Question 1

Over the last 140 years or so, on average Canada's real GDP per-person grew faster than that of the U.K.

Accepted Answer

A) True 
 B)False  True

Question 2

In the equation for the production function Y/L represents

Accepted Answer

A) productivity. 
B) output. 
C) the availability of natural resources. 
D) the amount of human capital. 
A) productivity. 
B) output. 
C) the availability of natural resources. 
D) the amount of human capital. A

Question 3

In which of the following cases can we be certain that a natural resource has become scarcer?

Accepted Answer

A) both the demand for the resource and the supply of the resource have increased 
B) both the demand for the resource and the supply of the resource have decreased 
C) demand for the resource is unchanged and the supply of the resource has increased 
D) the demand for the resource has decreased and the supply of the resource is unchanged 
A) both the demand for the resource and the supply of the resource have increased 
B) both the demand for the resource and the supply of the resource have decreased 
C) demand for the resource is unchanged and the supply of the resource has increased 
D) the demand for the resource has decreased and the supply of the resource is unchanged D

Question 4

Which of the following are residents of rich countries likely to have in greater quantities, or better quality, than residents of poor countries?

Accepted Answer

A) housing 
B) healthcare 
C) life expectancy 
D) All of the above. 
A) housing 
B) healthcare 
C) life expectancy 
D) All of the above.

Question 5

Suppose Japanese-based Toshiba Corporation builds and operates a new computer factory in the United States. Future production from such an investment would

Accepted Answer

A) increase U.S. GNP more than it would increase U.S. GDP. 
B) increase U.S. GDP more than it would increase U.S. GNP. 
C) not affect U.S. GNP, but would increase U.S. GDP. 
D) have no affect on U.S. GNP or GDP. 
A) increase U.S. GNP more than it would increase U.S. GDP. 
B) increase U.S. GDP more than it would increase U.S. GNP. 
C) not affect U.S. GNP, but would increase U.S. GDP. 
D) have no affect on U.S. GNP or GDP.

Question 6

Last year real GDP in the imaginary nation of Oceania was 561.0 billion and the population was 2.2 million. The year before, real GDP was 500.0 billion and the population was 2.0 million. What was the growth rate of real GDP per person during the year?

Accepted Answer

A) 12 percent 
B) 10 percent 
C) 4 percent 
D) 2 percent 
A) 12 percent 
B) 10 percent 
C) 4 percent 
D) 2 percent

Question 7

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

Accepted Answer

A) True 
 B)False

Question 8

Proprietary technology is knowledge that is

Accepted Answer

A) known but no longer used much. 
B) known, but only recently discovered. 
C) known mostly by only those in a certain profession. 
D) known only by the company that discovered it. 
A) known but no longer used much. 
B) known, but only recently discovered. 
C) known mostly by only those in a certain profession. 
D) known only by the company that discovered it.

Question 9

If a production function has constant returns to scale, then if all inputs double so does production.

Accepted Answer

A) True 
 B)False

Question 10

In recent decades Americans have increased their purchase of stocks of foreign-based companies. The Americans who have bought these stocks were engaged in

Accepted Answer

A) foreign portfolio investment. 
B) indirect domestic investment. 
C) foreign direct investment. 
D) foreign indirect investment. 
A) foreign portfolio investment. 
B) indirect domestic investment. 
C) foreign direct investment. 
D) foreign indirect investment.

Question 11

A country experiencing a growth rate of 8% per year can go from being one of the poorest to one of the richest in

Accepted Answer

A) one generation. In the last couple of decades China's growth rate has been higher than 8%. 
B) one generation. However, in the last couple of decades not even China's growth rate has been this high. 
C) three generations. In the last couple of decades China's growth rate has been higher than 8%. 
D) three generations. However, in the last couple of decades not even China's growth rate has been this high. 
A) one generation. In the last couple of decades China's growth rate has been higher than 8%. 
B) one generation. However, in the last couple of decades not even China's growth rate has been this high. 
C) three generations. In the last couple of decades China's growth rate has been higher than 8%. 
D) three generations. However, in the last couple of decades not even China's growth rate has been this high.

Question 12

Natural resources

Accepted Answer

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

Question 13

Suppose a country increases trade restrictions. This country would be pursing an

Accepted Answer

A) inward policy, which most economists believe has beneficial effects on the economy. 
B) inward policy, which most economists believe has adverse effects on the economy. 
C) outward policy, which most economists believe has beneficial effects on the economy. 
D) outward policy, which most economists believe has adverse effects on the economy. 
A) inward policy, which most economists believe has beneficial effects on the economy. 
B) inward policy, which most economists believe has adverse effects on the economy. 
C) outward policy, which most economists believe has beneficial effects on the economy. 
D) outward policy, which most economists believe has adverse effects on the economy.

Question 14

In the U.S., each additional year of schooling has historically raised a person's wage on average by about

Accepted Answer

A) 2 percent. 
B) 5 percent. 
C) 10 percent. 
D) 15 percent. 
A) 2 percent. 
B) 5 percent. 
C) 10 percent. 
D) 15 percent.

