Question 1

-In the above figure,the equilibrium real wage rate is

Accepted Answer

A)  $10 per hour. 
B)  $15 per hour. 
C)  $20 per hour. 
D)  none of the above 
A)  $10 per hour. 
B)  $15 per hour. 
C)  $20 per hour. 
D)  none of the above

Question 2

New growth theory proposes that real GDP per person grows because of ________ and that growth ________.

Accepted Answer

A)  the pursuit of profit; can persist indefinitely 
B)  productivity shocks; can persist indefinitely 
C)  technological change; can only increase above the subsistence level temporarily 
D)  productivity shocks; occurs randomly 
A)  the pursuit of profit; can persist indefinitely 
B)  productivity shocks; can persist indefinitely 
C)  technological change; can only increase above the subsistence level temporarily 
D)  productivity shocks; occurs randomly

Question 3

Convergence of the income gap has been most dramatic between

Accepted Answer

A)  Hong Kong and the United States. 
B)  the Central European countries and the United States. 
C)  Africa and the United States. 
D)  South America and the United States. 
A)  Hong Kong and the United States. 
B)  the Central European countries and the United States. 
C)  Africa and the United States. 
D)  South America and the United States.

Question 4

New growth theory predicts that

Accepted Answer

A)  economic growth is only temporary. 
B)  economic growth can last indefinitely. 
C)  economic growth is eroded by changes in taxes. 
D)  government policies can do nothing to foster increased growth. 
A)  economic growth is only temporary. 
B)  economic growth can last indefinitely. 
C)  economic growth is eroded by changes in taxes. 
D)  government policies can do nothing to foster increased growth.

Question 5

The assumption that population growth will lead to a fall in real GDP per person rate back to subsistence level is

Accepted Answer

A)  accepted by all economists today. 
B)  associated with Malthusians. 
C)  part of the neoclassical school of growth theory. 
D)  central to the new growth theory. 
A)  accepted by all economists today. 
B)  associated with Malthusians. 
C)  part of the neoclassical school of growth theory. 
D)  central to the new growth theory.

Question 6

The table below shows data for China. $$\begin{array} { | c | c | c | c | } 
\hline & \text { Population } & \begin{array} { l } 
\text { Real GDP } \
\text { (yuan, } \
\text { (millions) }
\end{array} & \begin{array} { l } 
\text { Nominal GDP } \
\text { (yuan, } \
\text { billions) }
\end{array} \
\hline 2000 & 1267 & 4999 & 9921 \
\hline 2003 & 1292 & 6498 & 13582 \
\hline 2006 & 1315 & 8776 & 21087 \
\hline
\end{array}$$
The standard of living between 2003 and 2006 increased by ________.

Accepted Answer

A)  55.3 percent 
B)  1.8 percent 
C)  35 percent 
D)  32.7 percent 
A)  55.3 percent 
B)  1.8 percent 
C)  35 percent 
D)  32.7 percent

Question 7

If the real wage rate is such that the quantity of labor supplied is greater than the quantity of labor demanded,

Accepted Answer

A)  the economy is at full employment. 
B)  actual real GDP will not equal potential GDP. 
C)  job search decreases. 
D)  labor resources are allocated efficiently. 
A)  the economy is at full employment. 
B)  actual real GDP will not equal potential GDP. 
C)  job search decreases. 
D)  labor resources are allocated efficiently.

Question 8

In 2011,Armenia had a real GDP of approximately $4.21 billion and a population of 2.98 million. In 2012,real GDP was $4.59 billion and population was 2.97 million.From 2011 to 2012,Armenia's standard of living ________.

Accepted Answer

A)  increased 
B)  decreased 
C)  did not change 
D)  might have increased, decreased, or remained unchanged but more information is needed to determine which. 
A)  increased 
B)  decreased 
C)  did not change 
D)  might have increased, decreased, or remained unchanged but more information is needed to determine which.

Question 9

In 2010,of the following which nations had the highest level of real GDP per person?

Accepted Answer

A)  Japan 
B)  Europe Big 4 
C)  Canada 
D)  China 
A)  Japan 
B)  Europe Big 4 
C)  Canada 
D)  China

Question 10

-In the above figure,at the real wage rate of $50

Accepted Answer

A)  there is a surplus of 100 billion hours per year. 
B)  there is a shortage of 100 billion hours per year. 
C)  there is a surplus of 60 billion hours per year. 
D)  there is shortage of 20 billion hours per year. 
A)  there is a surplus of 100 billion hours per year. 
B)  there is a shortage of 100 billion hours per year. 
C)  there is a surplus of 60 billion hours per year. 
D)  there is shortage of 20 billion hours per year.

