Exam 17: Production and Growth

The people of Country X save 10 percent of their income, and the people of Country Y save 25 percent of their income. If these respective saving rates persist forever, will one country or the other enjoy a higher rate of income growth forever? Explain.

Proprietary technology is technology

Suppose that an American company opens and operates a restaurant in Ireland. This is an example of

"When workers already have a large quantity of capital to use in producing goods and services, giving them an additional unit of capital increases their productivity only slightly." This statement

Human capital is the

If it could increase its growth rates slightly, a country with low income would catch up with rich countries in about ten years.

Economists differ in their views of the role of the government in promoting economic growth. At the very least, the government should

Which of the following would, by itself, reveal the most about a country's standard of living?

If a rich country reduced subsidies to domestic producers of goods that poor countries have a comparative advantage producing, the standard of living in these poor countries would likely rise.

Electronics firms may be able to get patents on their ideas. Doing so makes their ideas

Country A has real GDP per person of 250,000 while Country B has real GDP per person of 500,000. All else constant, Country A will eventually have a higher standard of living than Country B if

Rapid population growth

Figure 25-1. On the horizontal axis, K/L represents capital K) per worker L). On the vertical axis, Y/L represents output Y) per worker L). -Refer to Figure 25-1. Choose a point anywhere on the curve and call it point A. If the economy is at point A in 2011, then it will definitely remain at point A in 2012 if, between 2011 and 2012,

Which of the following is an example of physical capital?

Figure 25-1 -Refer to Figure 21-1. In what way is the figure relevant to the catch-up effect?

When a society decides to increase its quantity of physical capital, the society

An economy's production function has the constant­returns­to­scale property. If the economy's labor force doubled and all other inputs stayed the same, then real GDP would

Which of the following is a correct way to measure productivity?

The average income in a rich country

Suppose that the U.S. undertakes a policy to increase its saving rate. This policy will likely