Question 1

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)  free trade opens a country up to new ideas and innovation. 
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)  free trade opens a country up to new ideas and innovation. 
D)  property rights are less important in a more open economy.

Question 2

A rural village in a developing country has an economy based on agriculture.Then the government of the country provides the village with newly developed hybrid seeds that more than double the agricultural yield per acre.This story illustrates the growth of per capita GDP in the village through which factor(s)of production?

Accepted Answer

A)  physical capital 
B)  human capital 
C)  technological knowledge 
D)  both human capital and technological knowledge 
A)  physical capital 
B)  human capital 
C)  technological knowledge 
D)  both human capital and technological knowledge

Question 3

Why do more corrupt countries have lower levels of GDP per capita?

Accepted Answer

A)  Corrupt countries have no rule of law. 
B)  Corrupt countries have higher than average taxes. 
C)  Corrupt countries provide less incentive to produce and create wealth. 
D)  Corrupt countries follow the doctrine of communism. 
A)  Corrupt countries have no rule of law. 
B)  Corrupt countries have higher than average taxes. 
C)  Corrupt countries provide less incentive to produce and create wealth. 
D)  Corrupt countries follow the doctrine of communism.

Question 4

Political stability _____ economic growth.

Accepted Answer

A)  impedes 
B)  has no effect upon 
C)  fuels 
D)  has an indeterminate effect upon 
A)  impedes 
B)  has no effect upon 
C)  fuels 
D)  has an indeterminate effect upon

Question 5

In North Korea,workers are rewarded for:

Accepted Answer

A)  providing goods and services of value to consumers. 
B)  inventing new ideas for more efficient production. 
C)  investing in human and physical capital. 
D)  being loyal to the ruling Communist Party. 
A)  providing goods and services of value to consumers. 
B)  inventing new ideas for more efficient production. 
C)  investing in human and physical capital. 
D)  being loyal to the ruling Communist Party.

Question 6

Use the following to answer questions 
Figure: Economic Growth in Major World Regions  
-If real GDP per capita in the United States is currently $50,000 and grows at 2.5% per year,it will take approximately how many years to reach $200,000?

Accepted Answer

A)  28 years 
B)  56 years 
C)  84 years 
D)  112 years 
A)  28 years 
B)  56 years 
C)  84 years 
D)  112 years

Question 7

Money is not what economists typically consider capital.

Accepted Answer

A) True 
 B)False

Question 8

There is:

Accepted Answer

A)  a strong positive correlation between per capita GDP and infant survival. 
B)  a weak positive correlation between per capita GDP and infant survival. 
C)  no correlation between per capita GDP and infant survival. 
D)  a weak negative correlation between per capita GDP and infant survival. 
A)  a strong positive correlation between per capita GDP and infant survival. 
B)  a weak positive correlation between per capita GDP and infant survival. 
C)  no correlation between per capita GDP and infant survival. 
D)  a weak negative correlation between per capita GDP and infant survival.

Question 9

What factors best explain China's increased rate of growth after 1978?

Accepted Answer

The single most important reason why Chi

Question 10

Use the following to answer questions 
Figure: The Distribution of World Income  
-In the year 2011,the world's average per capita GDP was $10,515.What percent of the world's population lived in a country with per capita GDP that was below $10,515?

Accepted Answer

A)  20% 
B)  40% 
C)  50% 
D)  80% 
A)  20% 
B)  40% 
C)  50% 
D)  80%

Question 11

Which of the following is (are)NOT an institution of economic growth?

Accepted Answer

A)  property rights 
B)  honest government 
C)  labor unions 
D)  competitive and open markets 
A)  property rights 
B)  honest government 
C)  labor unions 
D)  competitive and open markets

Question 12

The "Great Leap Forward" in China was an economic miracle,doubling agricultural production in the nation.

Accepted Answer

A) True 
 B)False

Question 13

Increasing the amount of physical capital tends to _____ output per hour of workers and _____ the value of workers.

Accepted Answer

A)  increase;increase 
B)  increase;decrease 
C)  decrease;decrease 
D)  decrease;increase 
A)  increase;increase 
B)  increase;decrease 
C)  decrease;decrease 
D)  decrease;increase

Question 14

One key fact about economic growth around the world is that:

Accepted Answer

A)  most poor countries lack natural resources. 
B)  all countries used to be poor. 
C)  growth has occurred throughout human history. 
D)  the dispersion of GDP per capita has become more equal across countries over time. 
A)  most poor countries lack natural resources. 
B)  all countries used to be poor. 
C)  growth has occurred throughout human history. 
D)  the dispersion of GDP per capita has become more equal across countries over time.

Question 15

Incentives are important in determining people's willingness to invest in physical capital,human capital,and technical knowledge.

