Question 1

One of the best explanations for why some countries are rich and others are poor is that:

Accepted Answer

A)  technological knowledge is more advanced in rich countries than in poor countries. 
B)  rich countries organize their factors of production more efficiently than poor countries. 
C)  rich countries may have simply gotten lucky and poor countries remain unlucky. 
D)  rich countries have far greater natural resources than poor countries. 
A)  technological knowledge is more advanced in rich countries than in poor countries. 
B)  rich countries organize their factors of production more efficiently than poor countries. 
C)  rich countries may have simply gotten lucky and poor countries remain unlucky. 
D)  rich countries have far greater natural resources than poor countries.

Question 2

List the institutions that are important for economic growth as discussed in this chapter.

Accepted Answer

(1)property rights, (2)honest

Question 3

Figure: Growth Miracles and Growth Disasters   According to the information in the figure,Argentina had a higher real GDP per capita in 2000 than it did in 1900.Explain how it can still be considered a growth disaster.Also,discuss what other aspects of Argentina you would study to gain a complete understanding of its economic growth.

Accepted Answer

As indicated in the figure,Argentina has

Question 4

Countries that use markets to organize production tend to have higher growth rates.

Accepted Answer

A) True 
 B)False

Question 5

When an economic system changes from using a collective property rights system to something closer to private property rights,the immediate effect is:

Accepted Answer

A)  less efficient organization of resources. 
B)  to increase regulation,resulting in less market activities. 
C)  to decrease investment,work effort,and productivity. 
D)  to increase investment,work effort,and productivity. 
A)  less efficient organization of resources. 
B)  to increase regulation,resulting in less market activities. 
C)  to decrease investment,work effort,and productivity. 
D)  to increase investment,work effort,and productivity.

Question 6

A legal system that helps raise a nation's productivity is one that:

Accepted Answer

A)  makes it easy for people to engage in contracts and to establish property rights. 
B)  has a lot of regulations and procedures for people and businesses to follow. 
C)  allows people and businesses to act freely and to do just about everything they want. 
D)  protects domestic producers from foreign competition. 
A)  makes it easy for people to engage in contracts and to establish property rights. 
B)  has a lot of regulations and procedures for people and businesses to follow. 
C)  allows people and businesses to act freely and to do just about everything they want. 
D)  protects domestic producers from foreign competition.

Question 7

Landlocked countries tend to grow faster than countries that have access to water.

Accepted Answer

A) True 
 B)False

Question 8

Use the following to answer questions 
Figure: Economic Growth in Major World Regions  
-(Figure: Economic Growth in Major World Regions)Refer to the figure,which shows real GDP per capita over time in different regions of the world.The chart shows that:

Accepted Answer

A)  all regions of the world eventually achieved significant growth. 
B)  some regions of the world have always experienced growth. 
C)  significant growth has occurred in some regions only since 1950. 
D)  all regions of the world remain poor today. 
A)  all regions of the world eventually achieved significant growth. 
B)  some regions of the world have always experienced growth. 
C)  significant growth has occurred in some regions only since 1950. 
D)  all regions of the world remain poor today.

Question 9

Incentives are important in structuring the institutions in a country.

Accepted Answer

A) True 
 B)False

Question 10

Good institutions:

Accepted Answer

A)  reward those who create value and increase efficiency with higher profits. 
B)  distribute wealth evenly across the economy. 
C)  result in growth rates approximately equal to those in countries with poor institutions. 
D)  matter only if the country has a large amount of both physical and human capital. 
A)  reward those who create value and increase efficiency with higher profits. 
B)  distribute wealth evenly across the economy. 
C)  result in growth rates approximately equal to those in countries with poor institutions. 
D)  matter only if the country has a large amount of both physical and human capital.

Question 11

Which is NOT a factor of production?

Accepted Answer

A)  incentives 
B)  human capital 
C)  physical capital 
D)  technological knowledge 
A)  incentives 
B)  human capital 
C)  physical capital 
D)  technological knowledge

Question 12

Countries with a high GDP per capita have a lot of physical and human capital organized by means of the best technological knowledge available.

Accepted Answer

A) True 
 B)False

Question 13

A country increases its human capital by engaging in:

Accepted Answer

A)  research and development. 
B)  education and training. 
C)  programs that improve workers' health. 
D)  investment in physical capital. 
A)  research and development. 
B)  education and training. 
C)  programs that improve workers' health. 
D)  investment in physical capital.

Question 14

Why did so many Chinese farmers and workers starve under "The Great Leap Forward"?

Accepted Answer

A)  The number of workers on communes was reduced. 
B)  The Chinese people did not know how to farm in certain geographic areas. 
C)  The incentive to work hard was low since the rewards were so minimal. 
D)  A long,severe drought drastically decreased agricultural production. 
A)  The number of workers on communes was reduced. 
B)  The Chinese people did not know how to farm in certain geographic areas. 
C)  The incentive to work hard was low since the rewards were so minimal. 
D)  A long,severe drought drastically decreased agricultural production.

Question 15

China's experiment with communal farming caused agricultural production to plummet and millions starved to death as a result.

