Question 1

Economic freedom provides the

Accepted Answer

A)   incentive system that encourages growth-producing activities.
B)   political system that encourages democracy.
C)   necessary alternative to free markets.
D)   production system that discourages property rights.
E)   social system that supports families.

Question 2

According to the new growth theory, which of the following promote economic growth?
i. Discoveries that bring profit.
ii. Choices that expand human capital.
iii. Random events that create technological change.

Accepted Answer

A)   i and iii
B)   ii only
C)   i, ii and iii
D)   i only
E)   i and ii

Question 3

The effect of an increase in labour productivity, assuming no change in the supply of labour, is
i. an increase in the real wage.
ii. an increase in potential GDP.
iii. a decrease in the demand for labour.

Accepted Answer

A)   i only
B)   i and ii
C)   i and iii
D)   ii and iii
E)   i, ii and iii

Question 4

As additional units of labour hours are employed, holding all other factors constant, along the production function,

Accepted Answer

A)   nominal GDP decreases at an increasing rate.
B)   real GDP increase at a constant rate.
C)   real GDP increases at a decreasing rate.
D)   real GDP increases at an increasing rate.
E)   real GDP initially decreases and then starts to increase.

Question 5

-The above figure shows a nation's production function. Point B is

Accepted Answer

A)   unattainable.
B)   attainable if the nation uses resources inefficiently.
C)   the maximum amount of real GDP the nation can ever produce.
D)   attainable if the nation uses resources efficiently.
E)   Both answers C and D are correct.

Question 6

If real GDP in year 1 is $72 million and real GDP in year 2 is $87 million, then the growth rate of real GDP is

Accepted Answer

A)   15 per cent.
B)   20.8 per cent.
C)   17 per cent.
D)   83 per cent.
E)   $15 million.

Question 7

One way to achieve faster growth in GDP per person is to increase the

Accepted Answer

A)   growth rate of the population.
B)   limits on international trade in order to keep more of total spending on domestically produced goods.
C)   number of women working in the home rather than in the workforce.
D)   growth rate of human capital.
E)   growth rate of the quantity of money.

Question 8

Sustained increases in the standard of living depend on

Accepted Answer

A)   increases in aggregate hours.
B)   increases in the quantity of labour.
C)   increases in labour productivity.
D)   decreases in labour productivity.
E)   increases in the population.

Question 9

The presence of government corruption in some countries

Accepted Answer

A)   invalidates the neoclassical growth theory's predictions.
B)   supports the classical growth theory's predictions.
C)   speeds their economic growth.
D)   slows their economic growth.
E)   invalidates the new growth theory's predictions.

Question 10

-Using the data in the table above, real GDP per person in 2009 is

Accepted Answer

A)   $70 trillion.
B)   $75,000.
C)   $71,429.
D)   7 per cent.
E)   $70,000.

Question 11

For a household, the opportunity cost of not working is the

Accepted Answer

A)   nominal wage rate.
B)   demand for labour.
C)   real wage rate.
D)   cost of living.
E)   price level.

Exam 8: Economic Growth

The presence of government corruption in some countries

Correct Answer
verified

According to the new growth theory, which of the following promote economic growth? i. Discoveries that bring profit. ii. Choices that expand human capital. iii. Random events that create technological change.

Correct Answer
verified

The effect of an increase in labour productivity, assuming no change in the supply of labour, is i. an increase in the real wage. ii. an increase in potential GDP. iii. a decrease in the demand for labour.

Correct Answer
verified

-Using the data in the table above, real GDP per person in 2009 is

Correct Answer
verified

-The above figure shows a nation's production function. Point B is

Correct Answer
verified

Sustained increases in the standard of living depend on

Correct Answer
verified

For a household, the opportunity cost of not working is the

Correct Answer
verified

As additional units of labour hours are employed, holding all other factors constant, along the production function,

Correct Answer
verified

If real GDP in year 1 is $72 million and real GDP in year 2 is $87 million, then the growth rate of real GDP is

Correct Answer
verified

One way to achieve faster growth in GDP per person is to increase the

Correct Answer
verified

Economic freedom provides the

Correct Answer
verified

Exam 8: Economic Growth

The presence of government corruption in some countries

Correct AnswerverifiedShow Answer

According to the new growth theory, which of the following promote economic growth? i. Discoveries that bring profit. ii. Choices that expand human capital. iii. Random events that create technological change.

Correct AnswerverifiedShow Answer

The effect of an increase in labour productivity, assuming no change in the supply of labour, is i. an increase in the real wage. ii. an increase in potential GDP. iii. a decrease in the demand for labour.

Correct AnswerverifiedShow Answer

-Using the data in the table above, real GDP per person in 2009 is

Correct AnswerverifiedShow Answer

-The above figure shows a nation's production function. Point B is

Correct AnswerverifiedShow Answer

Sustained increases in the standard of living depend on

Correct AnswerverifiedShow Answer

For a household, the opportunity cost of not working is the

Correct AnswerverifiedShow Answer

As additional units of labour hours are employed, holding all other factors constant, along the production function,

Correct AnswerverifiedShow Answer

If real GDP in year 1 is $72 million and real GDP in year 2 is $87 million, then the growth rate of real GDP is

Correct AnswerverifiedShow Answer

One way to achieve faster growth in GDP per person is to increase the

Correct AnswerverifiedShow Answer

Economic freedom provides the

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified