Question 1

Which feature of the data can the Solow growth model not replicate?

Accepted Answer

A)  There is a widening gap between income levels across countries. 
B)  The investment rate is positively related to the income per worker. 
C)  The population growth rate is negatively related to the income per worker. 
D)  An increase in the savings rate causes an increase in income per worker. 
E)  In developed countries, there is steady growth in income per capita. 
A)  There is a widening gap between income levels across countries. 
B)  The investment rate is positively related to the income per worker. 
C)  The population growth rate is negatively related to the income per worker. 
D)  An increase in the savings rate causes an increase in income per worker. 
E)  In developed countries, there is steady growth in income per capita.

Question 2

Which of the following is a possible explanation for why growth in real GDP per-capita in Canada has not returned to its linear trend after the most recent recession?

Accepted Answer

A)  Canada has experienced a level adjustment to a lower growth path. 
B)  There has been a decrease in population growth. 
C)  There has been an increase in population growth. 
D)  There has been a constant level of savings combined with increased population growth. 
E)  There has been a prolonged slowdown of growth in the U.S. economy. 
A)  Canada has experienced a level adjustment to a lower growth path. 
B)  There has been a decrease in population growth. 
C)  There has been an increase in population growth. 
D)  There has been a constant level of savings combined with increased population growth. 
E)  There has been a prolonged slowdown of growth in the U.S. economy.

Question 3

The golden rule savings rate is achieved when capital is accumulated at a rate that

Accepted Answer

A)  maximizes consumption per worker in the steady state. 
B)  keeps consumption per worker constant in the steady state. 
C)  population growth exceeds the depreciation rate. 
D)  minimizes the effects of consumption growth on population growth. 
E)  minimizes consumption per worker in the steady state. 
A)  maximizes consumption per worker in the steady state. 
B)  keeps consumption per worker constant in the steady state. 
C)  population growth exceeds the depreciation rate. 
D)  minimizes the effects of consumption growth on population growth. 
E)  minimizes consumption per worker in the steady state.

Question 4

One plausible explanation of the Canadian productivity slowdown starting in 1973 is that it was a result of the increase in the relative price of energy.This explanation would require that,in light of higher energy costs,the

Accepted Answer

A)  capital stock is overestimated. 
B)  capital stock is underestimated. 
C)  labour force is overestimated. 
D)  labour force is underestimated. 
E)  capital stock and the labour force were overestimated. 
A)  capital stock is overestimated. 
B)  capital stock is underestimated. 
C)  labour force is overestimated. 
D)  labour force is underestimated. 
E)  capital stock and the labour force were overestimated.

Question 5

Rates of growth of real per capita income are most alike amongst

Accepted Answer

A)  the richest countries and the poorest countries. 
B)  the richest countries but not the poorest countries. 
C)  the poorest countries but not the richest countries. 
D)  neither the richest nor the poorest countries. 
E)  the U.S. and in Africa. 
A)  the richest countries and the poorest countries. 
B)  the richest countries but not the poorest countries. 
C)  the poorest countries but not the richest countries. 
D)  neither the richest nor the poorest countries. 
E)  the U.S. and in Africa.

Question 6

In the Malthusian model,the long-run standard of living is determined entirely by the function g(c),which describes how

Accepted Answer

A)  consumption per worker drives population growth. 
B)  technology affects the growth of output. 
C)  the death rate depends on technological change. 
D)  the birth rate depends on population growth. 
E)  consumption per worker drives production. 
A)  consumption per worker drives population growth. 
B)  technology affects the growth of output. 
C)  the death rate depends on technological change. 
D)  the birth rate depends on population growth. 
E)  consumption per worker drives production.

Question 7

In Solow's exogenous growth model,the principal obstacle to continuous growth in output per capita is due to

Accepted Answer

A)  the declining marginal product of labour. 
B)  the declining marginal product of capital. 
C)  limits in the ability of government policy makers. 
D)  too little savings. 
E)  not enough consumption per worker. 
A)  the declining marginal product of labour. 
B)  the declining marginal product of capital. 
C)  limits in the ability of government policy makers. 
D)  too little savings. 
E)  not enough consumption per worker.

Question 8

Malthus was too pessimistic because he did not foresee the effects of

Accepted Answer

A)  ever increasing amounts of land for cultivation. 
B)  increases in the capital stock and the effects of such increases on production. 
C)  improved nutrition and health care. 
D)  improved family planning practices. 
E)  increase productivity of land. 
A)  ever increasing amounts of land for cultivation. 
B)  increases in the capital stock and the effects of such increases on production. 
C)  improved nutrition and health care. 
D)  improved family planning practices. 
E)  increase productivity of land.

Question 9

In the steady state of Solow's exogenous growth model,an increase in the growth rate of labour force

Accepted Answer

A)  increases output per worker and increases capital per worker. 
B)  increases output per worker and decreases capital per worker. 
C)  decreases output per worker and increases capital per worker. 
D)  decreases output per worker and decreases capital per worker. 
E)  decreases output per worker and the marginal product of labour. 
A)  increases output per worker and increases capital per worker. 
B)  increases output per worker and decreases capital per worker. 
C)  decreases output per worker and increases capital per worker. 
D)  decreases output per worker and decreases capital per worker. 
E)  decreases output per worker and the marginal product of labour.

