Question 1

Which of the following does NOT qualify as physical capital?

Accepted Answer

A)  shovel
B)  factory
C)  backhoe
D)  mineral deposits

Question 2

Suppose that fossil fuels become scarcer and scarcer in the next 50 years. With a growing global demand for energy and the looming threat of rising global temperatures, it would seem to be a recipe for a dramatic decrease in the growth rate of economic activity. Why do many economists believe that economies can continue to grow even in the face of resource scarcity?

Accepted Answer

As fossil fuels become scarcer, prices w...

Question 3

From the standpoint of economic growth, banks are important to:

Accepted Answer

A)  fight inflation.
B)  keep interest rates low.
C)  channel savings into investment.
D)  channel investment into savings.

Question 4

Which sector is responsible for most of the growth in the United States during the 1990s?

Accepted Answer

A)  service
B)  manufacturing
C)  mining
D)  retail

Question 5

Real GDP per capita in the United States increased almost _____ times between 1900 and 2010.

Accepted Answer

A)  2
B)  3
C)  8
D)  10

Question 6

The key measure used to track economic growth is:

Accepted Answer

A)  real GDP per capita.
B)  nominal GDP.
C)  real GDP.
D)  nominal GDP per capita.

Question 7

Long-run economic growth depends almost entirely on rising productivity.

Accepted Answer

A) True 
 B)False

Question 8

Diminishing returns to physical capital suggests that:

Accepted Answer

A)  when the amount of human capital per worker and the state of technology are fixed, successive increases in the amount of physical capital per worker lead to smaller increases in productivity.
B)  physical capital increases lead to drops in productivity when the amount of human capital per worker and the state of technology are fixed.
C)  increases in technological progress lead to decreases in productivity.
D)  physical capital must be increased less than human capital and technological progress for growth to occur.

Question 9

Investment spending:

Accepted Answer

A)  must be paid for by consumption in domestic households.
B)  comes from the savings of either domestic or foreign households.
C)  is paid for by capital outflows.
D)  must be paid for by government spending.

Question 10

Total factor productivity is the amount of output that can be achieved with a given amount of factor inputs.

Accepted Answer

A) True 
 B)False

Question 11

Labor productivity growth can be attributed to:

Accepted Answer

A)  improvement in technology.
B)  a decline in university attendance.
C)  an increase in population growth.
D)  a decline in the physical capital per worker.

Question 12

If real GDP grows at an annual rate of 1%, it will double in approximately _____ years.

Accepted Answer

A)  11
B)  23
C)  35
D)  70

Question 13

Fifty years ago East Asia, Latin America, and Africa were all relatively poor areas. Why did East Asia have fairly rapid growth in real GDP per capita while economic growth in Latin America and Africa was generally low?

Accepted Answer

In East Asia worker productivity has inc...

Question 14

The East Asian countries have exhibited tremendous economic growth during the past 40 years because of all of the following EXCEPT:

Accepted Answer

A)  a significant increase in physical capital per worker made possible by very high rate of saving.
B)  a significant increase in human capital made possible by very good basic education.
C)  a substantial achievement in technological progress.
D)  intervening governments with lots of regulations.

Question 15

One of the most important types of infrastructure that a government can provide is:

Accepted Answer

A)  a good tax system.
B)  basic health measures such as clean water and disease control.
C)  the kind that private companies would provide if they were allowed to.
D)  more intervention in the market mechanism.

Question 16

The improvement in labor made possible by education and knowledge that is embodied in the work force is known as _____ capital.

Accepted Answer

A)  physical
B)  human
C)  financial
D)  real

Question 17

An example of a public good that encourages economic growth is public health services, such as vaccinations.

Accepted Answer

A) True 
 B)False

Question 18

Use the following to answer questions :
Scenario: Productivity
The economy has grown by 4% per year over the past 30 years. During the same period the labor force has grown by 1% per year and the quantity of physical capital has grown by 5% per year. Each 1% increase in physical capital per worker is estimated to increase productivity by 0.4%. Assume that human capital has not changed during the past 30 years.
-(Scenario: Productivity)  Look at the scenario Productivity. How fast has physical capital per worker grown?

Accepted Answer

A)  5%
B)  4%
C)  3%
D)  2%

Question 19

Workers today are more productive than workers in the past because:

Accepted Answer

A)  they now are physically stronger on average.
B)  they now have more physical capital embodying better technology.
C)  more of them use the same number of machines as in the past.
D)  they are paid more.

Question 20

The convergence hypothesis says that international differences in real GDP per capita tend to increase over time.

Accepted Answer

A) True 
 B)False

Exam 9: Long-Run Economic Growth

Long-run economic growth depends almost entirely on rising productivity.

Correct Answer
verified

The key measure used to track economic growth is:

Correct Answer
verified

Labor productivity growth can be attributed to:

Correct Answer
verified

Investment spending:

Correct Answer
verified

Which sector is responsible for most of the growth in the United States during the 1990s?

Correct Answer
verified

The improvement in labor made possible by education and knowledge that is embodied in the work force is known as _____ capital.

Correct Answer
verified

The East Asian countries have exhibited tremendous economic growth during the past 40 years because of all of the following EXCEPT:

Correct Answer
verified

An example of a public good that encourages economic growth is public health services, such as vaccinations.

Correct Answer
verified

Correct Answer
verified

If real GDP grows at an annual rate of 1%, it will double in approximately _____ years.

Correct Answer
verified

Workers today are more productive than workers in the past because:

Correct Answer
verified

Fifty years ago East Asia, Latin America, and Africa were all relatively poor areas. Why did East Asia have fairly rapid growth in real GDP per capita while economic growth in Latin America and Africa was generally low?

Correct Answer
verified
In East Asia worker productivity has inc...
View Answer

Diminishing returns to physical capital suggests that:

Correct Answer
verified

Total factor productivity is the amount of output that can be achieved with a given amount of factor inputs.

Correct Answer
verified

Correct Answer
verified
As fossil fuels become scarcer, prices w...
View Answer

From the standpoint of economic growth, banks are important to:

Correct Answer
verified

Which of the following does NOT qualify as physical capital?

Correct Answer
verified

One of the most important types of infrastructure that a government can provide is:

Correct Answer
verified

The convergence hypothesis says that international differences in real GDP per capita tend to increase over time.

Correct Answer
verified

Real GDP per capita in the United States increased almost _____ times between 1900 and 2010.

Correct Answer
verified

Exam 9: Long-Run Economic Growth

Long-run economic growth depends almost entirely on rising productivity.

Correct AnswerverifiedShow Answer

The key measure used to track economic growth is:

Correct AnswerverifiedShow Answer

Labor productivity growth can be attributed to:

Correct AnswerverifiedShow Answer

Investment spending:

Correct AnswerverifiedShow Answer

Which sector is responsible for most of the growth in the United States during the 1990s?

Correct AnswerverifiedShow Answer

The improvement in labor made possible by education and knowledge that is embodied in the work force is known as _____ capital.

Correct AnswerverifiedShow Answer

The East Asian countries have exhibited tremendous economic growth during the past 40 years because of all of the following EXCEPT:

Correct AnswerverifiedShow Answer

An example of a public good that encourages economic growth is public health services, such as vaccinations.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

If real GDP grows at an annual rate of 1%, it will double in approximately _____ years.

Correct AnswerverifiedShow Answer

Workers today are more productive than workers in the past because:

Correct AnswerverifiedShow Answer

Fifty years ago East Asia, Latin America, and Africa were all relatively poor areas. Why did East Asia have fairly rapid growth in real GDP per capita while economic growth in Latin America and Africa was generally low?

Correct AnswerverifiedIn East Asia worker productivity has inc...View AnswerShow Answer

Diminishing returns to physical capital suggests that:

Correct AnswerverifiedShow Answer

Total factor productivity is the amount of output that can be achieved with a given amount of factor inputs.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedAs fossil fuels become scarcer, prices w...View AnswerShow Answer

From the standpoint of economic growth, banks are important to:

Correct AnswerverifiedShow Answer

Which of the following does NOT qualify as physical capital?

Correct AnswerverifiedShow Answer

One of the most important types of infrastructure that a government can provide is:

Correct AnswerverifiedShow Answer

The convergence hypothesis says that international differences in real GDP per capita tend to increase over time.

Correct AnswerverifiedShow Answer

Real GDP per capita in the United States increased almost _____ times between 1900 and 2010.

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
In East Asia worker productivity has inc...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
As fossil fuels become scarcer, prices w...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified