Question 1

The behavior of market prices over time indicates that natural resources

Accepted Answer

A)   are a limit to economic growth.
B)   are unrelated to economic growth.
C)   are not a limit to economic growth.
D)   are the major determinant of productivity.E) B) and C)
F) All of the above

Question 2

Last year real GDP per person in the imaginary nation of Olympus was 4,500.The year before it was 4,250.By about what percentage did Olympian real GDP per person grow during the period?

Accepted Answer

A)   4.6 percent
B)   5.2 percent
C)   5.9 percent
D)   6.5 percentE) All of the above
F) A) and B)

Question 3

Natural resources

Accepted Answer

A)   are inputs provided by nature.
B)   are inputs such as land,rivers,and mineral deposits.
C)   take two forms: renewable and nonrenewable.
D)   All of the above are correct.E) C) and D)
F) B) and D)

Question 4

For a given year,productivity in a particular country is most closely matched with that country's

Accepted Answer

A)   level of real GDP over that year.
B)   level of real GDP divided by hours worked over that year.
C)   growth rate of real GDP divided by hours worked over that year.
D)   growth rate of real GDP per person over that year.E) A) and B)
F) A) and C)

Question 5

Suppose that an American opens and operates a candy factory in Finland.This is an example of

Accepted Answer

A)   foreign direct investment.American saving is used to finance Finish investment.
B)   foreign direct investment.American saving is used to finance American investment.
C)   foreign portfolio investment.American saving is used to finance Finish investment.
D)   foreign portfolio investment.American saving is used to finance American investment.E) None of the above
F) A) and B)

Question 6

Country A has a population of 1,000,of whom 700 worked an average of 8 hours a day and had a productivity of 2.5.Country B has a population of 800,of whom 560 worked 8 hours a day and had productivity of 3.0.The country with the higher real GDP was

Accepted Answer

A)   country A,and the country with higher real GDP per person was country A.
B)   country A,and the country with higher real GDP per person was country B.
C)   country B,and the country with higher real GDP per person was country A.
D)   country B,and the country with higher real GDP per person was country B.E) None of the above
F) B) and D)

Question 7

National defense and knowledge are generally considered to be

Accepted Answer

A)   private goods.
B)   public goods.
C)   proprietary goods.
D)   societal goods.E) A) and B)
F) All of the above

Question 8

Scenario 25-1.An economy's production form takes the form Y = AF(L,K,H,N) .
-Refer to Scenario 25-1.If the production function has the constant-returns-to-scale property,then it is possible that the specific form of the production function is

Accepted Answer

A)   Y = 4L + 2K + 3H + N
B)   Y = (L + K + H + N) /4
C)   Y =2
D)   Y = 4E) B) and C)
F) A) and B)

Question 9

If a country were to increase its saving rate,then in the long run it would also increase its

Accepted Answer

A)   level of income.
B)   growth rate of income.
C)   growth rate of productivity.
D)   All of the above are correct.E) All of the above
F) B) and D)

Question 10

If Country A produces 6,000 units of goods and services using 600 hours of labor,and if Country B produces 5,000 units of goods and services using 450 units of labor,then productivity is higher in Country B than in Country A.

Accepted Answer

A) True 
 B)False

Question 11

Country A and country B are the same except country A currently has a lower level of capital.Assuming diminishing returns,if both countries increase their capital by 100 units and other factors that determine output are unchanged,then

Accepted Answer

A)   output in country A increases by more than in country B.
B)   output in country A increases by the same amount as in country B.
C)   output in country A increases by less than in country B.
D)   None of the above is necessarily correct.E) B) and C)
F) A) and C)

Question 12

Suppose there are constant returns to scale.Now suppose that over time a country doubles its workers,its natural resources,its physical capital,and its human capital,but its technology is unchanged.Which of the following would double?

Accepted Answer

A)   both output and productivity
B)   output,but not productivity
C)   productivity,but not output
D)   neither productivity nor outputE) All of the above
F) B) and C)

Question 13

You are told that Country A experienced growth of real GDP per person of 4 percent per year throughout the 1900s.In view of other countries' experience,you would have to characterize Country A's growth as

Accepted Answer

A)   exceptionally high.
B)   moderately high.
C)   moderately low.
D)   exceptionally low.E) A) and C)
F) A) and B)

Question 14

Which of the following is a determinant of productivity?

Accepted Answer

A)   human capital per worker
B)   physical capital per worker
C)   natural resources per worker
D)   All of the above are correct.E) All of the above
F) A) and D)

Question 15

The Economic Development Minister of a country has a list of things she thinks may explain her country's low growth of real GDP per person relative to other countries.She asks you to pick the one you think most likely explains her country's low growth.Which of the following contributes to low growth?

Accepted Answer

A)   poorly enforced property rights
B)   outward-oriented trade policies
C)   policies that permit foreign investment
D)   All of the above are correct.E) C) and D)
F) All of the above

Question 16

Greater scarcity of a natural resource is indicated

Accepted Answer

A)   by an increase in the price of the resource,whether the price increase is less than or greater than the rate of inflation.
B)   only by an increase in the price of the resource that is less than the rate of inflation.
C)   only by an increase in the price of the resource that is greater than the rate of inflation.
D)   only by an increase in the price of the resource that is caused by a decrease in supply and is greater than the rate of inflation.E) C) and D)
F) All of the above

Question 17

As capital per worker rises,output per worker rises.However,the increase in output per worker from an addition to capital is smaller,the larger is the existing amount of capital per worker.

