Question 1

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) C) and D)
F) A) and B)

Question 2

In 8 hours,Sonja produces 8 units of goods and services.In 10 hours,Emma produces 9 units of goods and services.It follows that

Accepted Answer

A)   Sonja's productivity is higher than Emma's.
B)   Emma's productivity is higher than Sonja's.
C)   Emma's income per hour will be higher than Sonja's.
D)   Sonja's income per day will be higher than Emma's.E) C) and D)
F) B) and D)

Question 3

The logic behind the catch-up effect is that

Accepted Answer

A)   workers in countries with low incomes will work more hours than workers in countries with high incomes.
B)   the capital stock in rich countries deteriorates at a higher rate because it already has a lot of capital.
C)   new capital adds more to production in a country that doesn't have much capital than in a country that already has much capital.
D)   None of the above is correct.E) None of the above
F) A) and C)

Question 4

In 2006,the imaginary nation of Viloxia had a population of 5,000 and real GDP of 500,000.In 2007 it had a population of 5,100 and real GDP of 520,200.Over the year in question,real GDP per person in Viloxia grew by

Accepted Answer

A)   2 percent,which is high compared to average U.S.growth over the last one-hundred years.
B)   2 percent,which is about the same as average U.S.growth over the last one-hundred years.
C)   4 percent,which is high compared to average U.S.growth over the last one-hundred years.
D)   4 percent,which is about the same as average U.S.growth over the last one-hundred years.E) B) and D)
F) B) and C)

Question 5

Over the past 100 years,U.S.real GDP per person has doubled about every 35 years.If,in the next 100 years,it doubles every 25 years,then a century from now U.S.real GDP per person will be

Accepted Answer

A)   4 times higher than it is now.
B)   8 times higher than it is now.
C)   12 times higher than it is now.
D)   16 times higher than it is now.E) All of the above
F) A) and B)

Question 6

A barber shop produces 96 haircuts a day.Each barber in the shop works 8 hours per day and produces the same number of haircuts per hour.If the shop's productivity is 3 haircuts per hour of labor,then how many barbers does the shop employ?

Accepted Answer

A)   2
B)   3
C)   4
D)   6E) C) and D)
F) A) and C)

Question 7

An increase in capital increases productivity only if it is purchased and operated by domestic residents.

Accepted Answer

A) True 
 B)False

Question 8

In the long run,a higher saving rate

Accepted Answer

A)   cannot increase the capital stock.
B)   increases the growth rate of income.
C)   increases the growth rate of productivity.
D)   None of the above is correct.E) None of the above
F) A) and D)

Question 9

Rapid population growth

Accepted Answer

A)   was hailed by Thomas Robert Malthus as the key to future economic growth.
B)   tends to lead to higher levels of educational attainment.
C)   is the main reason that less developed nations are poor.
D)   may depress economic prosperity by reducing the amount of capital which each worker has to work with.E) All of the above
F) B) and D)

Question 10

In 2006,real GDP per person in Bangladesh was

Accepted Answer

A)   about 3 times as high as it was in the U.S.in 1870.
B)   about twice as high as it was in the U.S.in 1870.
C)   about the same as it was in the U.S.in 1870.
D)   less than it was in the U.S.in 1870.E) A) and B)
F) B) and C)

Question 11

In the United States,as measured by real GDP per person,average income is about how many times as high as average income a century ago?

Accepted Answer

A)   2
B)   4
C)   6
D)   8E) All of the above
F) A) and B)

Question 12

Use the data on U.S.real GDP below to compute real GDP per person for each year.Then use these numbers to compute the percentage increase in real GDP per person from 1987 to 2005.

Accepted Answer

Real GDP per person in 1987 wa...

Question 13

In a particular production process,if the quantities of all inputs used are increased by 60 percent,then the quantity of output increases by 60 percent as well.This means that

Accepted Answer

A)   the production process cannot be enhanced by technological advances.
B)   no mathematical representation of the relevant production function can be formulated.
C)   the relevant production function has the limits-to-growth property.
D)   the relevant production function has the constant-returns-to-scale property.E) A) and C)
F) B) and C)

Question 14

What is a production function? Write an equation for a typical production function,and explain what each of the terms represents.

Accepted Answer

A production function is a mathematical ...

