Question 1

A country's standard of living depends on its ability to produce goods and services.

Accepted Answer

A) True 
 B)False

Question 2

"Market prices give no reason to believe that natural resources are a limit to economic growth." Explain this statement.

Accepted Answer

If the world were running out of natural

Question 3

Measured in 2010 dollars, real GDP per person in the United States in 2010 was about 14 times that in

Accepted Answer

A)  China. 
B)  India. 
C)  Indonesia. 
D)  Pakistan. 
A)  China. 
B)  India. 
C)  Indonesia. 
D)  Pakistan.

Question 4

In a particular production process, if the quantities of all inputs used are increased by 60%, then the quantity of output increases by 60% as well. This means that

Accepted Answer

A)  the production process cannot be enhanced by technological advances. 
B)  no mathematical representation of the relevant production function can be formulated. 
C)  the relevant production function has the limits-to-growth property. 
D)  the relevant production function has constant-returns-to-scale. 
A)  the production process cannot be enhanced by technological advances. 
B)  no mathematical representation of the relevant production function can be formulated. 
C)  the relevant production function has the limits-to-growth property. 
D)  the relevant production function has constant-returns-to-scale.

Question 5

Which one of the factors of production originates as an output from the production process, and is subsequently used as an input into the production process?

Accepted Answer

The input

Question 6

Historical trends in the prices of most natural resources compared to prices of other goods indicate that most natural resources have become scarcer over time.

Accepted Answer

A) True 
 B)False

Question 7

Measured in 2010 dollars, real GDP per person in the United States in 2010 was about

Accepted Answer

A)  $37,000. 
B)  $47,000. 
C)  $57,000. 
D)  $67,000. 
A)  $37,000. 
B)  $47,000. 
C)  $57,000. 
D)  $67,000.

Question 8

When Americans invest in Russia, the income of Russians that is, Russian GNP) rises by more than production in Russia that is, Russian GDP).

Accepted Answer

A) True 
 B)False

Question 9

Which of the following statements is true?

Accepted Answer

A)  Productivity is calculated as hours worked divided by output produced. 
B)  Americans have a higher standard of living than Indonesians because American workers are more productive than Indonesian workers. 
C)  Both A and B are correct. 
D)  None of the above are correct. 
A)  Productivity is calculated as hours worked divided by output produced. 
B)  Americans have a higher standard of living than Indonesians because American workers are more productive than Indonesian workers. 
C)  Both A and B are correct. 
D)  None of the above are correct.

Question 10

If your firm's production function has constant returns to scale, then if you double all your inputs, your firm's output will

Accepted Answer

A)  double and productivity will rise. 
B)  double but productivity will not change. 
C)  more than double and productivity will rise. 
D)  more then double but productivity will not change. 
A)  double and productivity will rise. 
B)  double but productivity will not change. 
C)  more than double and productivity will rise. 
D)  more then double but productivity will not change.

Question 11

In 1870, the richest country in the world was

Accepted Answer

A)  Germany. 
B)  Japan 
C)  the United Kingdom. 
D)  the United States. 
A)  Germany. 
B)  Japan 
C)  the United Kingdom. 
D)  the United States.

Question 12

Which of the following lists contains, in this order, natural resources, human capital, and physical capital?

Accepted Answer

A)  For a restaurant: the land the restaurant was built on, the money it borrowed to buy supplies, the freezers where the chops and steaks are kept. 
B)  For a furniture company: wood, the skills and knowledge of its workers, saws. 
C)  For a railroad: fuel, railroad engines, railroad tracks. 
D)  None of the above is correct. 
A)  For a restaurant: the land the restaurant was built on, the money it borrowed to buy supplies, the freezers where the chops and steaks are kept. 
B)  For a furniture company: wood, the skills and knowledge of its workers, saws. 
C)  For a railroad: fuel, railroad engines, railroad tracks. 
D)  None of the above is correct.

Question 13

In the United States in 2010 real GDP per person was about $47,000, while in some poor countries real GDP per person was less than $5,000.

Accepted Answer

A) True 
 B)False

Question 14

Countries that grew the fastest over the last 100 or so years had average growth rates of real income per person of about

Accepted Answer

A)  1.5 percent per year. 
B)  2.0 percent per year. 
C)  2.5 percent per year. 
D)  3.0 percent per year. 
A)  1.5 percent per year. 
B)  2.0 percent per year. 
C)  2.5 percent per year. 
D)  3.0 percent per year.