Question 10

In the Malthusian model of the economy,

Accepted Answer

A)  there is no investment or government spending. 
B)  capital replaces land in the production function. 
C)  the model is static with only one period. 
D)  population growth depends on income per worker. 
E)  population growth is negatively correlated with consumption. 
A)  there is no investment or government spending. 
B)  capital replaces land in the production function. 
C)  the model is static with only one period. 
D)  population growth depends on income per worker. 
E)  population growth is negatively correlated with consumption.

Question 11

In an endogenous growth model,growth is caused by

Accepted Answer

A)  forces determined by the model. 
B)  capital accumulation. 
C)  human capital accumulation. 
D)  forces that are not determined by the model itself. 
E)  total factor productivity. 
A)  forces determined by the model. 
B)  capital accumulation. 
C)  human capital accumulation. 
D)  forces that are not determined by the model itself. 
E)  total factor productivity.

Question 12

In the steady state of Solow's exogenous growth model,an increase in the population growth rate

Accepted Answer

A)  increases output per worker and increases capital per worker. 
B)  increases output per worker and decreases capital per worker. 
C)  decreases output per worker and increases capital per worker. 
D)  decreases output per worker and decreases capital per worker. 
E)  decreases output per worker and the marginal product of labour. 
A)  increases output per worker and increases capital per worker. 
B)  increases output per worker and decreases capital per worker. 
C)  decreases output per worker and increases capital per worker. 
D)  decreases output per worker and decreases capital per worker. 
E)  decreases output per worker and the marginal product of labour.

Question 13

One plausible explanation of Canadian productivity slowdown starting in 1973 is measurement problems. This explanation would require which of the following measurement problems?

Accepted Answer

A)  Production tends to be overestimated. 
B)  Goods is overestimated. 
C)  Changes in the quality of goods and services. 
D)  Services is overestimated. 
E)  Goods and services were overestimated. 
A)  Production tends to be overestimated. 
B)  Goods is overestimated. 
C)  Changes in the quality of goods and services. 
D)  Services is overestimated. 
E)  Goods and services were overestimated.

Question 14

According to the Solow growth model,in the long-run steady state,all real aggregate quantities grow

Accepted Answer

A)  according to the savings rate in the economy, s. 
B)  at the rate n, the growth rate of the labour force. 
C)  at the same rate as per worker capital. 
D)  depending on how consumption affects population growth. 
E)  at the same rate as consumption per worker. 
A)  according to the savings rate in the economy, s. 
B)  at the rate n, the growth rate of the labour force. 
C)  at the same rate as per worker capital. 
D)  depending on how consumption affects population growth. 
E)  at the same rate as consumption per worker.

Question 15

In the Malthusian model,state-mandated population control policies are likely to

Accepted Answer

A)  decrease the equilibrium size of the population and increase the equilibrium level of consumption per worker. 
B)  decrease the equilibrium size of the population and have no effect on the equilibrium level of consumption per worker. 
C)  have no effect on the equilibrium size of the population and increase the equilibrium level of consumption per worker. 
D)  have no effect on the either equilibrium size of the population and the equilibrium level of consumption per worker. 
E)  have no effect on the equilibrium size of the population or the equilibrium level of consumption per worker. 
A)  decrease the equilibrium size of the population and increase the equilibrium level of consumption per worker. 
B)  decrease the equilibrium size of the population and have no effect on the equilibrium level of consumption per worker. 
C)  have no effect on the equilibrium size of the population and increase the equilibrium level of consumption per worker. 
D)  have no effect on the either equilibrium size of the population and the equilibrium level of consumption per worker. 
E)  have no effect on the equilibrium size of the population or the equilibrium level of consumption per worker.

Question 16

Before the Industrial Revolution,standards of living differed

Accepted Answer

A)  greatly over time and across countries. 
B)  little over time but differed greatly across countries. 
C)  greatly over time but differed little across countries. 
D)  little over time and across countries. 
E)  greatly over time, but was the same across countries. 
A)  greatly over time and across countries. 
B)  little over time but differed greatly across countries. 
C)  greatly over time but differed little across countries. 
D)  little over time and across countries. 
E)  greatly over time, but was the same across countries.

Question 17

Growth in the Solow residual was fastest in the

Accepted Answer

A)  1950s. 
B)  1960s. 
C)  1970s. 
D)  1980s. 
E)  1990s. 
A)  1950s. 
B)  1960s. 
C)  1970s. 
D)  1980s. 
E)  1990s.

Question 18

What are the key differences between the Malthusian and Solow models of economic growth?

Accepted Answer

The Malthusian model contains no investm

Question 19

The per worker production function describes the relationship between

Accepted Answer

A)  consumption per worker and income per worker. 
B)  capital per worker and total factor productivity. 
C)  output per worker and land per worker. 
D)  labour supply and land per worker. 
E)  government spending and total factor productivity. 
A)  consumption per worker and income per worker. 
B)  capital per worker and total factor productivity. 
C)  output per worker and land per worker. 
D)  labour supply and land per worker. 
E)  government spending and total factor productivity.

