Question 1

In the absence of well-defined property rights, we would likely find

Accepted Answer

A)  people with more incentives to take risks. 
B)  people with less incentives to take risks. 
C)  higher economic growth rates. 
D)  increases in investment activity. 
A)  people with more incentives to take risks. 
B)  people with less incentives to take risks. 
C)  higher economic growth rates. 
D)  increases in investment activity.

Question 2

What is the economic role of a patent?

Accepted Answer

A patent grants the inventor the exclusi

Question 3

Which of the following does free trade encourage?

Accepted Answer

A)  more rapid spread of technology 
B)  higher rates of economic growth 
C)  domestic industries' access to larger markets 
D)  all of the above 
A)  more rapid spread of technology 
B)  higher rates of economic growth 
C)  domestic industries' access to larger markets 
D)  all of the above

Question 4

The modification of manufacturing processes so as to reduce the resulting environmental damage is an endeavor that requires capital investment, labor inputs, and technology. What then follows from this statement?

Accepted Answer

A)  Economic growth can benefit the environment. 
B)  Environmental damage is a regrettable but necessary side effect of economic growth. 
C)  The condition of the environment will be better in slower-growing countries. 
D)  The way to reduce pollution is to educate people about its effects. 
A)  Economic growth can benefit the environment. 
B)  Environmental damage is a regrettable but necessary side effect of economic growth. 
C)  The condition of the environment will be better in slower-growing countries. 
D)  The way to reduce pollution is to educate people about its effects.

Question 5

If we are interested in knowing whether a poor country is improving economically, we want to know not only what the economic growth rate is, but also

Accepted Answer

A)  whether the economic growth rate is faster than other nations' growth rates. 
B)  whether government spending is growing at the same rate. 
C)  whether the economic growth rate is greater than last year's rate. 
D)  whether the lowest income groups are benefiting from the growth. 
A)  whether the economic growth rate is faster than other nations' growth rates. 
B)  whether government spending is growing at the same rate. 
C)  whether the economic growth rate is greater than last year's rate. 
D)  whether the lowest income groups are benefiting from the growth.

Question 6

Which of the following are mentioned as forces of the new growth theory that influence economic growth? I. Technology
II) New ideas
III) Innovations

Accepted Answer

A)  I only 
B)  I and II only 
C)  I and III only 
D)  II and III only 
E)  I, II, and III 
A)  I only 
B)  I and II only 
C)  I and III only 
D)  II and III only 
E)  I, II, and III

Question 7

One of the problems with the definition of economic growth is that

Accepted Answer

A)  it overstates economic growth because it does not account for leisure time. 
B)  it does not account for the distribution of income. 
C)  it overstates economic growth because it does not account for the reduction in work time. 
D)  it understates economic growth because it does not account for the reduction in work time. 
A)  it overstates economic growth because it does not account for leisure time. 
B)  it does not account for the distribution of income. 
C)  it overstates economic growth because it does not account for the reduction in work time. 
D)  it understates economic growth because it does not account for the reduction in work time.

Question 8

Labor productivity is defined as

Accepted Answer

A)  the amount of output per worker. 
B)  the amount of input per worker. 
C)  the amount of workers per unit of input. 
D)  the increase in output per unit of machinery. 
A)  the amount of output per worker. 
B)  the amount of input per worker. 
C)  the amount of workers per unit of input. 
D)  the increase in output per unit of machinery.

Question 9

The immediate effect of increased population growth, with real GDP growth unchanged, is to

Accepted Answer

A)  reduce economic growth by reducing per capita real GDP. 
B)  increase economic growth by stimulating more saving. 
C)  increase economic growth by boosting the capital stock. 
D)  leave economic growth unchanged. 
A)  reduce economic growth by reducing per capita real GDP. 
B)  increase economic growth by stimulating more saving. 
C)  increase economic growth by boosting the capital stock. 
D)  leave economic growth unchanged.

Question 10

New growth theorists believe that

Accepted Answer

A)  economic growth comes from innovation. 
B)  economic growth comes only from saving. 
C)  economic growth is due to capital spending and not research and development spending since much research and development spending fails to produce an invention. 
D)  inventions spread very rapidly, thereby curtailing the need for more innovations. 
A)  economic growth comes from innovation. 
B)  economic growth comes only from saving. 
C)  economic growth is due to capital spending and not research and development spending since much research and development spending fails to produce an invention. 
D)  inventions spread very rapidly, thereby curtailing the need for more innovations.

Question 11

Would a new growth theorist expect economic growth to be very rapid in one of the Communist nations before the fall of Communism? Why or why not?

Accepted Answer

No. These centrally planned economies di

Question 12

According to the new growth theory

Accepted Answer

A)  technology should be considered as a factor of production. 
B)  technology plays a minor role in economic development. 
C)  technology provides few rewards to the society. 
D)  technology is a natural by-product of invention. 
A)  technology should be considered as a factor of production. 
B)  technology plays a minor role in economic development. 
C)  technology provides few rewards to the society. 
D)  technology is a natural by-product of invention.

