Question 1

If an American-based firm opens and operates a factory in China, then it is engaging in

Accepted Answer

A)  foreign portfolio investment. 
B)  foreign financial investment. 
C)  foreign direct investment. 
D)  indirect foreign investment. 
A)  foreign portfolio investment. 
B)  foreign financial investment. 
C)  foreign direct investment. 
D)  indirect foreign investment.

Question 2

Susan and Calvin paint houses. Susan consistently paints about 400 square feet of a house's exterior per hour, while Calvin consistently paints about 300 square feet per hour. Susan's exceeds that of Calvin.

Accepted Answer

The answer of Susan and Calvin paint houses. Susan consistently...

Question 3

If over a short time a large number of teenagers become old enough to find employment and a much smaller number of people retire, then productivity

Accepted Answer

A)  and real GDP per person rise. 
B)  rises but real GDP per person falls. 
C)  falls but real GDP per person rises. 
D)  and real GDP per person fall. 
A)  and real GDP per person rise. 
B)  rises but real GDP per person falls. 
C)  falls but real GDP per person rises. 
D)  and real GDP per person fall.

Question 4

Table 25-1.
Athens and Troy both produce only ribs and baked potatoes.
  
-Refer to Table 25-1. Which of the following is correct?

Accepted Answer

A)  Both productivity and the standard of living are higher in Athens than Troy. 
B)  Productivity is higher in Athens while the standard of living is higher in Troy 
C)  Productivity is higher in Troy while the standard of living is higher in Athens. 
D)  Both productivity and the standard of living are higher in Troy than Athens. 
A)  Both productivity and the standard of living are higher in Athens than Troy. 
B)  Productivity is higher in Athens while the standard of living is higher in Troy 
C)  Productivity is higher in Troy while the standard of living is higher in Athens. 
D)  Both productivity and the standard of living are higher in Troy than Athens.

Question 5

What is the relationship between education and human capital?

Accepted Answer

Education

Question 6

Proprietary technology is technology

Accepted Answer

A)  that the government prohibits firms from using. 
B)  conserves natural resources. 
C)  that is useful while other types of technology are outdated. 
D)  that is known or controlled only by the company that discovered it. 
A)  that the government prohibits firms from using. 
B)  conserves natural resources. 
C)  that is useful while other types of technology are outdated. 
D)  that is known or controlled only by the company that discovered it.

Question 7

Upland has a population of 15,000, of whom 9,000 work 8 hours a day to produce real output of $342,000. Lowland has a population of 8,000, of whom 7,000 work 7 hours a day to produce real output of $171,500.

Accepted Answer

A)  Upland has higher productivity and higher real GDP per person than Lowland. 
B)  Upland has higher productivity but lower real GDP per person than Lowland. 
C)  Upland has lower productivity but higher real GDP per person than Lowland. 
D)  Upland has lower productivity and lower real GDP per person than Lowland. 
A)  Upland has higher productivity and higher real GDP per person than Lowland. 
B)  Upland has higher productivity but lower real GDP per person than Lowland. 
C)  Upland has lower productivity but higher real GDP per person than Lowland. 
D)  Upland has lower productivity and lower real GDP per person than Lowland.

Question 8

Your company discovers a better way to produce mousetraps, but your better methods are not apparent from the mousetraps themselves. Your knowledge of how to more efficiently produce mousetraps is

Accepted Answer

A)  common technological knowledge. 
B)  common, but not technological, knowledge. 
C)  proprietary technological knowledge. 
D)  proprietary, but not technological, knowledge. 
A)  common technological knowledge. 
B)  common, but not technological, knowledge. 
C)  proprietary technological knowledge. 
D)  proprietary, but not technological, knowledge.

Question 9

The slope of the production function with capital per worker on the horizontal axis and output per worker on the vertical axis

Accepted Answer

A)  is positive and gets steeper as capital per worker rises. 
B)  is positive and gets flatter as capital per worker rises. 
C)  is negative and gets steeper as capital per worker rises. 
D)  is negative and gets flatter as capital per worker rises. 
A)  is positive and gets steeper as capital per worker rises. 
B)  is positive and gets flatter as capital per worker rises. 
C)  is negative and gets steeper as capital per worker rises. 
D)  is negative and gets flatter as capital per worker rises.

Question 10

Suppose that a country increased its saving rate. In the long run it would have

Accepted Answer

A)  higher productivity, and another unit of capital would increase output by more than before. 
B)  higher productivity, but another unit of capital would increase output by less than before. 
C)  lower productivity, and another unit of capital would increase output by more than before. 
D)  lower productivity, but another unit of capital would increase output by less than before. 
A)  higher productivity, and another unit of capital would increase output by more than before. 
B)  higher productivity, but another unit of capital would increase output by less than before. 
C)  lower productivity, and another unit of capital would increase output by more than before. 
D)  lower productivity, but another unit of capital would increase output by less than before.

Question 11

If a country increases its saving rate, which of the following permanently grow at a higher rate?

