Question 1

If population is expanding at a faster rate than a country's real output is expanding:

Accepted Answer

A)  real per capita output would increase. 
B)  real per capita output would decrease. 
C)  the production possibilities curve for the country as a whole will be shifting outward. 
D)  both (b) and (c) would be true. 
A)  real per capita output would increase. 
B)  real per capita output would decrease. 
C)  the production possibilities curve for the country as a whole will be shifting outward. 
D)  both (b) and (c) would be true.

Question 2

Which of the following will not increase the rate of growth in an economy?

Accepted Answer

A)  a reduction in the rate of savings 
B)  an increase in the productivity of labor 
C)  technological progress 
D)  higher rates of investment 
A)  a reduction in the rate of savings 
B)  an increase in the productivity of labor 
C)  technological progress 
D)  higher rates of investment

Question 3

Which of the following did not result in economic growth?

Accepted Answer

A)  Installing a network of irrigation ditches and pumping stations in order to grow fruits and vegetables in parts of southern California 
B)  Cyrus McCormack inventing a threshing machine for harvesting grains 
C)  After World War II, the U.S. instituting the GI bill, which provided education subsidies to soldiers being released from service duty 
D)  Many citizens emigrating from a nation when a politically repressive regime takes office 
A)  Installing a network of irrigation ditches and pumping stations in order to grow fruits and vegetables in parts of southern California 
B)  Cyrus McCormack inventing a threshing machine for harvesting grains 
C)  After World War II, the U.S. instituting the GI bill, which provided education subsidies to soldiers being released from service duty 
D)  Many citizens emigrating from a nation when a politically repressive regime takes office

Question 4

Which of the following factors contribute to economic growth?

Accepted Answer

A)  the construction of new factories 
B)  an increase in the proportion of the population that is college-educated 
C)  a decrease in the productivity of labor 
D)  only (a) and (b). 
A)  the construction of new factories 
B)  an increase in the proportion of the population that is college-educated 
C)  a decrease in the productivity of labor 
D)  only (a) and (b).

Question 5

Thomas Malthus's predictions did not come to pass because he implicitly assumed that there would be no technological advances and did not foresee that agricultural land was not completely fixed in quantity or quality.

Accepted Answer

A) True 
 B)False

Question 6

Exhibit 20-1   Refer to Exhibit 20-1.Which nation has the lowest growth rate?

Accepted Answer

A)  Nation A 
B)  Nation B 
C)  Nation C 
D)  Nation D 
A)  Nation A 
B)  Nation B 
C)  Nation C 
D)  Nation D

Question 7

Which of the following is false?

Accepted Answer

A)  Accepting a reduction in current income to acquire education and training can increase future earning ability, which can raise the standard of living. 
B)  Improvements in literacy stimulate economic growth by reducing barriers to the flow of information and raising labor productivity. 
C)  One problem of providing enough education in poorer countries is that since children in developing countries are an important part of the labor force at a young age, there is a higher opportunity cost of education in terms of foregone contribution to family income. 
D)  Investment alone guarantees economic growth per capita. 
A)  Accepting a reduction in current income to acquire education and training can increase future earning ability, which can raise the standard of living. 
B)  Improvements in literacy stimulate economic growth by reducing barriers to the flow of information and raising labor productivity. 
C)  One problem of providing enough education in poorer countries is that since children in developing countries are an important part of the labor force at a young age, there is a higher opportunity cost of education in terms of foregone contribution to family income. 
D)  Investment alone guarantees economic growth per capita.

Question 8

It is impossible to have economic growth unless a country or a region has abundant natural resources to sustain the growth.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following best describes the relationship between economic growth and literacy?

Accepted Answer

A)  As the economy grows, literacy declines because it becomes less and less useful in a developed economy. 
B)  Increased literacy initially stimulates economic growth by raising labor productivity, but as the economy grows and the opportunity cost of education rises, literacy declines. 
C)  Increased literacy stimulates economic growth by raising labor productivity, and as the economy grows, people consume more education. 
D)  There is no correlation between economic growth and literacy. 
A)  As the economy grows, literacy declines because it becomes less and less useful in a developed economy. 
B)  Increased literacy initially stimulates economic growth by raising labor productivity, but as the economy grows and the opportunity cost of education rises, literacy declines. 
C)  Increased literacy stimulates economic growth by raising labor productivity, and as the economy grows, people consume more education. 
D)  There is no correlation between economic growth and literacy.

Question 10

In a fully employed economy,invention and discovery:

Accepted Answer

A)  are automatic. 
B)  are achieved through sacrifices in current consumption. 
C)  have negative opportunity costs. 
D)  All of the above are correct. 
A)  are automatic. 
B)  are achieved through sacrifices in current consumption. 
C)  have negative opportunity costs. 
D)  All of the above are correct.

Question 11

In any country,the population will generally be better off as long as the ____ over time and population ____.

Accepted Answer

A)  quantity and quality of output decreases; does not increase faster than real output 
B)  quantity and quality of output increases; increases faster than real output 
C)  quantity and quality of output increases; does not increase faster than real output 
D)  technology improves; increases faster than real output 
A)  quantity and quality of output decreases; does not increase faster than real output 
B)  quantity and quality of output increases; increases faster than real output 
C)  quantity and quality of output increases; does not increase faster than real output 
D)  technology improves; increases faster than real output

Question 12

If there was an increase in technology other things equal,real GDP growth would ____ and real GDP growth per capita would ____.

