wage rate and a shortage of labor is eliminated by ________ in the real wage rate.

A measure of growth in the standard of living is the growth in

Which of the following statements is true?

If a country experiences a real GDP growth rate of 1 percent and population growth of 2 percent, then the growth rate of real GDP per person is

The total labor hours that all the firms in the economy plan to hire during a given time period at one particular real wage rate is the

Economic growth is a sustained expansion of production possibilities, as measured by the increase in ________ over time.

Labor productivity is equal to the quantity of

The level of real GDP that the economy produces at full employment is called

-The figure above shows the U.S. supply of labor curve. What was the affect of the decline in birth rates during the 1960s and 1970s on the supply of labor curve in the 1980s?

Potential GDP

If the government raises income taxes, then the labor

Suppose France's real GDP grew from $750 billion in 2008 to $821 billion in 2009. What was the growth rate of France's real GDP?

A diagram of a productivity curve has

Labor force productivity has increased from $30 per hour to $32 per hour over the past year. This could result from

The fastest growing nations today are those with

Getting Started

The Us and Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Global Markets in Action

Externalities: Pollution, Education, and Health Care

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Gdp: a Measure of Total Production and Income

Jobs and Unemployment

The Cpi and the Cost of Living

Money and the Monetary System

Aggregate Supply and Aggregate Demand

Fiscal Policy and Monetary Policy

Filters

A surplus of labor is eliminated by in the real wage rate and a shortage of labor is eliminated by in the real wage rate.