Exam 22: Long-Run Economic Growth: Sources and Policies

All of the following are reasons why China is unlikely to maintain high enough rates of productivity growth to catch-up with the standard of living in the United States except

Would you expect to see higher or lower growth rates for countries that start out with a relatively low level of real GDP per capita? Explain using the concept of "catch-up" and support your answer with a graph.

Table 22-4 Country Real GDP per Capita (in 1996 dollars) Growth in Real GDP per Capita, 1960-2000 Botswana \ 958 5.29\% Thailand 1,091 4.70\% Japan 4,544 4.32\% Guatemala 2,344 1.29\% -Refer to Table 22-4.In the table above,which countries are consistent with the predictions of the economic growth model?

Figure 22-4 -Refer to Figure 22-4.The movement from A to B to C illustrates

An economic growth model

Policies to promote growth by increasing saving and investment work through

The productivity slowdown experience in the United States from the mid-1970s to the mid-1990s occurred in all high-income countries.

Consider two countries,Alpha and Beta.In Alpha,real GDP per capita is $6,000.In Beta,real GDP per capita is $9,000.Based on the economic growth model,what would you predict about the growth rates in real GDP per capita across these two countries?

How can freedom of the press promote economic growth?

The Soviet Union consistently increased the amount of capital available to its workers,but found that increases in capital resulted in progressively smaller and smaller increases in GDP per worker.This phenomenon is referred to as

Which of the following policies would not help promote economic growth?

Suppose that an increase in capital per hour worked from $15,000 to $20,000 increases real GDP per hour worked by $500.If capital per hour worked increases further to $25,000,by how much would you expect real GDP per hour worked to increase if there are diminishing returns?

When an economy faces diminishing returns

Figure 22-2 -Refer to Figure 22-2.Based on the per-worker production function above,if the economy raises capital per hour worked from $35,000 to $40,000,by how much will real GDP per hour worked increase?

The "new economy" that emerged in the mid-1990s is based on

________ is considered a high income country,________ a developing country,and ________ a newly industrializing country.

Describe the process of "creative destruction" using a specific example.

Technological change is the key to sustaining economic growth.

According to Joseph Schumpeter,economic growth is achieved through

Explain how advances in technology are critical to sustaining economic growth,even if capital per hour worked is consistently increasing.Provide a graph of a per-worker production function to support your answer.