Question 15

An increase in capital will increase real GNP per person

Accepted Answer

A)  more in a poor country than a rich country. The increase in real GNP per person will be larger if the addition to capital is from domestic rather than foreign investment. 
B)  more in a poor country than a rich country. The increase in real GNP per person will be larger if the addition to capital is foreign rather than from domestic investment. 
C)  less in a poor country than a rich country. The increase in real GNP per person will be larger if the addition to capital is from domestic rather than foreign investment. 
D)  less in a poor country than a rich country. The increase in real GNP per person will be larger if the addition to capital is foreign rather than from domestic investment. 
A)  more in a poor country than a rich country. The increase in real GNP per person will be larger if the addition to capital is from domestic rather than foreign investment. 
B)  more in a poor country than a rich country. The increase in real GNP per person will be larger if the addition to capital is foreign rather than from domestic investment. 
C)  less in a poor country than a rich country. The increase in real GNP per person will be larger if the addition to capital is from domestic rather than foreign investment. 
D)  less in a poor country than a rich country. The increase in real GNP per person will be larger if the addition to capital is foreign rather than from domestic investment.

Question 16

Consider the nations of India, Indonesia, and Japan. Over the past century, which of these three nations has experienced, by far, more rapid economic growth than the other two nations?

Accepted Answer

Japan's growth rate 2.65 perce

Question 17

"When workers acquire tools, they become more productive." This statement reflects the general fact that is a determinant of productivity.

Accepted Answer

physical c

Question 18

In the equation for the production function H/L represents

Accepted Answer

A)  natural resources per worker. 
B)  human capital per worker. 
C)  output per worker. 
D)  physical capital per worker. 
A)  natural resources per worker. 
B)  human capital per worker. 
C)  output per worker. 
D)  physical capital per worker.

Question 19

An understanding of the best ways to produce goods and services is called

Accepted Answer

A)  human capital. 
B)  physical capital. 
C)  technology. 
D)  productivity. 
A)  human capital. 
B)  physical capital. 
C)  technology. 
D)  productivity.

Question 20

Country A has twice as many workers as Country B. Country A also has twice as much physical capital, twice as much human capital, and access to twice as many natural resources as Country B. Assuming constant-returns to scale, which of the following is higher in Country A?

Accepted Answer

A)  both output per worker and productivity 
B)  output per worker but not productivity 
C)  productivity but not output per worker 
D)  neither productivity nor output per worker 
A)  both output per worker and productivity 
B)  output per worker but not productivity 
C)  productivity but not output per worker 
D)  neither productivity nor output per worker

Exam 17: Production and Growth

A country's standard of living depends on its ability to produce goods and services.

"Market prices give no reason to believe that natural resources are a limit to economic growth." Explain this statement.

Measured in 2010 dollars, real GDP per person in the United States in 2010 was about 14 times that in

In a particular production process, if the quantities of all inputs used are increased by 60%, then the quantity of output increases by 60% as well. This means that

Which one of the factors of production originates as an output from the production process, and is subsequently used as an input into the production process?

Historical trends in the prices of most natural resources compared to prices of other goods indicate that most natural resources have become scarcer over time.

Measured in 2010 dollars, real GDP per person in the United States in 2010 was about

When Americans invest in Russia, the income of Russians that is, Russian GNP) rises by more than production in Russia that is, Russian GDP).

Which of the following statements is true?

If your firm's production function has constant returns to scale, then if you double all your inputs, your firm's output will

In 1870, the richest country in the world was

Which of the following lists contains, in this order, natural resources, human capital, and physical capital?

In the United States in 2010 real GDP per person was about $47,000, while in some poor countries real GDP per person was less than $5,000.

Countries that grew the fastest over the last 100 or so years had average growth rates of real income per person of about

An increase in capital will increase real GNP per person

Consider the nations of India, Indonesia, and Japan. Over the past century, which of these three nations has experienced, by far, more rapid economic growth than the other two nations?

"When workers acquire tools, they become more productive." This statement reflects the general fact that is a determinant of productivity.

In the equation for the production function H/L represents

An understanding of the best ways to produce goods and services is called

Country A has twice as many workers as Country B. Country A also has twice as much physical capital, twice as much human capital, and access to twice as many natural resources as Country B. Assuming constant-returns to scale, which of the following is higher in Country A?

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, Demand, and Government Policies

Consumers, Producers, and the Efficiency of Markets

Application: The Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Costs of Production

Firms in Competitive Markets

Monopoly

Measuring a Nations Income

Measuring the Cost of Living

Saving, Investment, and the Financial System

The Basic Tools of Finance

Unemployment

The Monetary System

Money Growth and Inflation

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

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