Question 1

Real GDP equals $12 trillion and aggregate hours equals 300 billion hours.What does labor productivity equal?

Accepted Answer

Labor productivity is (real GD

Question 2

Savings is an important factor influencing economic growth because saving

Accepted Answer

A)  can finance new investment and capital formation. 
B)  helps the economy maintain the current level of total expenditures when a recession begins. 
C)  provides a fund for wages needed from any unexpected population growth. 
D)  All of the above answers are correct. 
A)  can finance new investment and capital formation. 
B)  helps the economy maintain the current level of total expenditures when a recession begins. 
C)  provides a fund for wages needed from any unexpected population growth. 
D)  All of the above answers are correct.

Question 3

Which of the following ideas are included in classical growth theory?
I. Subsistence real GDP per person
II. Growth in real GDP per person is temporary.
III. Technological change induces investment.

Accepted Answer

A)  I only 
B)  I and II 
C)  II and III 
D)  I, II and III 
A)  I only 
B)  I and II 
C)  II and III 
D)  I, II and III

Question 4

If the price level increases,but workers' money wage rates remain constant,which of the following is TRUE?
I. The quantity of labor demanded will increase.
II. The real wage rate will decrease.
III. The demand for labor curve shifts rightward.

Accepted Answer

A)  I only 
B)  I and II 
C)  II and III 
D)  I, II and III 
A)  I only 
B)  I and II 
C)  II and III 
D)  I, II and III

Question 5

-The figure above shows the U.S.production function.From 1986 to 2008 the United States experienced major advances in technology as well as an increase in the working-age population.The combined effect can best be shown by a

Accepted Answer

A)  movement from point W to point X. 
B)  movement from point Y to point Z. 
C)  movement from point Y to point X. 
D)  movement from point W to point Z. 
A)  movement from point W to point X. 
B)  movement from point Y to point Z. 
C)  movement from point Y to point X. 
D)  movement from point W to point Z.

Question 6

Describe ways that governments can promote faster economic growth.

Accepted Answer

Policies for increasing the economic gro

Question 7

An increase in education and training

Accepted Answer

A)  increases labor productivity. 
B)  increases aggregate hours. 
C)  decreases real GDP growth. 
D)  increases the employment-to-population ratio. 
A)  increases labor productivity. 
B)  increases aggregate hours. 
C)  decreases real GDP growth. 
D)  increases the employment-to-population ratio.

Question 8

An advance in technology shifts the production function upward and shifts the labor

Accepted Answer

A)  demand curve leftward. 
B)  supply curve leftward. 
C)  demand curve rightward. 
D)  supply curve rightward. 
A)  demand curve leftward. 
B)  supply curve leftward. 
C)  demand curve rightward. 
D)  supply curve rightward.

Question 9

During the 1990s,which of the following experienced the slowest rate of growth in real GDP per person?

Accepted Answer

A)  Japan 
B)  The big 4 nations of Europe 
C)  United States 
D)  Canada 
A)  Japan 
B)  The big 4 nations of Europe 
C)  United States 
D)  Canada

Question 10

The curvature of the production function shows that as employment increases,the productivity of labor

Accepted Answer

A)  remains positive and increases. 
B)  remains positive but decreases. 
C)  decreases and becomes negative. 
D)  remains constant. 
A)  remains positive and increases. 
B)  remains positive but decreases. 
C)  decreases and becomes negative. 
D)  remains constant.

Question 11

Several factors are important for achieving faster economic growth.Which of the following is one of those factors?

Accepted Answer

A)  expansion of international trade 
B)  increased government expenditure 
C)  increased taxes on saving 
D)  promotion of consumption expenditure 
A)  expansion of international trade 
B)  increased government expenditure 
C)  increased taxes on saving 
D)  promotion of consumption expenditure

Question 12

According to neoclassical growth theory,the higher real GDP per person from economic growth will

Accepted Answer

A)  not last because the population will increase. 
B)  last because there is no link between growth and population. 
C)  last indefinitely regardless of any other factor. 
D)  last as long as technological change continues. 
A)  not last because the population will increase. 
B)  last because there is no link between growth and population. 
C)  last indefinitely regardless of any other factor. 
D)  last as long as technological change continues.

