Question 1

In 8 hours,Sonja produces 8 units of goods and services.In 10 hours,Emma produces 9 units of goods and services.It follows that

Accepted Answer

A)  Sonja's productivity is higher than Emma's. 
B)  Emma's productivity is higher than Sonja's. 
C)  Emma's income per hour will be higher than Sonja's. 
D)  Sonja's income per day will be higher than Emma's. 
A)  Sonja's productivity is higher than Emma's. 
B)  Emma's productivity is higher than Sonja's. 
C)  Emma's income per hour will be higher than Sonja's. 
D)  Sonja's income per day will be higher than Emma's.

Question 2

Which of the following items plays a role in determining productivity?

Accepted Answer

A)  physical capital 
B)  natural resources 
C)  technological knowledge 
D)  All of the above are correct. 
A)  physical capital 
B)  natural resources 
C)  technological knowledge 
D)  All of the above are correct.

Question 3

In the United States,as measured by real GDP per person,average income is about how many times as high as average income a century ago?

Accepted Answer

A)  2 
B)  4 
C)  6 
D)  8 
A)  2 
B)  4 
C)  6 
D)  8

Question 4

A barber shop produces 96 haircuts a day.Each barber in the shop works 8 hours per day and produces the same number of haircuts per hour.If the shop's productivity is 3 haircuts per hour of labor,then how many barbers does the shop employ?

Accepted Answer

A)  2 
B)  3 
C)  4 
D)  6 
A)  2 
B)  3 
C)  4 
D)  6

Question 5

In a particular production process,if the quantities of all inputs used are increased by 60 percent,then the quantity of output increases by 60 percent as well.This means that

Accepted Answer

A)  the production process cannot be enhanced by technological advances. 
B)  no mathematical representation of the relevant production function can be formulated. 
C)  the relevant production function has the limits-to-growth property. 
D)  the relevant production function has the constant-returns-to-scale property. 
A)  the production process cannot be enhanced by technological advances. 
B)  no mathematical representation of the relevant production function can be formulated. 
C)  the relevant production function has the limits-to-growth property. 
D)  the relevant production function has the constant-returns-to-scale property.

Question 6

"When workers have a relatively small quantity of capital to use in producing goods and services,giving them an additional unit of capital increases their productivity by a relatively large amount." This statement

Accepted Answer

A)  is an assertion that production functions have the property of constant returns to scale. 
B)  is consistent with the view that capital is subject to diminishing returns. 
C)  is inconsistent with the view that it is easier for a country to grow fast if it starts out relatively poor. 
D)  All of the above are correct. 
A)  is an assertion that production functions have the property of constant returns to scale. 
B)  is consistent with the view that capital is subject to diminishing returns. 
C)  is inconsistent with the view that it is easier for a country to grow fast if it starts out relatively poor. 
D)  All of the above are correct.

Question 7

The logic behind the catch-up effect is that

Accepted Answer

A)  workers in countries with low incomes will work more hours than workers in countries with high incomes. 
B)  the capital stock in rich countries deteriorates at a higher rate because it already has a lot of capital. 
C)  new capital adds more to production in a country that doesn't have much capital than in a country that already has much capital. 
D)  None of the above is correct. 
A)  workers in countries with low incomes will work more hours than workers in countries with high incomes. 
B)  the capital stock in rich countries deteriorates at a higher rate because it already has a lot of capital. 
C)  new capital adds more to production in a country that doesn't have much capital than in a country that already has much capital. 
D)  None of the above is correct.

Question 8

Rapid population growth

Accepted Answer

A)  was hailed by Thomas Robert Malthus as the key to future economic growth. 
B)  tends to lead to higher levels of educational attainment. 
C)  is the main reason that less developed nations are poor. 
D)  may depress economic prosperity by reducing the amount of capital which each worker has to work with. 
A)  was hailed by Thomas Robert Malthus as the key to future economic growth. 
B)  tends to lead to higher levels of educational attainment. 
C)  is the main reason that less developed nations are poor. 
D)  may depress economic prosperity by reducing the amount of capital which each worker has to work with.

