Question 1

Openness to international trade tends to hinder growth because it allows a country's technical knowledge to be exploited by other countries.

Accepted Answer

A) True 
 B)False

Question 2

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 all regions of the world:

Accepted Answer

A)  were poor at one time. 
B)  have been relatively rich throughout most of human history. 
C)  have experienced moderate growth throughout most of human history. 
D)  remain poor today. 
A)  were poor at one time. 
B)  have been relatively rich throughout most of human history. 
C)  have experienced moderate growth throughout most of human history. 
D)  remain poor today.

Question 3

The BEST way for an economy to grow is to:

Accepted Answer

A)  seek more foreign aid for the economy. 
B)  increase the government's intervention in the economy. 
C)  change the country's institutions. 
D)  establish policies promoting communal property. 
A)  seek more foreign aid for the economy. 
B)  increase the government's intervention in the economy. 
C)  change the country's institutions. 
D)  establish policies promoting communal property.

Question 4

Technological knowledge:

Accepted Answer

A)  may continue to increase even if human capital remains relatively constant. 
B)  is bounded by the limits of human capital. 
C)  is the productive knowledge and skills that workers acquire through education and training. 
D)  has remained relatively constant over time. 
A)  may continue to increase even if human capital remains relatively constant. 
B)  is bounded by the limits of human capital. 
C)  is the productive knowledge and skills that workers acquire through education and training. 
D)  has remained relatively constant over time.

Question 5

Increases in corruption cause economic growth to:

Accepted Answer

A)  increase. 
B)  decrease. 
C)  remain unchanged. 
D)  become impossible. 
A)  increase. 
B)  decrease. 
C)  remain unchanged. 
D)  become impossible.

Question 6

Which is an ultimate cause of economic growth among countries around the world?

Accepted Answer

A)  luck 
B)  culture 
C)  geography 
D)  Luck,culture,and geography are all ultimate causes of growth. 
A)  luck 
B)  culture 
C)  geography 
D)  Luck,culture,and geography are all ultimate causes of growth.

Question 7

Institutions:

Accepted Answer

A)  are the advantages of large-scale production that reduce average cost as quantity increases. 
B)  are the rules of the game that structure economic incentives. 
C)  are the framework that allows the government to control the economy. 
D)  do not vary much from country to country. 
A)  are the advantages of large-scale production that reduce average cost as quantity increases. 
B)  are the rules of the game that structure economic incentives. 
C)  are the framework that allows the government to control the economy. 
D)  do not vary much from country to country.

Question 8

Which country was among the top 10 least-corrupt countries in the year 2000?

Accepted Answer

A)  Angola 
B)  Myanmar 
C)  Singapore 
D)  Taiwan 
A)  Angola 
B)  Myanmar 
C)  Singapore 
D)  Taiwan

Question 9

Corruption makes it profitable to be:

Accepted Answer

A)  an engineer. 
B)  an entrepreneur. 
C)  a philosopher. 
D)  a politician or bureaucrat. 
A)  an engineer. 
B)  an entrepreneur. 
C)  a philosopher. 
D)  a politician or bureaucrat.

Question 10

Increases in the level of political stability in a country tend to:

Accepted Answer

A)  increase per capita GDP. 
B)  decrease per capita GDP. 
C)  have no impact on per capita GDP. 
D)  increase per capita GDP at lower levels of stability,but decrease per capita GDP at higher levels of stability. 
A)  increase per capita GDP. 
B)  decrease per capita GDP. 
C)  have no impact on per capita GDP. 
D)  increase per capita GDP at lower levels of stability,but decrease per capita GDP at higher levels of stability.

Question 11

If a country's GDP in 1950 was $25,000 and it had a continual rate of economic growth of 2%,its GDP would reach $50,000 until the year 2000.

