Question 1

A country will roughly double its GDP in twenty years if its annual growth rate is:

Accepted Answer

A) ​2.5 percent. 
B) ​3.5 percent. 
C) ​7.5 percent. 
D) ​12 percent. 
A) ​2.5 percent. 
B) ​3.5 percent. 
C) ​7.5 percent. 
D) ​12 percent.

Question 2

Output per capita will tend to increase if the labor force participation rate in a country ____ or if workers put in ____ hours.

Accepted Answer

A) ​rises; longer. 
B) ​rises, shorter. 
C) ​falls; longer. 
D) ​falls; shorter 
A) ​rises; longer. 
B) ​rises, shorter. 
C) ​falls; longer. 
D) ​falls; shorter

Question 3

In the nearly 200 years since Malthus wrote An Essay on the Principle of Population, what has happened to population growth rates as nations have become increasingly industrialized?

Accepted Answer

A) ​they have generally increased 
B) ​they have averaged zero 
C) ​they have generally fallen 
D) ​they have done exactly as Malthus forecast, outstripping the production of output 
A) ​they have generally increased 
B) ​they have averaged zero 
C) ​they have generally fallen 
D) ​they have done exactly as Malthus forecast, outstripping the production of output

Question 4

Allowing free trade can lead to greater output because of the principle of:

Accepted Answer

A) ​absolute advantage. 
B) ​rule of 70. 
C) ​comparative advantage. 
D) ​scarcity. 
A) ​absolute advantage. 
B) ​rule of 70. 
C) ​comparative advantage. 
D) ​scarcity.

Question 5

When observing economic growth and literacy rates, it is clear that:

Accepted Answer

A) ​economic growth causes higher literacy rates. 
B) ​economic growth may be a consequence of improved education. 
C) ​improved levels of education may be the result of increasing economic growth. 
D) ​all of the above are likely to be true. 
A) ​economic growth causes higher literacy rates. 
B) ​economic growth may be a consequence of improved education. 
C) ​improved levels of education may be the result of increasing economic growth. 
D) ​all of the above are likely to be true.

Question 6

Higher levels of savings will result in all of following except:

Accepted Answer

A) ​greater economic growth. 
B) ​higher capital formation. 
C) ​more consumption in the future. 
D) ​lower rates of investment. 
A) ​greater economic growth. 
B) ​higher capital formation. 
C) ​more consumption in the future. 
D) ​lower rates of investment.

Question 7

Rapid population increase in which of the following economies may threaten and deter economic growth the most?

Accepted Answer

A) ​highly industrialized countries 
B) ​an agriculture based economy 
C) ​developed economies 
D) ​a technology driven economy 
A) ​highly industrialized countries 
B) ​an agriculture based economy 
C) ​developed economies 
D) ​a technology driven economy

Question 8

Ultimately, productivity growth is the major determinant of a country's standard of living

Accepted Answer

A) True 
 B)False

Question 9

Many scholars believe that the importance of research and development is understated. Efforts in research and development can include:​

Accepted Answer

A) ​the introduction of new products. 
B) ​management improvements. 
C) ​production innovations. 
D) ​any of the above. 
A) ​the introduction of new products. 
B) ​management improvements. 
C) ​production innovations. 
D) ​any of the above.

Question 10

Which of the following factors contribute to economic growth?

Accepted Answer

A) ​the construction of new factories 
B) ​an increase in the proportion of the population that is college-educated 
C) ​a decrease in the productivity of labor 
D) ​only (a) and (b). 
A) ​the construction of new factories 
B) ​an increase in the proportion of the population that is college-educated 
C) ​a decrease in the productivity of labor 
D) ​only (a) and (b).

Question 11

The higher opportunity cost of obtaining an education in developing countries is one of the reasons that school enrollments are lower.

Accepted Answer

A) True 
 B)False

Question 12

Generally there is an inverse relationship between the level of savings and the level of long-term economic growth.

Accepted Answer

A) True 
 B)False

Question 13

The prosperity of a nation today is typically measured by its:

Accepted Answer

A) ​total output or gross national product. 
B) ​real output per capita. 
C) ​gold reserves. 
D) ​proportionate share of international trade. 
A) ​total output or gross national product. 
B) ​real output per capita. 
C) ​gold reserves. 
D) ​proportionate share of international trade.

Question 14

Is it possible to have economic growth with no opportunity cost?

Accepted Answer

A) ​Yes, economic growth requires no current sacrifices-only the passage of time. 
B) ​No, but economic growth is always worth whatever sacrifice is required. 
C) ​No, because growth depletes the stock of knowledge so that more growth today means less growth tomorrow. 
D) ​No, because growth requires the sacrifice of consumption goods in order to invest in such things as capital formation and research and development. 
A) ​Yes, economic growth requires no current sacrifices-only the passage of time. 
B) ​No, but economic growth is always worth whatever sacrifice is required. 
C) ​No, because growth depletes the stock of knowledge so that more growth today means less growth tomorrow. 
D) ​No, because growth requires the sacrifice of consumption goods in order to invest in such things as capital formation and research and development.