Accepted Answer

A)  productivity and real GDP per person 
B)  productivity but not real GDP per person 
C)  real GDP per person but not productivity 
D)  neither real GDP per person nor productivity 
A)  productivity and real GDP per person 
B)  productivity but not real GDP per person 
C)  real GDP per person but not productivity 
D)  neither real GDP per person nor productivity

Question 12

Which of the following is indicated by the data on real income per person for various countries over the past 100 or so years?

Accepted Answer

A)  If, in a relatively poor country, real income per person had grown by 3.5 percent per year for the last 100 years, it would be a relatively rich country today. 
B)  Rich countries became richer and poor countries became poorer. 
C)  In the United States, real income per person today is about four times as high as it was 120 years ago. 
D)  All of the above are correct. 
A)  If, in a relatively poor country, real income per person had grown by 3.5 percent per year for the last 100 years, it would be a relatively rich country today. 
B)  Rich countries became richer and poor countries became poorer. 
C)  In the United States, real income per person today is about four times as high as it was 120 years ago. 
D)  All of the above are correct.

Question 13

You sell cupcakes. One day you double the time you spend and double all your inputs, and make twice as many cupcakes. Your cupcake production function has

Accepted Answer

A)  decreasing returns to scale. 
B)  zero returns to scale. 
C)  constant returns to scale. 
D)  increasing returns to scale. 
A)  decreasing returns to scale. 
B)  zero returns to scale. 
C)  constant returns to scale. 
D)  increasing returns to scale.

Question 14

In 2010, the imaginary nation of Bovina had a population of 5,000 and real GDP of 600,000. In 2011 it had a population of 5,200 and real GDP of 636,480. During 2011 real GDP per person in Bovina grew by

Accepted Answer

A)  2 percent, which is high compared to average U.S. growth over the last one-hundred years. 
B)  2 percent, which is about the same as average U.S. growth over the last one-hundred years. 
C)  4 percent, which is high compared to average U.S. growth over the last one-hundred years. 
D)  4 percent, which is about the same as average U.S. growth over the last one-hundred years. 
A)  2 percent, which is high compared to average U.S. growth over the last one-hundred years. 
B)  2 percent, which is about the same as average U.S. growth over the last one-hundred years. 
C)  4 percent, which is high compared to average U.S. growth over the last one-hundred years. 
D)  4 percent, which is about the same as average U.S. growth over the last one-hundred years.

Question 15

Which of the following can explain faster growth of real GDP in country A than in Country B?

Accepted Answer

A)  both greater population growth and greater productivity growth in Country A 
B)  greater population growth in Country A, but not greater productivity growth in Country A 
C)  greater productivity growth in Country A, but not greater population growth in Country A 
D)  neither greater population growth nor greater productivity growth in Country A 
A)  both greater population growth and greater productivity growth in Country A 
B)  greater population growth in Country A, but not greater productivity growth in Country A 
C)  greater productivity growth in Country A, but not greater population growth in Country A 
D)  neither greater population growth nor greater productivity growth in Country A

Question 16

Studies confirm that controlling for other variables such as the percentage of GDP devoted to investment, poor countries tend to grow at a faster rate than rich countries.

Accepted Answer

A) True 
 B)False

Question 17

If there are diminishing returns to capital, then

Accepted Answer

A)  capital produces fewer goods as it ages. 
B)  old ideas are not as useful as new ones. 
C)  increases in the capital stock eventually decrease output. 
D)  increases in the capital stock increase output by ever smaller amounts. 
A)  capital produces fewer goods as it ages. 
B)  old ideas are not as useful as new ones. 
C)  increases in the capital stock eventually decrease output. 
D)  increases in the capital stock increase output by ever smaller amounts.

Question 18

Country A and country B both increase their capital stock by one unit. Output in country A increases by 12 while output in country B increases by 15. Other things the same, diminishing returns implies that country A is

Accepted Answer

A)  richer than Country B. If Country A adds another unit of capital, output will increase by more than 12 units. 
B)  richer than Country B. If Country A adds another unit of capital, output will increase by less than 12 units. 
C)  poorer than Country B. If Country A adds another unit of capital, output will increase by more than 12 units. 
D)  poorer than Country B. If Country A adds another unit of capital, output will increase by less than 12 units. 
A)  richer than Country B. If Country A adds another unit of capital, output will increase by more than 12 units. 
B)  richer than Country B. If Country A adds another unit of capital, output will increase by less than 12 units. 
C)  poorer than Country B. If Country A adds another unit of capital, output will increase by more than 12 units. 
D)  poorer than Country B. If Country A adds another unit of capital, output will increase by less than 12 units.

