Question 1

The measurement of output per worker is called:

Accepted Answer

A)   productivity.
B)   the production growth rate.
C)   nominal output.
D)   unemployment.E) B) and D)
F) B) and C)

Question 2

Which of the following is an example of physical capital?

Accepted Answer

A)   A factory
B)   A computer
C)   A pen
D)   All of these are examples of physical capital.E) A) and B)
F) None of the above

Question 3

Real income per person stayed relatively steady:

Accepted Answer

A)   until the 1800s, when the Industrial Revolution caused it to grow.
B)   until the 1500s, when the Renaissance caused it to grow.
C)   until the 1990s, when wireless technology caused it to grow.
D)   over the last three centuries.E) B) and D)
F) A) and B)

Question 4

Suppose that a country has a GDP of 1 trillion dollars in year 1. If the country grows at an average rate of 3 percent per year over a 15-year period, what will its compounded GDP be at the end of that time period?

Accepted Answer

A)   $1.47 trillion
B)   $2 trillion
C)   $1.33 trillion
D)   $1.56 trillionE) All of the above
F) A) and B)

Question 5

A country that alters the demographic of its workforce in a manner that increases the labor force, such as by raising the legal minimum retirement age, is likely to experience:

Accepted Answer

A)   a higher level of income.
B)   a sustainable, high income growth rate.
C)   more productive workers in all facets of the economy.
D)   All of these are true.E) C) and D)
F) A) and B)

Question 6

A nonrenewable resource:

Accepted Answer

A)   is a production input that does not naturally replenish when used.
B)   can be replenished naturally over time.
C)   is used to regenerate an old piece of capital.
D)   All of these are true.E) A) and D)
F) C) and D)

Question 7

Historically, real income per person:

Accepted Answer

A)   barely changed at all until the 1800s but began to increase after.
B)   barely changed at all until the 1500s but began to increase after.
C)   has steadily increased at an average rate of 2 percent
D)   has barely changed worldwide.E) B) and C)
F) None of the above

Question 8

A renewable resource:

Accepted Answer

A)   can be replenished naturally over time.
B)   is used to regenerate an old piece of capital.
C)   is any product that can be easily made in a factory using available resources.
D)   is not subject to trade restrictions.E) None of the above
F) B) and D)

Question 9

A phenomenon known as Moore's law says that:

Accepted Answer

A)   computing capacity doubles every two years.
B)   physical capital doubles every two years in countries with high rates of growth.
C)   the time it takes a country to double its income level can be calculated by dividing 70 by the growth rate.
D)   the time it takes a country to double its productive capacity can be calculated by dividing 70 by the growth rate.E) A) and B)
F) A) and C)

Question 10

The value of human capital can decrease when:

Accepted Answer

A)   someone forgets how to do something that was valuable in their work.
B)   the skills someone possesses are no longer needed.
C)   machines can be taught to do what people used to do.
D)   All of these can decrease human capital.E) B) and D)
F) A) and D)

Question 11

The productivity of workers can depend upon which of the following?

Accepted Answer

A)   Physical capital
B)   Population growth
C)   Number of businesses established
D)   All of these are determinants of productivity.E) None of the above
F) All of the above

Question 12

The productivity of workers can depend upon which of the following?

Accepted Answer

A)   Human capital
B)   Natural resources
C)   Technology
D)   All of these are determinants of productivity.E) A) and D)
F) None of the above

Question 13

After staying home for almost two decades to raise his children, Howard wants to go back to work in the TV repair business, which was his profession before becoming a stay-at-home parent. What can be said about Howard?

Accepted Answer

A)   After taking a break from the workforce, Howard will have higher human capital.
B)   Howard's knowledge of how to repair TVs is obsolete, and his human capital is less valuable now than it was before he became a stay-at-home parent.
C)   Howard's human capital has stayed constant; once gained, human capital cannot be lost.
D)   None of these are true about Howard.E) None of the above
F) C) and D)

Question 14

Economic growth means:

Accepted Answer

A)   more goods and services are produced.
B)   people maintain their standard of living.
C)   fewer goods are imported.
D)   tax revenues decrease in general.E) All of the above
F) B) and D)

Question 15

Savings that pay for capital investment can come from: domestic households. domestic firms. foreigners.

Accepted Answer

A)   I only
B)   I and III only
C)   I and II only
D)   I, II, and IIIE) B) and C)
F) A) and C)

Question 16

Some people attribute the rapid growth of the East Asian economies in the 1980s and 1990s to:

Accepted Answer

A)   the success of their "industrial policies."
B)   governments encouraging investment in certain industries with favorable tax and trade policies.
C)   government investment in certain industries as a plan for growth.
D)   All of these are true.E) B) and C)
F) B) and D)

Question 17

The investment trade-off:

Accepted Answer

A)   is a reduction in current consumption to pay for investment in capital intended to increase future production.
B)   explains why countries don't devote all their resources to consumption.
C)   defines the opportunity cost of capital investment.
D)   All of these are true.E) A) and C)
F) A) and B)

Question 18

Governments invest in infrastructure to:

Accepted Answer

A)   increase the productivity of businesses.
B)   spur economic growth.
C)   increase the growth rate of GDP per capita.
D)   All of these are reasons why governments invest in infrastructure.E) B) and C)
F) C) and D)

Question 19

If a country grows at an average rate of 3.5 percent per year, we can estimate it will double its:

Accepted Answer

A)   growth rate in 35 years.
B)   real GDP per capita in 35 years.
C)   real GDP per capita in 20 years.
D)   growth rate in 20 years.E) All of the above
F) B) and D)

Question 20

Which of the following would contribute to human capital?

Accepted Answer

A)   A firm expanding and creating 20 more jobs
B)   A firm offering on-the-job training for all workers
C)   A firm buying new machines to help workers be more productive
D)   All of these would contribute to human capital.E) A) and B)
F) C) and D)

Exam 10: Economicgrowth

The productivity of workers can depend upon which of the following?

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Historically, real income per person:

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The measurement of output per worker is called:

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Which of the following would contribute to human capital?

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The productivity of workers can depend upon which of the following?

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A nonrenewable resource:

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Suppose that a country has a GDP of 1 trillion dollars in year 1. If the country grows at an average rate of 3 percent per year over a 15-year period, what will its compounded GDP be at the end of that time period?

Correct AnswerverifiedShow Answer

A renewable resource:

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Economic growth means:

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Some people attribute the rapid growth of the East Asian economies in the 1980s and 1990s to:

Correct AnswerverifiedShow Answer

A phenomenon known as Moore's law says that:

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The investment trade-off:

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After staying home for almost two decades to raise his children, Howard wants to go back to work in the TV repair business, which was his profession before becoming a stay-at-home parent. What can be said about Howard?

Correct AnswerverifiedShow Answer

Savings that pay for capital investment can come from: domestic households. domestic firms. foreigners.

Correct AnswerverifiedShow Answer

Governments invest in infrastructure to:

Correct AnswerverifiedShow Answer

The value of human capital can decrease when:

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Real income per person stayed relatively steady:

Correct AnswerverifiedShow Answer

A country that alters the demographic of its workforce in a manner that increases the labor force, such as by raising the legal minimum retirement age, is likely to experience:

Correct AnswerverifiedShow Answer

If a country grows at an average rate of 3.5 percent per year, we can estimate it will double its:

Correct AnswerverifiedShow Answer

Which of the following is an example of physical capital?

Correct AnswerverifiedShow Answer

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