Question 15

If there was both an increase in technology and an increase in labor force participation, real GDP growth would ____ and real GDP growth per capita would ____.

Accepted Answer

A) ​increase: increase 
B) ​be indeterminate; be indeterminate 
C) ​be indeterminate; decrease 
D) ​increase; be indeterminate 
A) ​increase: increase 
B) ​be indeterminate; be indeterminate 
C) ​be indeterminate; decrease 
D) ​increase; be indeterminate

Question 16

Most modern economists agree that there is a single factor that can be used to explain economic growth.

Accepted Answer

A) ​This is a true statement because what are needed are abundant resources. 
B) ​This is a true statement because at the foundation of economic growth, it is essential that there exist extensive private property rights. 
C) ​This is a false statement because nearly all economists believe that economic growth is a complex process without a single dominant factor. 
D) ​This is a false statement because economists typically do not agree on policy issues. 
A) ​This is a true statement because what are needed are abundant resources. 
B) ​This is a true statement because at the foundation of economic growth, it is essential that there exist extensive private property rights. 
C) ​This is a false statement because nearly all economists believe that economic growth is a complex process without a single dominant factor. 
D) ​This is a false statement because economists typically do not agree on policy issues.

Question 17

A nation can achieve higher economic growth if:

Accepted Answer

A) ​it devotes more resources to research and development. 
B) ​the productivity of labor declines. 
C) ​taxes are imposed on investment in capital. 
D) ​more resources are allocated to consumption goods. 
A) ​it devotes more resources to research and development. 
B) ​the productivity of labor declines. 
C) ​taxes are imposed on investment in capital. 
D) ​more resources are allocated to consumption goods.

Question 18

Which of the following countries is lacking an abundance of natural resources?

Accepted Answer

A) ​Australia 
B) ​Japan 
C) ​Brazil 
D) ​United States 
A) ​Australia 
B) ​Japan 
C) ​Brazil 
D) ​United States

Question 19

Economists generally define economic growth as an increase in real income per capita.

Accepted Answer

A) True 
 B)False

Question 20

The Malthusian prospect of starvation of the population could be prevented by:

Accepted Answer

A) ​increasing the amount of land available for agriculture. 
B) ​investing in research and development of new technologies. 
C) ​expanding food production on available land. 
D) ​all of the above 
A) ​increasing the amount of land available for agriculture. 
B) ​investing in research and development of new technologies. 
C) ​expanding food production on available land. 
D) ​all of the above

Exam 12: Firms in Perfectly Competitive Markets

A country will roughly double its GDP in twenty years if its annual growth rate is:

Output per capita will tend to increase if the labor force participation rate in a country ____ or if workers put in ____ hours.

In the nearly 200 years since Malthus wrote An Essay on the Principle of Population, what has happened to population growth rates as nations have become increasingly industrialized?

Allowing free trade can lead to greater output because of the principle of:

When observing economic growth and literacy rates, it is clear that:

Higher levels of savings will result in all of following except:

Rapid population increase in which of the following economies may threaten and deter economic growth the most?

Ultimately, productivity growth is the major determinant of a country's standard of living

Many scholars believe that the importance of research and development is understated. Efforts in research and development can include:​

Which of the following factors contribute to economic growth?

The higher opportunity cost of obtaining an education in developing countries is one of the reasons that school enrollments are lower.

Generally there is an inverse relationship between the level of savings and the level of long-term economic growth.

The prosperity of a nation today is typically measured by its:

Is it possible to have economic growth with no opportunity cost?

If there was both an increase in technology and an increase in labor force participation, real GDP growth would ____ and real GDP growth per capita would ____.

Most modern economists agree that there is a single factor that can be used to explain economic growth.

A nation can achieve higher economic growth if:

Which of the following countries is lacking an abundance of natural resources?

Economists generally define economic growth as an increase in real income per capita.

The Malthusian prospect of starvation of the population could be prevented by:

The Role and Method of Economics

Eight Powerful Ideas

Scarcity, Trade-Offs, and Production Possibilities

Demand, Supply, and Market Equilibrium

Market in Motion and Price Controls

Elasticities

Market Efficiency and Welfare

Market Failure

Public Finance and Public Choice

Consumer Choice Theory

The Firm: Production and Costs

Monopoly and Antitrust

Monopolistic Competition and Product Differentiation

Oligopoly and Strategic Behavior

The Markets for Labor, Capital, and Land

Income, Poverty and Health Care

Introduction to Macroeconomics: Unemployment, Inflation, and Economic Fluctuations

Measuring Economic Performance

Economic Growth in the Global Economy

Financial Markets, Saving, and Investment

Filters

Output per capita will tend to increase if the labor force participation rate in a country or if workers put in hours.

Many scholars believe that the importance of research and development is understated. Efforts in research and development can include:

If there was both an increase in technology and an increase in labor force participation, real GDP growth would and real GDP growth per capita would .