Question 9

In the long run,a higher saving rate

Accepted Answer

A)  cannot increase the capital stock. 
B)  increases the growth rate of income. 
C)  increases the growth rate of productivity. 
D)  None of the above is correct. 
A)  cannot increase the capital stock. 
B)  increases the growth rate of income. 
C)  increases the growth rate of productivity. 
D)  None of the above is correct.

Question 10

Other things the same,a country that increases its saving rate increases

Accepted Answer

A)  its future productivity and future real GDP. 
B)  neither its future productivity nor future real GDP. 
C)  its future productivity,but not its future real GDP. 
D)  its future real GDP,but not its future productivity. 
A)  its future productivity and future real GDP. 
B)  neither its future productivity nor future real GDP. 
C)  its future productivity,but not its future real GDP. 
D)  its future real GDP,but not its future productivity.

Question 11

What is a production function? Write an equation for a typical production function,and explain what each of the terms represents.

Accepted Answer

A production function is a mathematical

Question 12

Over the past 100 years,U.S.real GDP per person has doubled about every 35 years.If,in the next 100 years,it doubles every 25 years,then a century from now U.S.real GDP per person will be

Accepted Answer

A)  4 times higher than it is now. 
B)  8 times higher than it is now. 
C)  12 times higher than it is now. 
D)  16 times higher than it is now. 
A)  4 times higher than it is now. 
B)  8 times higher than it is now. 
C)  12 times higher than it is now. 
D)  16 times higher than it is now.

Question 13

Human capital is the

Accepted Answer

A)  knowledge and skills that workers acquire through education,training,and experience. 
B)  stock of equipment and structures that is used to produce goods and services. 
C)  total number of hours worked in an economy. 
D)  same thing as technological knowledge. 
A)  knowledge and skills that workers acquire through education,training,and experience. 
B)  stock of equipment and structures that is used to produce goods and services. 
C)  total number of hours worked in an economy. 
D)  same thing as technological knowledge.

Question 14

In 2006,real GDP per person in Bangladesh was

Accepted Answer

A)  about 3 times as high as it was in the U.S.in 1870. 
B)  about twice as high as it was in the U.S.in 1870. 
C)  about the same as it was in the U.S.in 1870. 
D)  less than it was in the U.S.in 1870. 
A)  about 3 times as high as it was in the U.S.in 1870. 
B)  about twice as high as it was in the U.S.in 1870. 
C)  about the same as it was in the U.S.in 1870. 
D)  less than it was in the U.S.in 1870.

Question 15

Last year Panglossia had real GDP of 27.0 billion.This year it had real GDP of 31.5 billion.Which of the following changes in population is consistent with a 5 percent growth rate of real GDP per person over the last year?

Accepted Answer

A)  The population decreased from 88 million to 84 million. 
B)  The population decreased from 75 million to 73 million. 
C)  The population increased from 45 million to 50 million. 
D)  The population increased from 60 million to 62 million. 
A)  The population decreased from 88 million to 84 million. 
B)  The population decreased from 75 million to 73 million. 
C)  The population increased from 45 million to 50 million. 
D)  The population increased from 60 million to 62 million.

Question 16

Use the data on U.S.real GDP below to compute real GDP per person for each year.Then use these numbers to compute the percentage increase in real GDP per person from 1987 to 2005.

Accepted Answer

Real GDP per person in 1987 wa

Question 17

An increase in capital increases productivity only if it is purchased and operated by domestic residents.

