Question 1

Country A experienced a growth rate of real GDP per person of 0.5 percent per year throughout the 1900's. In view of other countries' experiences, country A's growth was

Accepted Answer

A)  exceptionally high. 
B)  moderately high. 
C)  moderately low. 
D)  exceptionally low. 
A)  exceptionally high. 
B)  moderately high. 
C)  moderately low. 
D)  exceptionally low.

Question 2

Proprietary technology is knowledge that is

Accepted Answer

A)  known but no longer used much. 
B)  known, but only recently discovered. 
C)  known mostly by only those in a certain profession. 
D)  known only by the company that discovered it. 
A)  known but no longer used much. 
B)  known, but only recently discovered. 
C)  known mostly by only those in a certain profession. 
D)  known only by the company that discovered it.

Question 3

Economists generally believe that inward-oriented policies are more likely to foster growth than outward-oriented policies.

Accepted Answer

A) True 
 B)False

Question 4

Investment in human capital has opportunity costs, but investment in physical capital does not.

Accepted Answer

A) True 
 B)False

Question 5

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

Accepted Answer

A)  For a shoe factory: leather, hand tools, the managers' knowledge of shoe making. 
B)  For a steel mill: the blast furnaces, iron ore, the workers. 
C)  For an airline: oil used to make jet fuel, the pilots' knowledge of flying, jets. 
D)  None of the above is correct. 
A)  For a shoe factory: leather, hand tools, the managers' knowledge of shoe making. 
B)  For a steel mill: the blast furnaces, iron ore, the workers. 
C)  For an airline: oil used to make jet fuel, the pilots' knowledge of flying, jets. 
D)  None of the above is correct.

Question 6

What do we mean when we say that some technological knowledge is not proprietary?

Accepted Answer

Technological knowledge is not

Question 7

A nation's standard of living is determined by

Accepted Answer

A)  the percentage of its GDP that is accounted for by government purchases. 
B)  the quantity of natural resources with which it is endowed. 
C)  the productivity of its workers. 
D)  factors and events that are beyond the nation's control. 
A)  the percentage of its GDP that is accounted for by government purchases. 
B)  the quantity of natural resources with which it is endowed. 
C)  the productivity of its workers. 
D)  factors and events that are beyond the nation's control.

Question 8

When a country eliminates tariffs and other trade restrictions, intending to promote economic growth, it is pursuing_______-oriented policies.

Accepted Answer

The answer of When a country eliminates tariffs and other...

Question 9

If a Japanese company opens a new factory in South Korea, it makes

Accepted Answer

A)  foreign direct investment. The factory will make a bigger impact on South Korea's GDP than on its GNP. 
B)  foreign direct investment. The factory will make a bigger impact on South Korea's GNP than on its GDP. 
C)  foreign portfolio investment. The factory will make a bigger impact on South Korea's GDP than on its GNP. 
D)  foreign portfolio investment. The factory will make a bigger impact on South Korea's GNP than on its GDP. 
A)  foreign direct investment. The factory will make a bigger impact on South Korea's GDP than on its GNP. 
B)  foreign direct investment. The factory will make a bigger impact on South Korea's GNP than on its GDP. 
C)  foreign portfolio investment. The factory will make a bigger impact on South Korea's GDP than on its GNP. 
D)  foreign portfolio investment. The factory will make a bigger impact on South Korea's GNP than on its GDP.

Question 10

Outward-oriented policies

Accepted Answer

A)  allow countries to take advantage of gains from trade. 
B)  have generally led to high growth for the countries that pursued them. 
C)  receive widespread support from economists. 
D)  All of the above are correct. 
A)  allow countries to take advantage of gains from trade. 
B)  have generally led to high growth for the countries that pursued them. 
C)  receive widespread support from economists. 
D)  All of the above are correct.

Question 11

The equipment and structures available to produce goods and services are called

Accepted Answer

A)  physical capital. 
B)  human capital. 
C)  the production function. 
D)  technology. 
A)  physical capital. 
B)  human capital. 
C)  the production function. 
D)  technology.