Question 19

The traditional view of the production process is that capital is subject to

Accepted Answer

A)  diminishing returns, so that other things the same, real GDP in poor countries should grow at a faster rate than in rich countries. 
B)  diminishing returns, so that other things the same, real GDP in poor countries should grow at a slower rate than in rich countries. 
C)  increasing returns, so that other things the same, real GDP in poor countries should grow at a faster rate than in rich countries. 
D)  increasing returns, so that other things the same, real GDP in poor countries should grow at a slower rate than in rich countries. 
A)  diminishing returns, so that other things the same, real GDP in poor countries should grow at a faster rate than in rich countries. 
B)  diminishing returns, so that other things the same, real GDP in poor countries should grow at a slower rate than in rich countries. 
C)  increasing returns, so that other things the same, real GDP in poor countries should grow at a faster rate than in rich countries. 
D)  increasing returns, so that other things the same, real GDP in poor countries should grow at a slower rate than in rich countries.

Question 20

Both the standard of living and the growth of real GDP per person vary widely across countries.

Accepted Answer

A) True 
 B)False

If an American-based firm opens and operates a factory in China, then it is engaging in

Susan and Calvin paint houses. Susan consistently paints about 400 square feet of a house's exterior per hour, while Calvin consistently paints about 300 square feet per hour. Susan's exceeds that of Calvin.

If over a short time a large number of teenagers become old enough to find employment and a much smaller number of people retire, then productivity

Table 25-1. Athens and Troy both produce only ribs and baked potatoes. -Refer to Table 25-1. Which of the following is correct?

What is the relationship between education and human capital?

Proprietary technology is technology

Upland has a population of 15,000, of whom 9,000 work 8 hours a day to produce real output of $342,000. Lowland has a population of 8,000, of whom 7,000 work 7 hours a day to produce real output of $171,500.

Your company discovers a better way to produce mousetraps, but your better methods are not apparent from the mousetraps themselves. Your knowledge of how to more efficiently produce mousetraps is

The slope of the production function with capital per worker on the horizontal axis and output per worker on the vertical axis

Suppose that a country increased its saving rate. In the long run it would have

If a country increases its saving rate, which of the following permanently grow at a higher rate?

Which of the following is indicated by the data on real income per person for various countries over the past 100 or so years?

You sell cupcakes. One day you double the time you spend and double all your inputs, and make twice as many cupcakes. Your cupcake production function has

In 2010, the imaginary nation of Bovina had a population of 5,000 and real GDP of 600,000. In 2011 it had a population of 5,200 and real GDP of 636,480. During 2011 real GDP per person in Bovina grew by

Which of the following can explain faster growth of real GDP in country A than in Country B?

Studies confirm that controlling for other variables such as the percentage of GDP devoted to investment, poor countries tend to grow at a faster rate than rich countries.

If there are diminishing returns to capital, then

Country A and country B both increase their capital stock by one unit. Output in country A increases by 12 while output in country B increases by 15. Other things the same, diminishing returns implies that country A is

The traditional view of the production process is that capital is subject to

Both the standard of living and the growth of real GDP per person vary widely across countries.

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Measuring a Nations Income

Measuring the Cost of Living

Saving, Investment, and the Financial System

The Basic Tools of Finance

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

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Exam 7: Production and Growth

If an American-based firm opens and operates a factory in China, then it is engaging in

Susan and Calvin paint houses. Susan consistently paints about 400 square feet of a house's exterior per hour, while Calvin consistently paints about 300 square feet per hour. Susan's exceeds that of Calvin.

If over a short time a large number of teenagers become old enough to find employment and a much smaller number of people retire, then productivity

Table 25-1. Athens and Troy both produce only ribs and baked potatoes. -Refer to Table 25-1. Which of the following is correct?

What is the relationship between education and human capital?

Proprietary technology is technology

Upland has a population of 15,000, of whom 9,000 work 8 hours a day to produce real output of $342,000. Lowland has a population of 8,000, of whom 7,000 work 7 hours a day to produce real output of $171,500.

Your company discovers a better way to produce mousetraps, but your better methods are not apparent from the mousetraps themselves. Your knowledge of how to more efficiently produce mousetraps is

The slope of the production function with capital per worker on the horizontal axis and output per worker on the vertical axis

Suppose that a country increased its saving rate. In the long run it would have

If a country increases its saving rate, which of the following permanently grow at a higher rate?

Which of the following is indicated by the data on real income per person for various countries over the past 100 or so years?

You sell cupcakes. One day you double the time you spend and double all your inputs, and make twice as many cupcakes. Your cupcake production function has

In 2010, the imaginary nation of Bovina had a population of 5,000 and real GDP of 600,000. In 2011 it had a population of 5,200 and real GDP of 636,480. During 2011 real GDP per person in Bovina grew by

Which of the following can explain faster growth of real GDP in country A than in Country B?

Studies confirm that controlling for other variables such as the percentage of GDP devoted to investment, poor countries tend to grow at a faster rate than rich countries.

If there are diminishing returns to capital, then

Country A and country B both increase their capital stock by one unit. Output in country A increases by 12 while output in country B increases by 15. Other things the same, diminishing returns implies that country A is

The traditional view of the production process is that capital is subject to

Both the standard of living and the growth of real GDP per person vary widely across countries.

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Measuring a Nations Income

Measuring the Cost of Living

Saving, Investment, and the Financial System

The Basic Tools of Finance

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

Filters