Accepted Answer

A) True 
 B)False

Question 16

Which statement is TRUE for the Great Leap Forward period in China?

Accepted Answer

A)  Technological advance was strong because of the hard work of farmers. 
B)  A lack of private property rights provided no incentive for farmers to be productive. 
C)  Communal property in agricultural land helped align farmers' self-interest with the social interest. 
D)  Collective property rights failed to improve farming productivity because of the existence of private property rights. 
A)  Technological advance was strong because of the hard work of farmers. 
B)  A lack of private property rights provided no incentive for farmers to be productive. 
C)  Communal property in agricultural land helped align farmers' self-interest with the social interest. 
D)  Collective property rights failed to improve farming productivity because of the existence of private property rights.

Question 17

Differences in growth rates across countries are attributed mostly to differences in technological knowledge.

Accepted Answer

A) True 
 B)False

Question 18

Which statement best describes the cross-country evidence on the relationship between a nation's GDP per capita and standard measures of societal well-being?

Accepted Answer

A)  GDP per capita is negatively related to measures of societal well-being. 
B)  GDP per capita is positively related to measures of societal well-being. 
C)  There is no relationship between GDP per capita and measures of societal well-being. 
D)  The relationship between GDP per capita and societal well-being is positive at times and negative at times. 
A)  GDP per capita is negatively related to measures of societal well-being. 
B)  GDP per capita is positively related to measures of societal well-being. 
C)  There is no relationship between GDP per capita and measures of societal well-being. 
D)  The relationship between GDP per capita and societal well-being is positive at times and negative at times.

Question 19

What is the most immediate (or direct)cause of growth in real GDP per capita?

Accepted Answer

A)  factors of production 
B)  institutions 
C)  the political system in the economy 
D)  incentives 
A)  factors of production 
B)  institutions 
C)  the political system in the economy 
D)  incentives

Question 20

A country's institutions can ultimately be shaped by its history,culture,geography,and even luck.

Accepted Answer

A) True 
 B)False

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

Why do more corrupt countries have lower levels of GDP per capita?

Political stability _____ economic growth.

In North Korea,workers are rewarded for:

Use the following to answer questions Figure: Economic Growth in Major World Regions -If real GDP per capita in the United States is currently $50,000 and grows at 2.5% per year,it will take approximately how many years to reach $200,000?

Money is not what economists typically consider capital.

There is:

What factors best explain China's increased rate of growth after 1978?

Use the following to answer questions Figure: The Distribution of World Income -In the year 2011,the world's average per capita GDP was $10,515.What percent of the world's population lived in a country with per capita GDP that was below $10,515?

Which of the following is (are)NOT an institution of economic growth?

The "Great Leap Forward" in China was an economic miracle,doubling agricultural production in the nation.

Increasing the amount of physical capital tends to _ output per hour of workers and _ the value of workers.

One key fact about economic growth around the world is that:

Incentives are important in determining people's willingness to invest in physical capital,human capital,and technical knowledge.

Which statement is TRUE for the Great Leap Forward period in China?

Differences in growth rates across countries are attributed mostly to differences in technological knowledge.

Which statement best describes the cross-country evidence on the relationship between a nation's GDP per capita and standard measures of societal well-being?

What is the most immediate (or direct)cause of growth in real GDP per capita?

A country's institutions can ultimately be shaped by its history,culture,geography,and even luck.

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

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

Why do more corrupt countries have lower levels of GDP per capita?

Political stability _____ economic growth.

In North Korea,workers are rewarded for:

Use the following to answer questions Figure: Economic Growth in Major World Regions -If real GDP per capita in the United States is currently $50,000 and grows at 2.5% per year,it will take approximately how many years to reach $200,000?

Money is not what economists typically consider capital.

There is:

What factors best explain China's increased rate of growth after 1978?

Use the following to answer questions Figure: The Distribution of World Income -In the year 2011,the world's average per capita GDP was $10,515.What percent of the world's population lived in a country with per capita GDP that was below $10,515?

Which of the following is (are)NOT an institution of economic growth?

The "Great Leap Forward" in China was an economic miracle,doubling agricultural production in the nation.

Increasing the amount of physical capital tends to _____ output per hour of workers and _____ the value of workers.

One key fact about economic growth around the world is that:

Incentives are important in determining people's willingness to invest in physical capital,human capital,and technical knowledge.

Which statement is TRUE for the Great Leap Forward period in China?

Differences in growth rates across countries are attributed mostly to differences in technological knowledge.

Which statement best describes the cross-country evidence on the relationship between a nation's GDP per capita and standard measures of societal well-being?

What is the most immediate (or direct)cause of growth in real GDP per capita?

A country's institutions can ultimately be shaped by its history,culture,geography,and even luck.

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

Increasing the amount of physical capital tends to _ output per hour of workers and _ the value of workers.