Accepted Answer

A) True 
 B)False

Question 18

Productivity

Accepted Answer

A)  is nearly the same across countries,and so provides no help explaining differences in the standard of living across countries. 
B)  explains very little of the differences in the standard of living across countries. 
C)  explains some,but not most of the differences in the standard of living across countries. 
D)  explains most of the differences in the standard of living across countries. 
A)  is nearly the same across countries,and so provides no help explaining differences in the standard of living across countries. 
B)  explains very little of the differences in the standard of living across countries. 
C)  explains some,but not most of the differences in the standard of living across countries. 
D)  explains most of the differences in the standard of living across countries.

Question 19

In 2006,the imaginary nation of Viloxia had a population of 5,000 and real GDP of 500,000.In 2007 it had a population of 5,100 and real GDP of 520,200.Over the year in question,real GDP per person in Viloxia grew by

Accepted Answer

A)  2 percent,which is high compared to average U.S.growth over the last one-hundred years. 
B)  2 percent,which is about the same as average U.S.growth over the last one-hundred years. 
C)  4 percent,which is high compared to average U.S.growth over the last one-hundred years. 
D)  4 percent,which is about the same as average U.S.growth over the last one-hundred years. 
A)  2 percent,which is high compared to average U.S.growth over the last one-hundred years. 
B)  2 percent,which is about the same as average U.S.growth over the last one-hundred years. 
C)  4 percent,which is high compared to average U.S.growth over the last one-hundred years. 
D)  4 percent,which is about the same as average U.S.growth over the last one-hundred years.

Question 20

Why is productivity related to the standard of living? In your answer be sure to explain what productivity and standard of living mean.Make a list of things that determine labor productivity.

Accepted Answer

The standard of living is a measure of h

Exam 25: Production and Growth

In 8 hours,Sonja produces 8 units of goods and services.In 10 hours,Emma produces 9 units of goods and services.It follows that

Which of the following items plays a role in determining productivity?

In the United States,as measured by real GDP per person,average income is about how many times as high as average income a century ago?

A barber shop produces 96 haircuts a day.Each barber in the shop works 8 hours per day and produces the same number of haircuts per hour.If the shop's productivity is 3 haircuts per hour of labor,then how many barbers does the shop employ?

In a particular production process,if the quantities of all inputs used are increased by 60 percent,then the quantity of output increases by 60 percent as well.This means that

"When workers have a relatively small quantity of capital to use in producing goods and services,giving them an additional unit of capital increases their productivity by a relatively large amount." This statement

The logic behind the catch-up effect is that

Rapid population growth

In the long run,a higher saving rate

Other things the same,a country that increases its saving rate increases

What is a production function? Write an equation for a typical production function,and explain what each of the terms represents.

Over the past 100 years,U.S.real GDP per person has doubled about every 35 years.If,in the next 100 years,it doubles every 25 years,then a century from now U.S.real GDP per person will be

Human capital is the

In 2006,real GDP per person in Bangladesh was

Last year Panglossia had real GDP of 27.0 billion.This year it had real GDP of 31.5 billion.Which of the following changes in population is consistent with a 5 percent growth rate of real GDP per person over the last year?

Use the data on U.S.real GDP below to compute real GDP per person for each year.Then use these numbers to compute the percentage increase in real GDP per person from 1987 to 2005.

An increase in capital increases productivity only if it is purchased and operated by domestic residents.

Productivity

In 2006,the imaginary nation of Viloxia had a population of 5,000 and real GDP of 500,000.In 2007 it had a population of 5,100 and real GDP of 520,200.Over the year in question,real GDP per person in Viloxia grew by

Why is productivity related to the standard of living? In your answer be sure to explain what productivity and standard of living mean.Make a list of things that determine labor productivity.

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, Demand, and Government Policies

Consumers, Producers, and the Efficiency of Markets

Application: The Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers of Microeconomics

Measuring a Nations Income

Measuring the Cost of Living

Saving, investment, and the Financial System

The Basic Tools of Finance

Unemployment

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Trade-Off Between Inflation and Unemployment

Five Debates Over Macroeconomic Policy

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