Question 20

The Malthusian model has the property that

Accepted Answer

A)  increased education levels leads to increased population growth. 
B)  increased consumption leads to increased population growth. 
C)  increased capital stock leads to increased total factor productivity. 
D)  improvements in technology for producing goods leads to increased population growth. 
E)  improvements in standards of living leads to population growth. 
A)  increased education levels leads to increased population growth. 
B)  increased consumption leads to increased population growth. 
C)  increased capital stock leads to increased total factor productivity. 
D)  improvements in technology for producing goods leads to increased population growth. 
E)  improvements in standards of living leads to population growth.

Which feature of the data can the Solow growth model not replicate?

Which of the following is a possible explanation for why growth in real GDP per-capita in Canada has not returned to its linear trend after the most recent recession?

The golden rule savings rate is achieved when capital is accumulated at a rate that

One plausible explanation of the Canadian productivity slowdown starting in 1973 is that it was a result of the increase in the relative price of energy.This explanation would require that,in light of higher energy costs,the

Rates of growth of real per capita income are most alike amongst

In the Malthusian model,the long-run standard of living is determined entirely by the function g(c),which describes how

In Solow's exogenous growth model,the principal obstacle to continuous growth in output per capita is due to

Malthus was too pessimistic because he did not foresee the effects of

In the steady state of Solow's exogenous growth model,an increase in the growth rate of labour force

In the Malthusian model of the economy,

In an endogenous growth model,growth is caused by

In the steady state of Solow's exogenous growth model,an increase in the population growth rate

One plausible explanation of Canadian productivity slowdown starting in 1973 is measurement problems. This explanation would require which of the following measurement problems?

According to the Solow growth model,in the long-run steady state,all real aggregate quantities grow

In the Malthusian model,state-mandated population control policies are likely to

Before the Industrial Revolution,standards of living differed

Growth in the Solow residual was fastest in the

What are the key differences between the Malthusian and Solow models of economic growth?

The per worker production function describes the relationship between

The Malthusian model has the property that

Introduction

Measurement

Business Cycle Measurement

Consumer and Firm Behavior: The Work–Leisure Decision and Profit Maximization

A Closed-Economy One-Period Macroeconomic Model

Search and Unemployment

Income Disparity Among Countries and Endogenous Growth

A Two-Period Model: The Consumption–Savings Decision and Credit Markets

Credit Market Imperfections: Credit Frictions, Financial Crises, and Social Security

A Real Intertemporal Model with Investment

Money, Banking, Prices, and Monetary Policy

Business Cycle Models with Flexible Prices and Wages

New Keynesian Economics: Sticky Prices

Inflation: Phillips Curves and Neo-Fisherism

International Trade in Goods and Assets

Money in the Open Economy

Money, Inflation, and Banking: A Deeper Look

Filters

Exam 7: Economic Growth: Malthus and Solow

Which feature of the data can the Solow growth model not replicate?

Which of the following is a possible explanation for why growth in real GDP per-capita in Canada has not returned to its linear trend after the most recent recession?

The golden rule savings rate is achieved when capital is accumulated at a rate that

One plausible explanation of the Canadian productivity slowdown starting in 1973 is that it was a result of the increase in the relative price of energy.This explanation would require that,in light of higher energy costs,the

Rates of growth of real per capita income are most alike amongst

In the Malthusian model,the long-run standard of living is determined entirely by the function g(c),which describes how

In Solow's exogenous growth model,the principal obstacle to continuous growth in output per capita is due to

Malthus was too pessimistic because he did not foresee the effects of

In the steady state of Solow's exogenous growth model,an increase in the growth rate of labour force

In the Malthusian model of the economy,

In an endogenous growth model,growth is caused by

In the steady state of Solow's exogenous growth model,an increase in the population growth rate

One plausible explanation of Canadian productivity slowdown starting in 1973 is measurement problems. This explanation would require which of the following measurement problems?

According to the Solow growth model,in the long-run steady state,all real aggregate quantities grow

In the Malthusian model,state-mandated population control policies are likely to

Before the Industrial Revolution,standards of living differed

Growth in the Solow residual was fastest in the

What are the key differences between the Malthusian and Solow models of economic growth?

The per worker production function describes the relationship between

The Malthusian model has the property that

Introduction

Measurement

Business Cycle Measurement

Consumer and Firm Behavior: The Work–Leisure Decision and Profit Maximization

A Closed-Economy One-Period Macroeconomic Model

Search and Unemployment

Income Disparity Among Countries and Endogenous Growth

A Two-Period Model: The Consumption–Savings Decision and Credit Markets

Credit Market Imperfections: Credit Frictions, Financial Crises, and Social Security

A Real Intertemporal Model with Investment

Money, Banking, Prices, and Monetary Policy

Business Cycle Models with Flexible Prices and Wages

New Keynesian Economics: Sticky Prices

Inflation: Phillips Curves and Neo-Fisherism

International Trade in Goods and Assets

Money in the Open Economy

Money, Inflation, and Banking: A Deeper Look

Filters