Question 1

Which of the following will tend to cause an increase in technology?

Accepted Answer

A)  an increase in research and development expenditures 
B)  the development of new ideas 
C)  increases in human capital 
D)  all of the above 
A)  an increase in research and development expenditures 
B)  the development of new ideas 
C)  increases in human capital 
D)  all of the above

Question 2

Which of the following factors would economists consider "key" to economic development?

Accepted Answer

A)  expansionary monetary policy 
B)  establishing a system of property rights 
C)  policies that promote consumption expenditures by households 
D)  All of the above are correct. 
A)  expansionary monetary policy 
B)  establishing a system of property rights 
C)  policies that promote consumption expenditures by households 
D)  All of the above are correct.

Question 3

Economists have determined that there are four factors that seem to strongly affect a nation's rate of economic development. Which is NOT one of these four factors?

Accepted Answer

A)  establishing a system of property rights 
B)  developing an educated population 
C)  supporting current industries and the jobs they provide instead of adopting new technology that brings disruptive social changes 
D)  limiting the extent to which the government imposes trade barriers 
A)  establishing a system of property rights 
B)  developing an educated population 
C)  supporting current industries and the jobs they provide instead of adopting new technology that brings disruptive social changes 
D)  limiting the extent to which the government imposes trade barriers

Question 4

Saving is important for economic growth because

Accepted Answer

A)  a higher saving rate reduces investment spending. 
B)  a higher saving rate increases investment spending. 
C)  more saving increases consumption immediately. 
D)  a higher saving rate will decrease the standard of living in the future. 
A)  a higher saving rate reduces investment spending. 
B)  a higher saving rate increases investment spending. 
C)  more saving increases consumption immediately. 
D)  a higher saving rate will decrease the standard of living in the future.

Question 5

Of the following, which best explains why Thomas Malthus was incorrect in his prediction that population would outstrip food supplies?

Accepted Answer

A)  Malthus failed to realize that that human population would increase considerably. 
B)  Malthus failed to recognize that economic growth is accompanied by smaller family sizes. 
C)  Malthus incorrectly believed that economic growth would reduce birthrates. 
D)  Malthus incorrectly predicted that modernization would increase the demand for children. 
A)  Malthus failed to realize that that human population would increase considerably. 
B)  Malthus failed to recognize that economic growth is accompanied by smaller family sizes. 
C)  Malthus incorrectly believed that economic growth would reduce birthrates. 
D)  Malthus incorrectly predicted that modernization would increase the demand for children.

Question 6

Which of the following factors will NOT increase economic development?

Accepted Answer

A)  increasing the amount of education in the population 
B)  establishing a system of property rights 
C)  creative destruction where old jobs, companies and industries are destroyed 
D)  increasing the amount of protectionism 
A)  increasing the amount of education in the population 
B)  establishing a system of property rights 
C)  creative destruction where old jobs, companies and industries are destroyed 
D)  increasing the amount of protectionism

Question 7

Labor productivity is computed as

Accepted Answer

A)  per capita real GDP divided by the number of workers. 
B)  real GDP divided by population. 
C)  per capita real GDP divided by population. 
D)  real GDP divided by the number of workers. 
A)  per capita real GDP divided by the number of workers. 
B)  real GDP divided by population. 
C)  per capita real GDP divided by population. 
D)  real GDP divided by the number of workers.

Question 8

If all income is consumed in a year, then

Accepted Answer

A)  investment spending will increase. 
B)  income next year will increase. 
C)  investment spending will be zero. 
D)  any investment spending will be done by the government. 
A)  investment spending will increase. 
B)  income next year will increase. 
C)  investment spending will be zero. 
D)  any investment spending will be done by the government.

Question 9

Innovation typically increases when

Accepted Answer

A)  market incentives and private property rights are encouraged. 
B)  government controls the resource base. 
C)  high taxes are present. 
D)  the legal system is weak. 
A)  market incentives and private property rights are encouraged. 
B)  government controls the resource base. 
C)  high taxes are present. 
D)  the legal system is weak.

Question 10

Free trade is viewed as key to economic development because

Accepted Answer

A)  it encourages a faster spread of technology. 
B)  it encourages a country's exports only. 
C)  it brings in expensive new technology. 
D)  none of the above is correct. 
A)  it encourages a faster spread of technology. 
B)  it encourages a country's exports only. 
C)  it brings in expensive new technology. 
D)  none of the above is correct.

Question 11

An increase in growth rates will cause the production possibilities curve to

Accepted Answer

A)  shift inward. 
B)  become steeper. 
C)  become flatter. 
D)  shift outward. 
A)  shift inward. 
B)  become steeper. 
C)  become flatter. 
D)  shift outward.

Question 12

Which one of the following is TRUE?