Question 13

The definition of economic growth is the annual percentage

Accepted Answer

A)  increase in the per capita real GDP. 
B)  increase in the per capita nominal GDP. 
C)  increase in the total nominal GDP. 
D)  increase in total exports. 
A)  increase in the per capita real GDP. 
B)  increase in the per capita nominal GDP. 
C)  increase in the total nominal GDP. 
D)  increase in total exports.

Question 14

The federal government awards a patent holder the exclusive right to make, use, and sell an invention for a period of

Accepted Answer

A)  20 years. 
B)  17 years. 
C)  unlimited period. 
D)  100 years. 
A)  20 years. 
B)  17 years. 
C)  unlimited period. 
D)  100 years.

Question 15

A patent is

Accepted Answer

A)  a bond issued by the government. 
B)  a bond issued by a state. 
C)  the monopoly right given to a producer/company. 
D)  an agreement between a union and management on certain labor issues. 
A)  a bond issued by the government. 
B)  a bond issued by a state. 
C)  the monopoly right given to a producer/company. 
D)  an agreement between a union and management on certain labor issues.

Question 16

Economists typically agree that the special protection given to owners of patents tends to

Accepted Answer

A)  reduce expenditures on research and development. 
B)  increase expenditures on research and development. 
C)  reduce economic growth. 
D)  reduce productivity. 
A)  reduce expenditures on research and development. 
B)  increase expenditures on research and development. 
C)  reduce economic growth. 
D)  reduce productivity.

Question 17

According to the United Nations, the largest expected growth in population for the coming decades will occur on which continent?

Accepted Answer

A)  Europe 
B)  South America 
C)  North America 
D)  Africa 
A)  Europe 
B)  South America 
C)  North America 
D)  Africa

Question 18

Other things being equal, an increase in consumption spending implies

Accepted Answer

A)  a decline in saving. 
B)  a decline in government spending. 
C)  a higher standard of living in the future. 
D)  that economic growth will soon increase. 
A)  a decline in saving. 
B)  a decline in government spending. 
C)  a higher standard of living in the future. 
D)  that economic growth will soon increase.

Question 19

Why might population growth and immigration stimulate economic growth?

Accepted Answer

Faster population growth means

Question 20

An outward shift of the production possibilities curve demonstrates

Accepted Answer

A)  a recession. 
B)  an increased rate of inflation. 
C)  economic growth. 
D)  a cyclical shock. 
A)  a recession. 
B)  an increased rate of inflation. 
C)  economic growth. 
D)  a cyclical shock.

Exam 9: Global Economic Growth and Development

In the absence of well-defined property rights, we would likely find

What is the economic role of a patent?

Which of the following does free trade encourage?

The modification of manufacturing processes so as to reduce the resulting environmental damage is an endeavor that requires capital investment, labor inputs, and technology. What then follows from this statement?

If we are interested in knowing whether a poor country is improving economically, we want to know not only what the economic growth rate is, but also

Which of the following are mentioned as forces of the new growth theory that influence economic growth? I. Technology II) New ideas III) Innovations

One of the problems with the definition of economic growth is that

Labor productivity is defined as

The immediate effect of increased population growth, with real GDP growth unchanged, is to

New growth theorists believe that

Would a new growth theorist expect economic growth to be very rapid in one of the Communist nations before the fall of Communism? Why or why not?

According to the new growth theory

The definition of economic growth is the annual percentage

The federal government awards a patent holder the exclusive right to make, use, and sell an invention for a period of

A patent is

Economists typically agree that the special protection given to owners of patents tends to

According to the United Nations, the largest expected growth in population for the coming decades will occur on which continent?

Other things being equal, an increase in consumption spending implies

Why might population growth and immigration stimulate economic growth?

An outward shift of the production possibilities curve demonstrates

The Nature of Economics

Scarcity and the World of Trade-Offs

Demand and Supply

Extensions of Demand and Supply Analysis

Public Spending and Public Choice

Funding the Public Sector

The Macroeconomy: Unemployment, Inflation, and Deflation

Measuring the Economys Performance

Real GDP and the Price Level in the Long Run

Classical and Keynesian Macro Analyses

Consumption, Real GDP, and the Multiplier

Fiscal Policy

Deficit Spending and the Public Debt

Money, Banking, and Central Banking

Domestic and International Dimensions of Monetary Policy

Stabilization in an Integrated World Economy

Policies and Prospects for Global Economic Growth

Demand and Supply Elasticity

Consumer Choice

Rents, Profits, and the Financial Environment of Business

The Firm: Cost and Output Determination

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly and Strategic Behavior

Regulation and Antitrust Policy in a Globalized Economy

The Labor Market: Demand, Supply and Outsourcing

Unions and Labor Market Monopoly Power

Income, Poverty, and Health Care

Environmental Economics

Comparative Advantage and the Open Economy

Exchange Rates and the Balance of Payments

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