Question 15

Why is productivity related to the standard of living? In your answer be sure to explain what productivity and standard of living mean.Make a list of things that determine labor productivity.

Accepted Answer

The standard of living is a measure of h...

Question 16

Human capital is the

Accepted Answer

A)   knowledge and skills that workers acquire through education,training,and experience.
B)   stock of equipment and structures that is used to produce goods and services.
C)   total number of hours worked in an economy.
D)   same thing as technological knowledge.E) A) and B)
F) C) and D)

Question 17

Which of the following items plays a role in determining productivity?

Accepted Answer

A)   physical capital
B)   natural resources
C)   technological knowledge
D)   All of the above are correct.E) A) and C)
F) All of the above

Question 18

Productivity

Accepted Answer

A)   is nearly the same across countries,and so provides no help explaining differences in the standard of living across countries.
B)   explains very little of the differences in the standard of living across countries.
C)   explains some,but not most of the differences in the standard of living across countries.
D)   explains most of the differences in the standard of living across countries.E) A) and D)
F) B) and D)

Question 19

Last year Panglossia had real GDP of 27.0 billion.This year it had real GDP of 31.5 billion.Which of the following changes in population is consistent with a 5 percent growth rate of real GDP per person over the last year?

Accepted Answer

A)   The population decreased from 88 million to 84 million.
B)   The population decreased from 75 million to 73 million.
C)   The population increased from 45 million to 50 million.
D)   The population increased from 60 million to 62 million.E) B) and D)
F) All of the above

Question 20

"When workers have a relatively small quantity of capital to use in producing goods and services,giving them an additional unit of capital increases their productivity by a relatively large amount." This statement

Accepted Answer

A)   is an assertion that production functions have the property of constant returns to scale.
B)   is consistent with the view that capital is subject to diminishing returns.
C)   is inconsistent with the view that it is easier for a country to grow fast if it starts out relatively poor.
D)   All of the above are correct.E) B) and C)
F) B) and D)

Exam 25: Production and Growth

In a particular production process,if the quantities of all inputs used are increased by 60 percent,then the quantity of output increases by 60 percent as well.This means that

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In the United States,as measured by real GDP per person,average income is about how many times as high as average income a century ago?

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Which of the following items plays a role in determining productivity?

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The logic behind the catch-up effect is that

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Rapid population growth

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Productivity

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Why is productivity related to the standard of living? In your answer be sure to explain what productivity and standard of living mean.Make a list of things that determine labor productivity.

Correct AnswerverifiedThe standard of living is a measure of h...View AnswerShow Answer

Last year Panglossia had real GDP of 27.0 billion.This year it had real GDP of 31.5 billion.Which of the following changes in population is consistent with a 5 percent growth rate of real GDP per person over the last year?

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In 2006,real GDP per person in Bangladesh was

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

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A barber shop produces 96 haircuts a day.Each barber in the shop works 8 hours per day and produces the same number of haircuts per hour.If the shop's productivity is 3 haircuts per hour of labor,then how many barbers does the shop employ?

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Human capital is the

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In the long run,a higher saving rate

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Over the past 100 years,U.S.real GDP per person has doubled about every 35 years.If,in the next 100 years,it doubles every 25 years,then a century from now U.S.real GDP per person will be

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Use the data on U.S.real GDP below to compute real GDP per person for each year.Then use these numbers to compute the percentage increase in real GDP per person from 1987 to 2005.

Correct AnswerverifiedReal GDP per person in 1987 wa...View AnswerShow Answer

In 2006,the imaginary nation of Viloxia had a population of 5,000 and real GDP of 500,000.In 2007 it had a population of 5,100 and real GDP of 520,200.Over the year in question,real GDP per person in Viloxia grew by

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"When workers have a relatively small quantity of capital to use in producing goods and services,giving them an additional unit of capital increases their productivity by a relatively large amount." This statement

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In 8 hours,Sonja produces 8 units of goods and services.In 10 hours,Emma produces 9 units of goods and services.It follows that

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An increase in capital increases productivity only if it is purchased and operated by domestic residents.

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What is a production function? Write an equation for a typical production function,and explain what each of the terms represents.

Correct AnswerverifiedA production function is a mathematical ...View AnswerShow Answer

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The standard of living is a measure of h...
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Real GDP per person in 1987 wa...
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A production function is a mathematical ...
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