Question 13

How does the new growth theory explain economic growth?

Accepted Answer

The new growth theory explains growth as

Question 14

If the labor market is in equilibrium and then the labor supply curve shifts rightward,

Accepted Answer

A)  there will be a shortage of labor at the original equilibrium wage rate. 
B)  there will be a surplus of labor at the original equilibrium wage rate. 
C)  the equilibrium wage rate will rise. 
D)  there will be a surplus of jobs at the new equilibrium. 
A)  there will be a shortage of labor at the original equilibrium wage rate. 
B)  there will be a surplus of labor at the original equilibrium wage rate. 
C)  the equilibrium wage rate will rise. 
D)  there will be a surplus of jobs at the new equilibrium.

Question 15

Slowdonia's current growth rate of real GDP per person is 1 percent a year. Approximately how long will it take to double real GDP per person?

Accepted Answer

A)  10 years 
B)  35 years 
C)  70 years 
D)  100 years 
A)  10 years 
B)  35 years 
C)  70 years 
D)  100 years

Question 16

Suppose the money wage rate and the price level both fall by 5 percent.As a result,

Accepted Answer

A)  the quantity of labor demanded increases. 
B)  the quantity of labor demanded decreases. 
C)  the quantity of labor demanded does not change because there is no change in the real wage. 
D)  people are worse off and there is more unemployment. 
A)  the quantity of labor demanded increases. 
B)  the quantity of labor demanded decreases. 
C)  the quantity of labor demanded does not change because there is no change in the real wage. 
D)  people are worse off and there is more unemployment.

Question 17

$$\begin{array} { | c | c | c | } 
\hline \begin{array} { c } 
\text { Real wage rate } \
\text { (2005 dollars } \
\text { per hour) }
\end{array} & \begin{array} { c } 
\text { Quantity of labor } \
\text { demanded } \
\text { (billions of hours } \
\text { per year) }
\end{array} & \begin{array} { c } 
\text { Quantity of labor } \
\text { supplied (billions } \
\text { of hours per year) }
\end{array} \
\hline 15 & 70 & 10 \
\hline 20 & 60 & 20 \
\hline 25 & 50 & 30 \
\hline 30 & 40 & 40 \
\hline 35 & 30 & 50 \
\hline
\end{array}$$
-The table above shows the labor market for the country of Pickett.When the labor market is in equilibrium,the real wage rate is ________ and ________ of labor a year are employed.

Accepted Answer

A)  any value less than $25 an hour; any value greater than 40 billion hours 
B)  any value greater than $30 an hour; any value more than 40 billion hours 
C)  any value greater than or equal to $25 an hour; any value less than 40 billion hours 
D)  $30 an hour; 40 billion hours 
A)  any value less than $25 an hour; any value greater than 40 billion hours 
B)  any value greater than $30 an hour; any value more than 40 billion hours 
C)  any value greater than or equal to $25 an hour; any value less than 40 billion hours 
D)  $30 an hour; 40 billion hours

Question 18

The demand for labor curve is

Accepted Answer

A)  upward sloping at potential GDP and downward sloping elsewhere. 
B)  vertical at potential GDP. 
C)  downward sloping. 
D)  upward sloping because firms demand labor. 
A)  upward sloping at potential GDP and downward sloping elsewhere. 
B)  vertical at potential GDP. 
C)  downward sloping. 
D)  upward sloping because firms demand labor.

Question 19

$$\begin{array} { | c | c | c | } 
\hline \begin{array} { c } 
\text { Real wage rate } \
\text { (2005 dollars } \
\text { per hour) }
\end{array} & \begin{array} { c } 
\text { Quantity of labor } \
\text { demanded } \
\text { (billions of hours } \
\text { per year) }
\end{array} & \begin{array} { c } 
\text { Quantity of labor } \
\text { supplied (billions } \
\text { of hours per year) }
\end{array} \
\hline 15 & 70 & 10 \
\hline 20 & 60 & 20 \
\hline 25 & 50 & 30 \
\hline 30 & 40 & 40 \
\hline 35 & 30 & 50 \
\hline
\end{array}$$ 
 $$\begin{array} { | c | c | } 
\hline \begin{array} { c } 
\text { Real GDP } \
\text { (trillions of 2005 } \
\text { dollars per year) }
\end{array} & \begin{array} { c } 
\text { Quantity of labor } \
\text { (billions of hours } \
\text { per year) }
\end{array} \
\hline 3 & 20 \
\hline 9 & 30 \
\hline 14 & 40 \
\hline 18 & 50 \
\hline 21 & 60 \
\hline
\end{array}$$
-The tables above show the labor market and the production function schedule for the country of Pickett.Potential GDP is ________.