Accepted Answer

A) True 
 B)False

Question 18

Other things the same,a country that increases its saving rate increases

Accepted Answer

A)   its future productivity and future real GDP.
B)   neither its future productivity nor future real GDP.
C)   its future productivity,but not its future real GDP.
D)   its future real GDP,but not its future productivity.E) B) and C)
F) All of the above

Question 19

In the long run,a higher saving rate

Accepted Answer

A)   cannot increase the capital stock.
B)   means that people must consume less in the future.
C)   increases the level of productivity.
D)   None of the above is correct.E) C) and D)
F) None of the above

Question 20

Economist Michael Kremer found that world growth rates fell as population increased.

Accepted Answer

A) True 
 B)False

Exam 25: Production and Growth

Suppose that an American opens and operates a candy factory in Finland.This is an example of

Correct Answer
verified

Which of the following is a determinant of productivity?

Correct Answer
verified

Scenario 25-1.An economy's production form takes the form Y = AF(L,K,H,N) . -Refer to Scenario 25-1.If the production function has the constant-returns-to-scale property,then it is possible that the specific form of the production function is

Correct Answer
verified

Natural resources

Correct Answer
verified

Correct Answer
verified

The behavior of market prices over time indicates that natural resources

Correct Answer
verified

As capital per worker rises,output per worker rises.However,the increase in output per worker from an addition to capital is smaller,the larger is the existing amount of capital per worker.

Correct Answer
verified

Economist Michael Kremer found that world growth rates fell as population increased.

Correct Answer
verified

Last year real GDP per person in the imaginary nation of Olympus was 4,500.The year before it was 4,250.By about what percentage did Olympian real GDP per person grow during the period?

Correct Answer
verified

You are told that Country A experienced growth of real GDP per person of 4 percent per year throughout the 1900s.In view of other countries' experience,you would have to characterize Country A's growth as

Correct Answer
verified

Suppose there are constant returns to scale.Now suppose that over time a country doubles its workers,its natural resources,its physical capital,and its human capital,but its technology is unchanged.Which of the following would double?

Correct Answer
verified

If Country A produces 6,000 units of goods and services using 600 hours of labor,and if Country B produces 5,000 units of goods and services using 450 units of labor,then productivity is higher in Country B than in Country A.

Correct Answer
verified

Greater scarcity of a natural resource is indicated

Correct Answer
verified

Other things the same,a country that increases its saving rate increases

Correct Answer
verified

If a country were to increase its saving rate,then in the long run it would also increase its

Correct Answer
verified

Country A and country B are the same except country A currently has a lower level of capital.Assuming diminishing returns,if both countries increase their capital by 100 units and other factors that determine output are unchanged,then

Correct Answer
verified

In the long run,a higher saving rate

Correct Answer
verified

National defense and knowledge are generally considered to be

Correct Answer
verified

For a given year,productivity in a particular country is most closely matched with that country's

Correct Answer
verified

Country A has a population of 1,000,of whom 700 worked an average of 8 hours a day and had a productivity of 2.5.Country B has a population of 800,of whom 560 worked 8 hours a day and had productivity of 3.0.The country with the higher real GDP was

Correct Answer
verified

Exam 25: Production and Growth

Suppose that an American opens and operates a candy factory in Finland.This is an example of

Correct AnswerverifiedShow Answer

Which of the following is a determinant of productivity?

Correct AnswerverifiedShow Answer

Scenario 25-1.An economy's production form takes the form Y = AF(L,K,H,N) . -Refer to Scenario 25-1.If the production function has the constant-returns-to-scale property,then it is possible that the specific form of the production function is

Correct AnswerverifiedShow Answer

Natural resources

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The behavior of market prices over time indicates that natural resources

Correct AnswerverifiedShow Answer

As capital per worker rises,output per worker rises.However,the increase in output per worker from an addition to capital is smaller,the larger is the existing amount of capital per worker.

Correct AnswerverifiedShow Answer

Economist Michael Kremer found that world growth rates fell as population increased.

Correct AnswerverifiedShow Answer

Last year real GDP per person in the imaginary nation of Olympus was 4,500.The year before it was 4,250.By about what percentage did Olympian real GDP per person grow during the period?

Correct AnswerverifiedShow Answer

You are told that Country A experienced growth of real GDP per person of 4 percent per year throughout the 1900s.In view of other countries' experience,you would have to characterize Country A's growth as

Correct AnswerverifiedShow Answer

Suppose there are constant returns to scale.Now suppose that over time a country doubles its workers,its natural resources,its physical capital,and its human capital,but its technology is unchanged.Which of the following would double?

Correct AnswerverifiedShow Answer

If Country A produces 6,000 units of goods and services using 600 hours of labor,and if Country B produces 5,000 units of goods and services using 450 units of labor,then productivity is higher in Country B than in Country A.

Correct AnswerverifiedShow Answer

Greater scarcity of a natural resource is indicated

Correct AnswerverifiedShow Answer

Other things the same,a country that increases its saving rate increases

Correct AnswerverifiedShow Answer

If a country were to increase its saving rate,then in the long run it would also increase its

Correct AnswerverifiedShow Answer

Country A and country B are the same except country A currently has a lower level of capital.Assuming diminishing returns,if both countries increase their capital by 100 units and other factors that determine output are unchanged,then

Correct AnswerverifiedShow Answer

In the long run,a higher saving rate

Correct AnswerverifiedShow Answer

National defense and knowledge are generally considered to be

Correct AnswerverifiedShow Answer

For a given year,productivity in a particular country is most closely matched with that country's

Correct AnswerverifiedShow Answer

Country A has a population of 1,000,of whom 700 worked an average of 8 hours a day and had a productivity of 2.5.Country B has a population of 800,of whom 560 worked 8 hours a day and had productivity of 3.0.The country with the higher real GDP was

Correct AnswerverifiedShow Answer

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