Question 1

If Real GDP is $6 billion and the population is 300,000, per-capita Real GDP is

Accepted Answer

A) $30,000. 
B) $20,000. 
C) $33,333. 
D) $39,434.

Question 2

If an economy can increase its steady annual growth rate from 1 percent to 1.5 percent, this reduces the time it takes for the economy to double in size by approximately __________ years.

Accepted Answer

A) 5 
B) 8 
C) 33 
D) 17 
E) 23

Question 3

Neoclassical growth theory emphasized how __________ contribute to growth.

Accepted Answer

A) the resources labor and capital 
B) technological changes 
C) government policies 
D) factors limiting population growth

Question 4

When interest rates fall in a given economy, it causes firms to borrow __________ funds used for purchasing capital goods. The result will be a(n) ___________ in the level of capital employed in the economy. In terms of the production function (graphed with labor on the horizontal axis and Real GDP on the vertical axis), this then causes ____________________ which makes the LRAS curve shift ____________ resulting in ______________________.

Accepted Answer

A) more; increase; the production function to shift upward; rightward; economic growth 
B) less; decrease; the production function to shift downward; leftward; a shrinking economy 
C) more; increase; a movement up along a given production function; rightward; economic growth 
D) more; increase; a movement down along a given production function; leftward; a shrinking economy

Question 5

"Absolute real economic growth" is defined as an increase in __________ from one period to the next.

Accepted Answer

A) GDP 
B) Real GDP 
C) Real GDP per person 
D) the inflation rate

Question 6

New growth theory holds technology to be __________; neoclassical growth theory holds technology to be __________.

Accepted Answer

A) exogenous; endogenous 
B) endogenous; endogenous 
C) endogenous; exogenous 
D) exogenous; exogenous

Question 7

Neoclassical growth theory does not emphasize how __________ contribute to growth.

Accepted Answer

A) the quantity of capital 
B) technological changes 
C) the quantity of labor 
D) factors limiting population growth 
E) a and c

Question 8

The concept that economic growth can do more than just give us more goods and services goes back to Adam Smith.

Accepted Answer

A) True 
 B)False

Question 9

Suppose the population of country ABC rises from 40 million to 44 million. If the country's Real GDP rises from $825 billion to $890 billion during this same period, the result is _________________ economic growth.

Accepted Answer

A) both absolute economic growth and per-capita real 
B) absolute economic growth, but not per-capita real 
C) per-capita real economic growth, but not absolute 
D) neither absolute economic growth nor per-capita real

Question 10

When interest rates in a given economy are reduced, it causes firms to employ __________ capital goods. In terms of the production function (graphed with labor on the horizontal axis and Real GDP on the vertical axis), this then causes ____________________ .

Accepted Answer

A) more; the production function to shift upward 
B) less; the production function to shift downward 
C) more; a movement up along a given production function 
D) more; a movement down along a given production function

Question 11

Compare a property rights system in which people are allowed to keep one-third of the monetary rewards of their labor with a system in which they keep two-thirds. An economist would expect that more people to decide to go to work under the __________ system and that many of those already working would decide to work more under the __________ system.

Accepted Answer

A) former; former 
B) former; latter 
C) latter; former 
D) latter; latter

Question 12

Suppose the population of a country rises significantly. If the country's Real GDP remains constant, the result is _________________ economic growth.

Accepted Answer

A) both absolute economic growth and per-capita real 
B) absolute economic growth, but not per-capita real 
C) per-capita real economic growth, but not absolute 
D) neither absolute economic growth nor per-capita real

Question 13

Exhibit 17-3

-Refer to Exhibit 17-3 Assume that the starting point on the production function is point A. After an increase in the quantity of capital, there would be a ______________________ which would shift the LRAS curve from LRAS1 to _______________ resulting in _______________..

Accepted Answer

A) movement along the production function to point C; LRAS2; economic growth 
B) shift upward of the production function to point B; LRAS2; economic growth 
C) movement along the production function to point C; LRAS3; a shrinking economy 
D) shift upward of the production function to point B; LRAS3; a shrinking economy

Question 14

Stan Laurel and Oliver Hardy acted separately in comedy shorts for the Hal Roach Studio for over a decade without greatly distinguishing themselves from hundreds of other screen comedians. Then in 1927, Roach writer-director Leo McCarey tried them out as a comedy team in one more routine short. Only then was the fantastic chemistry between "the fiddle and the bow" realized. The rest is immortality. This story relates to the "new growth theory" idea of

Accepted Answer

A) employee involvement. 
B) rearranging. 
C) exogeneity. 
D) objects and ideas.

Question 15

Economists Barro and McCleary's research regarding the impact of religious beliefs on economic growth noted that a belief in hell matters more to economic growth than the belief in heaven.

Accepted Answer

A) True 
 B)False

Question 16

Business cycle macroeconomics deals with ___________Natural Real GDP level, while economic growth macroeconomics deals with ________________ Natural Real GDP level.

Accepted Answer

A) movements around a given; movements to a new 
B) movements to a new; movements around a given 
C) economies experiencing a falling; economies with a growing 
D) economies experiencing a growing; economies with a falling

Question 17

An economy doubles in size every 20 years if it maintains a steady annual growth rate of about __________ percent.

Accepted Answer

A) 4.0 
B) 2.8 
C) 3.5 
D) 2.0

Question 18

When a production function is graphed with Real GDP on the vertical axis and labor on the horizontal axis, a rise in labor ________________________which shifts the LRAS curve ____________ resulting in ______________________.