Accepted Answer

A)  $40 trillion 
B)  $9 trillion 
C)  $14 trillion 
D)  $25 trillion 
A)  $40 trillion 
B)  $9 trillion 
C)  $14 trillion 
D)  $25 trillion

Question 20

Over the last 100 years,the average U.S.growth rate in real GDP per person was about

Accepted Answer

A)  2 percent per year. 
B)  6 percent per year. 
C)  12.5 percent per year. 
D)  1 percent per year. 
A)  2 percent per year. 
B)  6 percent per year. 
C)  12.5 percent per year. 
D)  1 percent per year.

Real GDP equals $12 trillion and aggregate hours equals 300 billion hours.What does labor productivity equal?

Savings is an important factor influencing economic growth because saving

Which of the following ideas are included in classical growth theory? I. Subsistence real GDP per person II. Growth in real GDP per person is temporary. III. Technological change induces investment.

If the price level increases,but workers' money wage rates remain constant,which of the following is TRUE? I. The quantity of labor demanded will increase. II. The real wage rate will decrease. III. The demand for labor curve shifts rightward.

-The figure above shows the U.S.production function.From 1986 to 2008 the United States experienced major advances in technology as well as an increase in the working-age population.The combined effect can best be shown by a

Describe ways that governments can promote faster economic growth.

An increase in education and training

An advance in technology shifts the production function upward and shifts the labor

During the 1990s,which of the following experienced the slowest rate of growth in real GDP per person?

The curvature of the production function shows that as employment increases,the productivity of labor

Several factors are important for achieving faster economic growth.Which of the following is one of those factors?

According to neoclassical growth theory,the higher real GDP per person from economic growth will

How does the new growth theory explain economic growth?

If the labor market is in equilibrium and then the labor supply curve shifts rightward,

Slowdonia's current growth rate of real GDP per person is 1 percent a year. Approximately how long will it take to double real GDP per person?

Suppose the money wage rate and the price level both fall by 5 percent.As a result,

The demand for labor curve is

Over the last 100 years,the average U.S.growth rate in real GDP per person was about

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

Real GDP equals $12 trillion and aggregate hours equals 300 billion hours.What does labor productivity equal?

Savings is an important factor influencing economic growth because saving

Which of the following ideas are included in classical growth theory? I. Subsistence real GDP per person II. Growth in real GDP per person is temporary. III. Technological change induces investment.

If the price level increases,but workers' money wage rates remain constant,which of the following is TRUE? I. The quantity of labor demanded will increase. II. The real wage rate will decrease. III. The demand for labor curve shifts rightward.

-The figure above shows the U.S.production function.From 1986 to 2008 the United States experienced major advances in technology as well as an increase in the working-age population.The combined effect can best be shown by a

Describe ways that governments can promote faster economic growth.

An increase in education and training

An advance in technology shifts the production function upward and shifts the labor

During the 1990s,which of the following experienced the slowest rate of growth in real GDP per person?

The curvature of the production function shows that as employment increases,the productivity of labor

Several factors are important for achieving faster economic growth.Which of the following is one of those factors?

According to neoclassical growth theory,the higher real GDP per person from economic growth will

How does the new growth theory explain economic growth?

If the labor market is in equilibrium and then the labor supply curve shifts rightward,

Slowdonia's current growth rate of real GDP per person is 1 percent a year. Approximately how long will it take to double real GDP per person?

Suppose the money wage rate and the price level both fall by 5 percent.As a result,

The demand for labor curve is

Over the last 100 years,the average U.S.growth rate in real GDP per person was about

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