Question 11

An increase in a nation's population results in

Accepted Answer

A)  an upward shift in the production function. 
B)  a movement along the production function. 
C)  a leftward shift in the labor supply curve. 
D)  Both answers A and C are correct. 
A)  an upward shift in the production function. 
B)  a movement along the production function. 
C)  a leftward shift in the labor supply curve. 
D)  Both answers A and C are correct.

Question 12

According to the Economic Times (09/2012),Standard & Poor's forecast for India's GDP growth rate was cut by 1 percentage point to 5.5 percent as the entire Asia Pacific region feels the pressure of ongoing economic uncertainty. India has averaged 7 percent growth in GDP since 1997. Based on this story,it is most likely that the slowdown reflects a

Accepted Answer

A)  temporary business cycle slowdown. 
B)  temporary business cycle expansion. 
C)  change to India's long-term economic growth rate. 
D)  shrinkage of India's economy. 
A)  temporary business cycle slowdown. 
B)  temporary business cycle expansion. 
C)  change to India's long-term economic growth rate. 
D)  shrinkage of India's economy.

Question 13

If the population increases,then potential GDP ________ and employment ________.

Accepted Answer

A)  increases; increases 
B)  increases; decreases 
C)  decreases; increases 
D)  decreases; decreases 
A)  increases; increases 
B)  increases; decreases 
C)  decreases; increases 
D)  decreases; decreases

Question 14

If the quantity of capital per worker in the economy increases,

Accepted Answer

A)  the amount of money held by workers increases. 
B)  labor productivity increases. 
C)  the stock of human capital necessarily increases. 
D)  the stock of financial assets held by the public increases. 
A)  the amount of money held by workers increases. 
B)  labor productivity increases. 
C)  the stock of human capital necessarily increases. 
D)  the stock of financial assets held by the public increases.

Question 15

The aggregate production function shows that an economy increases its real GDP in the short run by

Accepted Answer

A)  developing new technologies. 
B)  increasing its physical capital stock. 
C)  using more labor. 
D)  exploring for new deposits of natural resources. 
A)  developing new technologies. 
B)  increasing its physical capital stock. 
C)  using more labor. 
D)  exploring for new deposits of natural resources.

Question 16

Which of the following statements are TRUE regarding the demand for labor?
I. The quantity of labor demanded depends on the real wage rate.
II. If the money wage rate increases and the price level remains the same,the quantity of labor demanded decreases.

Accepted Answer

A)  I only 
B)  II only 
C)  I and II 
D)  neither I nor II 
A)  I only 
B)  II only 
C)  I and II 
D)  neither I nor II

Question 17

Labor productivity,real GDP per labor hour,increases if

Accepted Answer

A)  saving and investment cause an increase in the quantity of capital per worker. 
B)  there is an increase in the accumulation of human capital. 
C)  new technologies are continuously discovered. 
D)  All of the above answers are correct. 
A)  saving and investment cause an increase in the quantity of capital per worker. 
B)  there is an increase in the accumulation of human capital. 
C)  new technologies are continuously discovered. 
D)  All of the above answers are correct.

Question 18

The Rule of 70 is used to

Accepted Answer

A)  estimate how much of an economy's growth rate is due to increases in capital per hour of labor 
B)  calculate the standard of living 
C)  calculate the economy's growth rate 
D)  estimate how long it will take the level of any variable to double 
A)  estimate how much of an economy's growth rate is due to increases in capital per hour of labor 
B)  calculate the standard of living 
C)  calculate the economy's growth rate 
D)  estimate how long it will take the level of any variable to double

Question 19

According to the Economic Times (09/2012),Standard & Poor's forecast for India's GDP growth rate was cut by 1 percentage point to 5.5 percent as the entire Asia Pacific region feels the pressure of ongoing economic uncertainty. India has averaged 7 percent growth in GDP since 1997. Which of the following is true?

Accepted Answer

A)  India's PPF has been shifting rightward since 1997. 
B)  India's PPF has been shifting leftward since 1997. 
C)  India has been moving from a point within its PPF to points beyond its PPF. 
D)  India's PPF has not shifted since 1997. 
A)  India's PPF has been shifting rightward since 1997. 
B)  India's PPF has been shifting leftward since 1997. 
C)  India has been moving from a point within its PPF to points beyond its PPF. 
D)  India's PPF has not shifted since 1997.