Question 12

The dictator of a country requires that companies planning to open or expand must pay a large fee to file an application one year prior to building new factories or expanding existing ones. Other things the same, in the long run this requirement would

Accepted Answer

A)  reduce real GDP per person and productivity. 
B)  reduce real GDP per person but not productivity. 
C)  reduce productivity but not real GDP per person. 
D)  None of the above is correct. 
A)  reduce real GDP per person and productivity. 
B)  reduce real GDP per person but not productivity. 
C)  reduce productivity but not real GDP per person. 
D)  None of the above is correct.

Question 13

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 14

Which of the following statements is correct? In 2010,

Accepted Answer

A)  real income per person in the U.S. was about 6 times that in China. 
B)  real income per person in China was more than 2 times that in India. 
C)  the typical resident of India had less real income than the typical resident of England in 1870. 
D)  All of the above are correct. 
A)  real income per person in the U.S. was about 6 times that in China. 
B)  real income per person in China was more than 2 times that in India. 
C)  the typical resident of India had less real income than the typical resident of England in 1870. 
D)  All of the above are correct.

Question 15

Scenario 25-1. An economy's production form takes the form Y = AFL, K, H, N).
-Refer to Scenario 25-1. If the production function has the constant-returns-to-scale property, then it can be rewritten as

Accepted Answer

A)  Y/L = AF1, K/L, H/L, N/L) 
B)  Y/L = AFL, 1, H/L, N/L) 
C)  Y/L = AFL, K/L, 1, N/L) 
D)  Y/L = AFL, K/L, H/L, 1) 
A)  Y/L = AF1, K/L, H/L, N/L) 
B)  Y/L = AFL, 1, H/L, N/L) 
C)  Y/L = AFL, K/L, 1, N/L) 
D)  Y/L = AFL, K/L, H/L, 1)

Question 16

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. The curve becomes flatter as the amount of capital per worker increases because of

Accepted Answer

A)  increasing returns to capital. 
B)  increasing returns to labor. 
C)  diminishing returns to capital. 
D)  diminishing returns to labor. 
A)  increasing returns to capital. 
B)  increasing returns to labor. 
C)  diminishing returns to capital. 
D)  diminishing returns to labor.

Question 17

In what sense is it likely that geography has an effect on a country's rate of economic growth?

Accepted Answer

Countries with natural seaport

Question 18

In what sense is capital accumulation costly to a society?

Accepted Answer

Capital accumulation requires

Question 19

The saws, lathes, and drill presses that woodworkers at Cedar Valley Furniture use to produce furniture are called

Accepted Answer

A)  human capital. 
B)  physical capital. 
C)  natural resources. 
D)  technological knowledge. 
A)  human capital. 
B)  physical capital. 
C)  natural resources. 
D)  technological knowledge.

Question 20

The same size decrease in the amount of capital stock per worker will cause output per worker to fall by more in a country with a relatively high level of capital per worker than in a country with a relatively low level of capital per worker.

Accepted Answer

A) True 
 B)False

Exam 17: Production and Growth

Country A experienced a growth rate of real GDP per person of 0.5 percent per year throughout the 1900's. In view of other countries' experiences, country A's growth was

Proprietary technology is knowledge that is

Economists generally believe that inward-oriented policies are more likely to foster growth than outward-oriented policies.

Investment in human capital has opportunity costs, but investment in physical capital does not.

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

What do we mean when we say that some technological knowledge is not proprietary?

A nation's standard of living is determined by

When a country eliminates tariffs and other trade restrictions, intending to promote economic growth, it is pursuing_______-oriented policies.

If a Japanese company opens a new factory in South Korea, it makes

Outward-oriented policies

The equipment and structures available to produce goods and services are called

The dictator of a country requires that companies planning to open or expand must pay a large fee to file an application one year prior to building new factories or expanding existing ones. Other things the same, in the long run this requirement would

If there are diminishing returns to capital, then

Which of the following statements is correct? In 2010,

Scenario 25-1. An economy's production form takes the form Y = AFL, K, H, N). -Refer to Scenario 25-1. If the production function has the constant-returns-to-scale property, then it can be rewritten as

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. The curve becomes flatter as the amount of capital per worker increases because of

In what sense is it likely that geography has an effect on a country's rate of economic growth?

In what sense is capital accumulation costly to a society?

The saws, lathes, and drill presses that woodworkers at Cedar Valley Furniture use to produce furniture are called

The same size decrease in the amount of capital stock per worker will cause output per worker to fall by more in a country with a relatively high level of capital per worker than in a country with a relatively low level of capital per worker.

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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