Accepted Answer

A)  increase; increase. 
B)  increase; be indeterminate. 
C)  decrease; decrease. 
D)  decrease; be indeterminate 
A)  increase; increase. 
B)  increase; be indeterminate. 
C)  decrease; decrease. 
D)  decrease; be indeterminate

Question 13

Over the last several decades,the amount of government investment in U.S.infrastructure in real terms has:

Accepted Answer

A)  remained the same. 
B)  decreased. 
C)  increased marginally. 
D)  increased substantially. 
A)  remained the same. 
B)  decreased. 
C)  increased marginally. 
D)  increased substantially.

Question 14

Economies of large-scale production may exist in some forms of production,so larger markets associated with greater populations can lead to more efficiently sized production units.

Accepted Answer

A) True 
 B)False

Question 15

New growth theorists believe that increased economic growth is primarily driven by:

Accepted Answer

A)  higher level of savings. 
B)  higher level of capital investments. 
C)  increased foreign investment. 
D)  technological innovation and ideas. 
A)  higher level of savings. 
B)  higher level of capital investments. 
C)  increased foreign investment. 
D)  technological innovation and ideas.

Question 16

People who make the arguments that economic growth will deplete natural resources make the same assumption Malthus made about resources.What is that assumption?

Accepted Answer

A)  Natural resources will never run out because they are freely available from nature. 
B)  Natural resources cannot be produced, so they are available in fixed quantities. 
C)  That new technology will limit our dependence on natural resources so they won't be depleted. 
D)  That the government will eventually step in to save the natural resources from depletion. 
A)  Natural resources will never run out because they are freely available from nature. 
B)  Natural resources cannot be produced, so they are available in fixed quantities. 
C)  That new technology will limit our dependence on natural resources so they won't be depleted. 
D)  That the government will eventually step in to save the natural resources from depletion.

Question 17

If there was both an increase in technology and an increase in labor force participation,real GDP growth would ____ and real GDP growth per capita would ____.

Accepted Answer

A)  increase: increase 
B)  be indeterminate; be indeterminate 
C)  be indeterminate; decrease 
D)  increase; be indeterminate 
A)  increase: increase 
B)  be indeterminate; be indeterminate 
C)  be indeterminate; decrease 
D)  increase; be indeterminate

Question 18

Free trade can promote greater output because of the principle of comparative advantage.

Accepted Answer

A) True 
 B)False

Question 19

A nation can achieve higher economic growth if:

Accepted Answer

A)  it devotes more resources to research and development. 
B)  the productivity of labor declines. 
C)  taxes are imposed on investment in capital. 
D)  more resources are allocated to consumption goods. 
A)  it devotes more resources to research and development. 
B)  the productivity of labor declines. 
C)  taxes are imposed on investment in capital. 
D)  more resources are allocated to consumption goods.

Question 20

Improvements in literacy stimulate economic growth by:

Accepted Answer

A)  reducing the barriers to the flow of information. 
B)  improving the flow of resources to more productive uses. 
C)  imparting skills, which raises labor productivity. 
D)  doing all of the above. 
A)  reducing the barriers to the flow of information. 
B)  improving the flow of resources to more productive uses. 
C)  imparting skills, which raises labor productivity. 
D)  doing all of the above.

Exam 20: Economic Growth in the Global Economy

If population is expanding at a faster rate than a country's real output is expanding:

Which of the following will not increase the rate of growth in an economy?

Which of the following did not result in economic growth?

Which of the following factors contribute to economic growth?

Thomas Malthus's predictions did not come to pass because he implicitly assumed that there would be no technological advances and did not foresee that agricultural land was not completely fixed in quantity or quality.

Exhibit 20-1 Refer to Exhibit 20-1.Which nation has the lowest growth rate?

Which of the following is false?

It is impossible to have economic growth unless a country or a region has abundant natural resources to sustain the growth.

Which of the following best describes the relationship between economic growth and literacy?

In a fully employed economy,invention and discovery:

In any country,the population will generally be better off as long as the ____ over time and population ____.

If there was an increase in technology other things equal,real GDP growth would ____ and real GDP growth per capita would ____.

Over the last several decades,the amount of government investment in U.S.infrastructure in real terms has:

Economies of large-scale production may exist in some forms of production,so larger markets associated with greater populations can lead to more efficiently sized production units.

New growth theorists believe that increased economic growth is primarily driven by:

People who make the arguments that economic growth will deplete natural resources make the same assumption Malthus made about resources.What is that assumption?

If there was both an increase in technology and an increase in labor force participation,real GDP growth would ____ and real GDP growth per capita would ____.

Free trade can promote greater output because of the principle of comparative advantage.

A nation can achieve higher economic growth if:

Improvements in literacy stimulate economic growth by:

The Role and Method of Economics

Economics: Eight Powerful Ideas

Scarcity, Trade-Offs, and Production Possibilities

Demand, Supply, and Market Equilibrium

Markets in Motion and Price Controls

Elasticities

Market Efficiency and Welfare

Market Failure

Public Finance and Public Choice

Consumer Choice Theory

The Firm: Production and Costs

Firms in Perfectly Competitive Markets

Monopoly and Antitrust

Monopolistic Competition and Product Differentiation

Oligopoly and Strategic Behavior

The Markets for Labor, Capital, and Land

Income, Poverty, and Health Care

Introduction to Macroeconomics: Unemployment, Inflation, and Economic Fluctuations

Measuring Economic Performance

Financial Markets, Saving, and Investment

Aggregate Demand and Aggregate Supply

The Aggregate Expenditure Model

Monetary Institutions

The Federal Reserve System and Monetary Policy

Issues in Macroeconomic Theory and Policy

International Trade

International Finance

Filters

In any country,the population will generally be better off as long as the over time and population .

If there was an increase in technology other things equal,real GDP growth would and real GDP growth per capita would .

If there was both an increase in technology and an increase in labor force participation,real GDP growth would and real GDP growth per capita would .