Exam 6: Economic Growth

Neoclassical growth theory attributes economic growth to

Suppose real GDP for a country is $13 trillion in 2015, $14 trillion in 2016, $15 trillion in 2017, and $16 trillion in 2018. Over this time period, the real GDP growth rate is

With no change in labor productivity, what would happen to the real wage rate and potential GDP if the population increased?

Because the productivity of labor decreases as the quantity of labor employed increases

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

According to new growth theory, technological change is driven by

An assumption of the neoclassical theory of growth is that

The relationship between the labor employed by a firm and the real wage rate is shown by the

New growth theory holds that choices, and the discoveries that result from them, result in growth that is temporary in nature.

Moving along the aggregate production function, all of the following are held constant EXCEPT

What is the effect on real GDP per person if labor productivity increases?

-The country of Kemper is on its aggregate production function at point W in the above figure. If the population increases with no change in capital or technology, the economy will

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

-In the above figure, at a wage rate of $20 per hour

A recent article states that "...gains from two centuries of rapid technological innovation are largely exhausted, and new discoveries lack the same revolutionary quality....{Further}, 80 percent of the growth between 1950 and 1993 came from the new application of old ideas, and these old ideas are now mostly wrung dry." (The Economist, 03/03/2011) -Neoclassical growth theory proposes that

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. Armenia's real GDP per person in 2012 was

According to new growth theory ________.

During World War II, the increasing productivity of workers who built ships was due primarily to

Hu Tells Leaders China Growth Will Help World Economy Chinese President Hu Jintao told world leaders that his country "has taken an active part in the international cooperation to deal with the financial crisis'' by providing a "$586 billion economic stimulus, focused on building low-rent housing, roads, railways and airports. The package also allows tax deductions for fixed assets such as machinery to stimulate investment. Farmers will also benefit from more subsidies." Hu stated that "China is in itself an important contribution to international financial stability and world economic growth.'' Www)bloomberg.com 11/15/2008 If the fiscal stimulus spending does generate economic growth, we can expect to see

Which of the following policies improves prospects for more rapid economic growth?