Accepted Answer

A) shifts the production function up; rightward; economic growth 
B) shifts the production function down; leftward; a shrinking economy 
C) moves us up along a given production function; rightward; economic growth 
D) moves us down along a given production function; leftward; a shrinking economy

Question 19

Lower income taxes cause a ____________shift of the labor supply curve, which then produces__________ Real GDP.

Accepted Answer

A) rightward; less 
B) rightward; more 
C) leftward; less 
D) leftward; more

Question 20

According to economist Benjamin Friedman, sustained economic growth can make people more willing to work toward improving the environment and reducing poverty.

Accepted Answer

A) True 
 B)False

Exam 17: Economic Growth Resources Technology Ideas and Institutions

If Real GDP is $6 billion and the population is 300,000, per-capita Real GDP is

If an economy can increase its steady annual growth rate from 1 percent to 1.5 percent, this reduces the time it takes for the economy to double in size by approximately __________ years.

Neoclassical growth theory emphasized how __________ contribute to growth.

"Absolute real economic growth" is defined as an increase in __________ from one period to the next.

New growth theory holds technology to be ; neoclassical growth theory holds technology to be .

Neoclassical growth theory does not emphasize how __________ contribute to growth.

The concept that economic growth can do more than just give us more goods and services goes back to Adam Smith.

Suppose the population of country ABC rises from 40 million to 44 million. If the country's Real GDP rises from $825 billion to $890 billion during this same period, the result is _________________ economic growth.

When interest rates in a given economy are reduced, it causes firms to employ capital goods. In terms of the production function (graphed with labor on the horizontal axis and Real GDP on the vertical axis) , this then causes __________ .

Suppose the population of a country rises significantly. If the country's Real GDP remains constant, the result is _________________ economic growth.

Exhibit 17-3 -Refer to Exhibit 17-3 Assume that the starting point on the production function is point A. After an increase in the quantity of capital, there would be a ______________ which would shift the LRAS curve from LRAS₁ to _ resulting in _________..

Economists Barro and McCleary's research regarding the impact of religious beliefs on economic growth noted that a belief in hell matters more to economic growth than the belief in heaven.

Business cycle macroeconomics deals with _Natural Real GDP level, while economic growth macroeconomics deals with ______ Natural Real GDP level.

An economy doubles in size every 20 years if it maintains a steady annual growth rate of about __________ percent.

When a production function is graphed with Real GDP on the vertical axis and labor on the horizontal axis, a rise in labor __which shifts the LRAS curve resulting in .

Lower income taxes cause a __shift of the labor supply curve, which then produces Real GDP.

According to economist Benjamin Friedman, sustained economic growth can make people more willing to work toward improving the environment and reducing poverty.

Exam 17: Economic Growth Resources Technology Ideas and Institutions

If Real GDP is $6 billion and the population is 300,000, per-capita Real GDP is

If an economy can increase its steady annual growth rate from 1 percent to 1.5 percent, this reduces the time it takes for the economy to double in size by approximately __________ years.

Neoclassical growth theory emphasized how __________ contribute to growth.

"Absolute real economic growth" is defined as an increase in __________ from one period to the next.

New growth theory holds technology to be __________; neoclassical growth theory holds technology to be __________.

Neoclassical growth theory does not emphasize how __________ contribute to growth.

The concept that economic growth can do more than just give us more goods and services goes back to Adam Smith.

Suppose the population of country ABC rises from 40 million to 44 million. If the country's Real GDP rises from $825 billion to $890 billion during this same period, the result is _________________ economic growth.

When interest rates in a given economy are reduced, it causes firms to employ __________ capital goods. In terms of the production function (graphed with labor on the horizontal axis and Real GDP on the vertical axis) , this then causes ____________________ .

Suppose the population of a country rises significantly. If the country's Real GDP remains constant, the result is _________________ economic growth.

Exhibit 17-3 -Refer to Exhibit 17-3 Assume that the starting point on the production function is point A. After an increase in the quantity of capital, there would be a ______________________ which would shift the LRAS curve from LRAS1 to _______________ resulting in _______________..

Economists Barro and McCleary's research regarding the impact of religious beliefs on economic growth noted that a belief in hell matters more to economic growth than the belief in heaven.

Business cycle macroeconomics deals with ___________Natural Real GDP level, while economic growth macroeconomics deals with ________________ Natural Real GDP level.

An economy doubles in size every 20 years if it maintains a steady annual growth rate of about __________ percent.

When a production function is graphed with Real GDP on the vertical axis and labor on the horizontal axis, a rise in labor ________________________which shifts the LRAS curve ____________ resulting in ______________________.

Lower income taxes cause a ____________shift of the labor supply curve, which then produces__________ Real GDP.

According to economist Benjamin Friedman, sustained economic growth can make people more willing to work toward improving the environment and reducing poverty.

New growth theory holds technology to be ; neoclassical growth theory holds technology to be .

When interest rates in a given economy are reduced, it causes firms to employ capital goods. In terms of the production function (graphed with labor on the horizontal axis and Real GDP on the vertical axis) , this then causes __________ .

Exhibit 17-3 -Refer to Exhibit 17-3 Assume that the starting point on the production function is point A. After an increase in the quantity of capital, there would be a ______________ which would shift the LRAS curve from LRAS₁ to _ resulting in _________..

Business cycle macroeconomics deals with _Natural Real GDP level, while economic growth macroeconomics deals with ______ Natural Real GDP level.

When a production function is graphed with Real GDP on the vertical axis and labor on the horizontal axis, a rise in labor __which shifts the LRAS curve resulting in .

Lower income taxes cause a __shift of the labor supply curve, which then produces Real GDP.