Accepted Answer

A) True 
 B)False

Question 12

The main reason for the influence of institutions on the wealth of nations is that good institutions:

Accepted Answer

A)  raise people's incentives to build wealth. 
B)  keep the economy in tight control of the government. 
C)  help distribute wealth more evenly among the people. 
D)  allow government to more easily convert private property into collective property. 
A)  raise people's incentives to build wealth. 
B)  keep the economy in tight control of the government. 
C)  help distribute wealth more evenly among the people. 
D)  allow government to more easily convert private property into collective property.

Question 13

Geography,history,and luck can be considered ultimate causes of economic growth.

Accepted Answer

A) True 
 B)False

Question 14

Economies more open to foreign trade are more efficient in production partly because:

Accepted Answer

A)  more open economies tend to receive more foreign aid. 
B)  foreign producers are more productive than domestic producers. 
C)  economies of scale occur in larger markets. 
D)  property rights are less important in a more open economy. 
A)  more open economies tend to receive more foreign aid. 
B)  foreign producers are more productive than domestic producers. 
C)  economies of scale occur in larger markets. 
D)  property rights are less important in a more open economy.

Question 15

Human capital is the:

Accepted Answer

A)  stock of tools,including machines,structures,and equipment,used by workers to produce output. 
B)  productive knowledge and skills that workers acquire through education,training,and experience. 
C)  knowledge about how the world works that is used to produce goods and services. 
D)  same thing as the overall population. 
A)  stock of tools,including machines,structures,and equipment,used by workers to produce output. 
B)  productive knowledge and skills that workers acquire through education,training,and experience. 
C)  knowledge about how the world works that is used to produce goods and services. 
D)  same thing as the overall population.

Question 16

U.S.farms today produce _____ output using _____ land as they did in 1950.

Accepted Answer

A)  more;less 
B)  about the same;less 
C)  more;about the same amount of 
D)  about the same;about the same amount of 
A)  more;less 
B)  about the same;less 
C)  more;about the same amount of 
D)  about the same;about the same amount of

Question 17

Roughly what percent of the world's population live in countries with per capita GDP lower than the average world per capita GDP?

Accepted Answer

A)  80% 
B)  50% 
C)  25% 
D)  10% 
A)  80% 
B)  50% 
C)  25% 
D)  10%

Question 18

Farmers who use tractors instead of horse-drawn plows have greater yields.Which factor of production explains this result?

Accepted Answer

A)  organizational skills 
B)  natural resources 
C)  technical knowledge 
D)  physical capital 
A)  organizational skills 
B)  natural resources 
C)  technical knowledge 
D)  physical capital

Question 19

A country that grows at an average rate of 7% will double its living standard every 10 years.

Accepted Answer

A) True 
 B)False

Question 20

The rule of 70 implies that poor countries tend to catch up with rich countries over time.

Accepted Answer

A) True 
 B)False

Exam 7: The Wealth of Nations and Economic Growth

Openness to international trade tends to hinder growth because it allows a country's technical knowledge to be exploited by other countries.

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 all regions of the world:

The BEST way for an economy to grow is to:

Technological knowledge:

Increases in corruption cause economic growth to:

Which is an ultimate cause of economic growth among countries around the world?

Institutions:

Which country was among the top 10 least-corrupt countries in the year 2000?

Corruption makes it profitable to be:

Increases in the level of political stability in a country tend to:

If a country's GDP in 1950 was $25,000 and it had a continual rate of economic growth of 2%,its GDP would reach $50,000 until the year 2000.

The main reason for the influence of institutions on the wealth of nations is that good institutions:

Geography,history,and luck can be considered ultimate causes of economic growth.

Economies more open to foreign trade are more efficient in production partly because:

Human capital is the:

U.S.farms today produce _____ output using _____ land as they did in 1950.

Roughly what percent of the world's population live in countries with per capita GDP lower than the average world per capita GDP?

Farmers who use tractors instead of horse-drawn plows have greater yields.Which factor of production explains this result?

A country that grows at an average rate of 7% will double its living standard every 10 years.

The rule of 70 implies that poor countries tend to catch up with rich countries over time.

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

U.S.farms today produce _ output using _ land as they did in 1950.