Question 15

Productivity is the amount of goods and services

Accepted Answer

A) an economy produces. It is not linked to a nation's economic policies. 
B) an economy produces. It is linked to a nation's economic policies. 
C) produced for each hour of a worker's time. It is not linked to a nation's economic policies. 
D) produced for each hour of a worker's time. It is linked to a nation's economic policies. 
A) an economy produces. It is not linked to a nation's economic policies. 
B) an economy produces. It is linked to a nation's economic policies. 
C) produced for each hour of a worker's time. It is not linked to a nation's economic policies. 
D) produced for each hour of a worker's time. It is linked to a nation's economic policies.

Question 16

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 output 
A) both output and productivity 
B) output, but not productivity 
C) productivity, but not output 
D) neither productivity nor output

Question 17

Haley discovers a new way to design automobile engines so that they use less gasoline. Haley's finding is an example of

Accepted Answer

A) physical capital. If Haley's discovery leads to lower gasoline prices, it has made gasoline less scarce. 
B) physical capital. If Haley's discovery leads to lower gasoline prices, it has made gasoline scarcer. 
C) technological knowledge. If Haley's discovery leads to lower gasoline prices, it has made gasoline less scarce. 
D) technological knowledge. If Haley's discovery leads to lower gasoline prices, it has made gasoline scarcer. 
A) physical capital. If Haley's discovery leads to lower gasoline prices, it has made gasoline less scarce. 
B) physical capital. If Haley's discovery leads to lower gasoline prices, it has made gasoline scarcer. 
C) technological knowledge. If Haley's discovery leads to lower gasoline prices, it has made gasoline less scarce. 
D) technological knowledge. If Haley's discovery leads to lower gasoline prices, it has made gasoline scarcer.

Question 18

Other things the same, higher population growth

Accepted Answer

A) raises the amount of physical capital per worker and there is some evidence that it raises the pace of technological progress. 
B) raises the amount of physical capital per worker, but there is some evidence that it reduces the pace of technological progress. 
C) reduces the amount of physical capital per worker, but there is some evidence that it raises the pace of technological progress. 
D) reduces the amount of physical capital per worker and there is some evidence that it reduces the pace of technological progress. 
A) raises the amount of physical capital per worker and there is some evidence that it raises the pace of technological progress. 
B) raises the amount of physical capital per worker, but there is some evidence that it reduces the pace of technological progress. 
C) reduces the amount of physical capital per worker, but there is some evidence that it raises the pace of technological progress. 
D) reduces the amount of physical capital per worker and there is some evidence that it reduces the pace of technological progress.

Question 19

A country with a relatively low level of real GDP per person is considering adopting two policies to promote economic growth. The first is to increase barriers to trade. The second is to restrict foreign portfolio investment. Which of these policies would most economist think would promote growth?

Accepted Answer

A) both the first and the second 
B) the first but not the second 
C) the second but not the first 
D) neither the first nor the second 
A) both the first and the second 
B) the first but not the second 
C) the second but not the first 
D) neither the first nor the second

Question 20

If natural resources had become scarcer, then we would expect their

Accepted Answer

A) prices to have risen more than inflation as they have. 
B) prices to have risen more than inflation, but they have not. 
C) known quantities to have fallen as they have. 
D) known quantities to have fallen but they have not. 
A) prices to have risen more than inflation as they have. 
B) prices to have risen more than inflation, but they have not. 
C) known quantities to have fallen as they have. 
D) known quantities to have fallen but they have not.

Exam 12: Production and Growth

Over the last 140 years or so, on average Canada's real GDP per-person grew faster than that of the U.K.

In the equation for the production function Y/L represents

In which of the following cases can we be certain that a natural resource has become scarcer?

Which of the following are residents of rich countries likely to have in greater quantities, or better quality, than residents of poor countries?

Suppose Japanese-based Toshiba Corporation builds and operates a new computer factory in the United States. Future production from such an investment would

Last year real GDP in the imaginary nation of Oceania was 561.0 billion and the population was 2.2 million. The year before, real GDP was 500.0 billion and the population was 2.0 million. What was the growth rate of real GDP per person during the year?

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

Proprietary technology is knowledge that is

If a production function has constant returns to scale, then if all inputs double so does production.

In recent decades Americans have increased their purchase of stocks of foreign-based companies. The Americans who have bought these stocks were engaged in

A country experiencing a growth rate of 8% per year can go from being one of the poorest to one of the richest in

Natural resources

Suppose a country increases trade restrictions. This country would be pursing an

In the U.S., each additional year of schooling has historically raised a person's wage on average by about

Productivity is the amount of goods and services

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?

Haley discovers a new way to design automobile engines so that they use less gasoline. Haley's finding is an example of

Other things the same, higher population growth

A country with a relatively low level of real GDP per person is considering adopting two policies to promote economic growth. The first is to increase barriers to trade. The second is to restrict foreign portfolio investment. Which of these policies would most economist think would promote growth?

If natural resources had become scarcer, then we would expect their

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, Demand, and Government Policies

Consumers, Producers, and the Efficiency of Markets

Application: The Costs of Taxation

Application: International Trade

Measuring a Nations Income

Measuring the Cost of Living

Saving, Investment, and the Financial System

The Basic Tools of Finance

Unemployment

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomic Models

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Trade-Off Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

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