Question 20

If both the supply of labor and the demand for labor increase,then

Accepted Answer

A)  potential GDP decreases. 
B)  potential GDP increases. 
C)  full employment decreases. 
D)  the impact on potential GDP is uncertain 
A)  potential GDP decreases. 
B)  potential GDP increases. 
C)  full employment decreases. 
D)  the impact on potential GDP is uncertain

-In the above figure,the equilibrium real wage rate is

New growth theory proposes that real GDP per person grows because of and that growth .

Convergence of the income gap has been most dramatic between

New growth theory predicts that

The assumption that population growth will lead to a fall in real GDP per person rate back to subsistence level is

The table below shows data for China. Population Real GDP (yuan, (millions) Nominal GDP (yuan, billions) 2000 1267 4999 9921 2003 1292 6498 13582 2006 1315 8776 21087 The standard of living between 2003 and 2006 increased by ________.

If the real wage rate is such that the quantity of labor supplied is greater than the quantity of labor demanded,

In 2011,Armenia had a real GDP of approximately $4.21 billion and a population of 2.98 million. In 2012,real GDP was $4.59 billion and population was 2.97 million.From 2011 to 2012,Armenia's standard of living ________.

In 2010,of the following which nations had the highest level of real GDP per person?

-In the above figure,at the real wage rate of $50

An increase in a nation's population results in

If the population increases,then potential GDP and employment .

If the quantity of capital per worker in the economy increases,

The aggregate production function shows that an economy increases its real GDP in the short run by

Which of the following statements are TRUE regarding the demand for labor? I. The quantity of labor demanded depends on the real wage rate. II. If the money wage rate increases and the price level remains the same,the quantity of labor demanded decreases.

Labor productivity,real GDP per labor hour,increases if

The Rule of 70 is used to

If both the supply of labor and the demand for labor increase,then

What Is Economics

The Economic Problem

Demand and Supply

Measuring GDP and Economic Growth

Monitoring Jobs and Inflation

Finance, Saving, and Investment

Money, The Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers

Inflation, Jobs, and the Business Cycle

Fiscal Policy

Monetary Policy

International Trade Policy

Introduction

Monitoring Macroeconomic Performance

Macroeconomic Trends

Macroeconomic Fluctuations

Macroeconomic Policy

Filters

Exam 6: Economic Growth

-In the above figure,the equilibrium real wage rate is

New growth theory proposes that real GDP per person grows because of ________ and that growth ________.

Convergence of the income gap has been most dramatic between

New growth theory predicts that

The assumption that population growth will lead to a fall in real GDP per person rate back to subsistence level is

The table below shows data for China. Population Real GDP (yuan, (millions) Nominal GDP (yuan, billions) 2000 1267 4999 9921 2003 1292 6498 13582 2006 1315 8776 21087 The standard of living between 2003 and 2006 increased by ________.

If the real wage rate is such that the quantity of labor supplied is greater than the quantity of labor demanded,

In 2011,Armenia had a real GDP of approximately $4.21 billion and a population of 2.98 million. In 2012,real GDP was $4.59 billion and population was 2.97 million.From 2011 to 2012,Armenia's standard of living ________.

In 2010,of the following which nations had the highest level of real GDP per person?

-In the above figure,at the real wage rate of $50

An increase in a nation's population results in

If the population increases,then potential GDP ________ and employment ________.

If the quantity of capital per worker in the economy increases,

The aggregate production function shows that an economy increases its real GDP in the short run by

Which of the following statements are TRUE regarding the demand for labor? I. The quantity of labor demanded depends on the real wage rate. II. If the money wage rate increases and the price level remains the same,the quantity of labor demanded decreases.

Labor productivity,real GDP per labor hour,increases if

The Rule of 70 is used to

If both the supply of labor and the demand for labor increase,then

What Is Economics

The Economic Problem

Demand and Supply

Measuring GDP and Economic Growth

Monitoring Jobs and Inflation

Finance, Saving, and Investment

Money, The Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers

Inflation, Jobs, and the Business Cycle

Fiscal Policy

Monetary Policy

International Trade Policy

Introduction

Monitoring Macroeconomic Performance

Macroeconomic Trends

Macroeconomic Fluctuations

Macroeconomic Policy

Filters

New growth theory proposes that real GDP per person grows because of and that growth .

If the population increases,then potential GDP and employment .