Accepted Answer

A)  As a country becomes more prosperous, it experiences a higher birth rate. 
B)  Over the past century, the supply of food has grown more quickly than has the demand for food. 
C)  Over the past century, the real price of food has risen, reflecting the pressure of population growth on food supplies. 
D)  Over the next half-century, it is expected that population growth in industrially advanced nations will outpace population growth in developing countries. 
A)  As a country becomes more prosperous, it experiences a higher birth rate. 
B)  Over the past century, the supply of food has grown more quickly than has the demand for food. 
C)  Over the past century, the real price of food has risen, reflecting the pressure of population growth on food supplies. 
D)  Over the next half-century, it is expected that population growth in industrially advanced nations will outpace population growth in developing countries.

Question 13

In order to be able to consume more in the future, you have to consume

Accepted Answer

A)  less today and save the difference. 
B)  more today to increase supply. 
C)  more consumer goods. 
D)  fewer capital goods. 
A)  less today and save the difference. 
B)  more today to increase supply. 
C)  more consumer goods. 
D)  fewer capital goods.

Question 14

Labor productivity can best be calculated as

Accepted Answer

A)  real Gross Domestic Product (GDP) / Gross Domestic Product (GDP) price index. 
B)  real Gross Domestic Product (GDP) / number of workers. 
C)  number of workers / hours of work. 
D)  real wages / hours of work. 
A)  real Gross Domestic Product (GDP) / Gross Domestic Product (GDP) price index. 
B)  real Gross Domestic Product (GDP) / number of workers. 
C)  number of workers / hours of work. 
D)  real wages / hours of work.

Question 15

Human capital is

Accepted Answer

A)  the saving done by human beings. 
B)  the knowledge and skills that people in the work force acquire through education and training. 
C)  a measure of the labor productivity of workers. 
D)  the investment people make in industries that make capital goods. 
A)  the saving done by human beings. 
B)  the knowledge and skills that people in the work force acquire through education and training. 
C)  a measure of the labor productivity of workers. 
D)  the investment people make in industries that make capital goods.

Question 16

A system of private property rights

Accepted Answer

A)  enhances economic growth by creating incentives for the government to sell its assets. 
B)  enhances economic growth by inducing people to make capital investments today. 
C)  retards economic growth by serving the interests of the wealthy only. 
D)  retards economic growth by limiting the options of people who own nothing. 
A)  enhances economic growth by creating incentives for the government to sell its assets. 
B)  enhances economic growth by inducing people to make capital investments today. 
C)  retards economic growth by serving the interests of the wealthy only. 
D)  retards economic growth by limiting the options of people who own nothing.

Question 17

A long period of very little or no economic growth is commonly known as

Accepted Answer

A)  economic recession. 
B)  a business cycle. 
C)  deflation. 
D)  secular stagnation. 
A)  economic recession. 
B)  a business cycle. 
C)  deflation. 
D)  secular stagnation.

Question 18

A patent is a government protection that gives

Accepted Answer

A)  consumers the right to sue when products are unsafe. 
B)  inventors exclusive rights to their product for a time. 
C)  monopolies the right to be sole producers due to economies of scale. 
D)  companies the right to produce any good they choose. 
A)  consumers the right to sue when products are unsafe. 
B)  inventors exclusive rights to their product for a time. 
C)  monopolies the right to be sole producers due to economies of scale. 
D)  companies the right to produce any good they choose.

Question 19

An important factor in determining a country's rate of economic growth is

Accepted Answer

A)  the diversity of its population. 
B)  its rate of saving. 
C)  the size of its labor force. 
D)  the proportion of the adult population that is working. 
A)  the diversity of its population. 
B)  its rate of saving. 
C)  the size of its labor force. 
D)  the proportion of the adult population that is working.

Question 20

-According to the above table, if per capita real GDP is currently $100, then at a constant annual rate of growth of 8 percent, per capita real GDP ten years from now will be equal to

Accepted Answer

A)  $200. 
B)  $214. 
C)  $216. 
D)  $259. 
A)  $200. 
B)  $214. 
C)  $216. 
D)  $259.

Exam 9: Global Economic Growth and Development

Which of the following will tend to cause an increase in technology?

Which of the following factors would economists consider "key" to economic development?

Economists have determined that there are four factors that seem to strongly affect a nation's rate of economic development. Which is NOT one of these four factors?

Saving is important for economic growth because

Of the following, which best explains why Thomas Malthus was incorrect in his prediction that population would outstrip food supplies?

Which of the following factors will NOT increase economic development?

Labor productivity is computed as

If all income is consumed in a year, then

Innovation typically increases when

Free trade is viewed as key to economic development because

An increase in growth rates will cause the production possibilities curve to

Which one of the following is TRUE?

In order to be able to consume more in the future, you have to consume

Labor productivity can best be calculated as

Human capital is

A system of private property rights

A long period of very little or no economic growth is commonly known as

A patent is a government protection that gives

An important factor in determining a country's rate of economic growth is

-According to the above table, if per capita real GDP is currently $100, then at a constant annual rate of growth of 8 percent, per capita real GDP ten years from now will be equal to

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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