Accepted Answer

A) True 
 B)False

Question 16

For most of recorded human history,people were poor and there was no economic growth.

Accepted Answer

A) True 
 B)False

Question 17

GDP per capita does not vary much among nations.

Accepted Answer

A) True 
 B)False

Question 18

According to the rule of 70,a country with an annual growth rate of 7% will double its GDP per capita in:

Accepted Answer

A)  70 years. 
B)  10 years. 
C)  7 years. 
D)  less than 1 year. 
A)  70 years. 
B)  10 years. 
C)  7 years. 
D)  less than 1 year.

Question 19

Slow economic growth sustained over long periods produces:

Accepted Answer

A)  small changes in per capita GDP. 
B)  large changes in per capita GDP. 
C)  no changes in per capita GDP. 
D)  unpredictable changes in GDP. 
A)  small changes in per capita GDP. 
B)  large changes in per capita GDP. 
C)  no changes in per capita GDP. 
D)  unpredictable changes in GDP.

Question 20

Under communal property,effort is:

Accepted Answer

A)  divorced from payment,so there is great incentive to work. 
B)  divorced from payment,so there is little incentive to work. 
C)  rewarded with payment,so there is great incentive to work. 
D)  rewarded with payment,so there is little incentive to work. 
A)  divorced from payment,so there is great incentive to work. 
B)  divorced from payment,so there is little incentive to work. 
C)  rewarded with payment,so there is great incentive to work. 
D)  rewarded with payment,so there is little incentive to work.

One of the best explanations for why some countries are rich and others are poor is that:

List the institutions that are important for economic growth as discussed in this chapter.

Countries that use markets to organize production tend to have higher growth rates.

When an economic system changes from using a collective property rights system to something closer to private property rights,the immediate effect is:

A legal system that helps raise a nation's productivity is one that:

Landlocked countries tend to grow faster than countries that have access to water.

Use the following to answer questions Figure: Economic Growth in Major World Regions -(Figure: Economic Growth in Major World Regions)Refer to the figure,which shows real GDP per capita over time in different regions of the world.The chart shows that:

Incentives are important in structuring the institutions in a country.

Good institutions:

Which is NOT a factor of production?

Countries with a high GDP per capita have a lot of physical and human capital organized by means of the best technological knowledge available.

A country increases its human capital by engaging in:

Why did so many Chinese farmers and workers starve under "The Great Leap Forward"?

China's experiment with communal farming caused agricultural production to plummet and millions starved to death as a result.

For most of recorded human history,people were poor and there was no economic growth.

GDP per capita does not vary much among nations.

According to the rule of 70,a country with an annual growth rate of 7% will double its GDP per capita in:

Slow economic growth sustained over long periods produces:

Under communal property,effort is:

The Big Ideas

The Power of Trade

Supply and Demand

Equilibrium- How Supply and Demand

Price Ceilings and Floors

GDP and the Measurement of Progress

Growth,capital Accumulation

Saving,investment,and the Financial System

Stock Markets and Personal Finance

Unemployment and Labor Force Participation

Inflation and the Quantity Theory of Money

Business Fluctuations

Transmission and Amplification Mechanisms

The Federal Reserve System

Monetary Policy

The Federal Budget- Taxes and Spending

Fiscal Policy

International Trade

International Finance

Political Economy and Public Choice

Filters

Exam 7: The Wealth of Nations and Economic Growth

One of the best explanations for why some countries are rich and others are poor is that:

List the institutions that are important for economic growth as discussed in this chapter.

Countries that use markets to organize production tend to have higher growth rates.

When an economic system changes from using a collective property rights system to something closer to private property rights,the immediate effect is:

A legal system that helps raise a nation's productivity is one that:

Landlocked countries tend to grow faster than countries that have access to water.

Use the following to answer questions Figure: Economic Growth in Major World Regions -(Figure: Economic Growth in Major World Regions)Refer to the figure,which shows real GDP per capita over time in different regions of the world.The chart shows that:

Incentives are important in structuring the institutions in a country.

Good institutions:

Which is NOT a factor of production?

Countries with a high GDP per capita have a lot of physical and human capital organized by means of the best technological knowledge available.

A country increases its human capital by engaging in:

Why did so many Chinese farmers and workers starve under "The Great Leap Forward"?

China's experiment with communal farming caused agricultural production to plummet and millions starved to death as a result.

For most of recorded human history,people were poor and there was no economic growth.

GDP per capita does not vary much among nations.

According to the rule of 70,a country with an annual growth rate of 7% will double its GDP per capita in:

Slow economic growth sustained over long periods produces:

Under communal property,effort is:

The Big Ideas

The Power of Trade

Supply and Demand

Equilibrium- How Supply and Demand

Price Ceilings and Floors

GDP and the Measurement of Progress

Growth,capital Accumulation

Saving,investment,and the Financial System

Stock Markets and Personal Finance

Unemployment and Labor Force Participation

Inflation and the Quantity Theory of Money

Business Fluctuations

Transmission and Amplification Mechanisms

The Federal Reserve System

Monetary Policy

The Federal Budget- Taxes and Spending

Fiscal Policy

International Trade

International Finance

Political Economy and Public Choice

Filters