Exam 12: Production and Growth: Part B

If a country made it easier for people to establish and prove the ownership of their property,real GDP per person would likely rise.

Both the standard of living and the growth of real GDP per person vary widely across countries.

If your company opens and operates a branch in a foreign country,your company engages in foreign direct investment.

If Country A produces 7,000 units of goods and services using 700 hours of labor,and if Country B produces 5,500 units of goods and services using 500 units of labor,then productivity is lower in Country A than in Country B.

Other things the same,domestic investment will increase a country's real GDP by more than foreign investment.

One reason that governments may find it useful to sponsor universities and basic research is that to a large extent knowledge is generally a private good.

A country's standard of living depends on its ability to produce goods and services.

Other things the same,another unit of capital will increase output by more in a poor country than in a rich country.

Foreign direct investment and domestic investment have the same effect on all measures of economic prosperity.

It is possible for a country without a lot of domestic natural resources to have a high standard of living.

In some countries in Sub-Saharan Africa real GDP per person has been stagnant for many years.

A forest is an example of a nonrenewable resource.

An increase in the saving rate permanently increases the growth rate of real GDP per person.

Constant returns to scale is the point on a production function where increasing inputs will no longer increase output.

The population growth rate tends to be higher in developed countries than in developing countries.

Economist Michael Kremer found that world growth rates fell as population increased.

Economists generally believe that policies such as reducing barriers to trade are likely to foster economic growth.

Increases in both human capital per worker and physical capital per worker increase productivity.

International data on real GDP per person gives us a sense of how standards of living vary across countries.

A country that made its courts less corrupt and its government more stable would likely see its standard of living rise.