Exam 7: Production and Growth

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

Which of the following best describes the evolution of productivity growth in Canada?

Some civil society groups and activists propose a zero-economic-growth policy in order to preserve the environment. Write an essay to discuss the pros and cons of this proposal. You may wish to refer, among other ideas, to the following: - Economic growth needs to compensate for the increase in population. - If population becomes older, the number of active persons decreases; therefore, productivity must increase to sustain a high standard of living. - An increase in standard of living is only possible if an economy becomes more productive (income per person is closely related to labour productivity). - It is hoped that economic growth will eventually eradicate poverty. - Economic measures of well-being, such as GDP per capita, are imperfect mainly because they disregard external costs of economic activity, as well as other aspects of life that people value, such as leisure, fairness, and income equality.

In 2007 Freedonia had a population of 2700 and real GDP of about $1 080 000. In 2006 it had a population of 2500 and real GDP of about $1 000 000. What was the approximate growth rate of real GDP per person in Freedonia between 2006 and 2007?

Which of the following is human capital?

Compare and contrast the population theories of Malthus and Kremer.

Productivity can be found as number of hours worked divided by output.

Which of the following is an effect of inward-oriented policies?

Although growth rates across countries vary, rankings of countries by income remain pretty much the same over time.

What will a rapid increase in the number of workers, other things the same, likely do in the short term?

A country without a lot of domestic natural resources can have a high standard of living.

A leading environmental group recently published a report contending that humans are running a "resource deficit" because we are using natural resources faster than they can be regenerated. The group claims that this means that economic growth will eventually stop, and will even be reversed. How would an economist respond to this report?

If a country's saving rate increases, which of the following happens in the long run?

If your firm has constant returns to scale, what would happen to your firm's output if you doubled all your inputs?

Which of the following is generally an opportunity cost of investment in human capital?

The purpose of this problem is to make you acquainted with Statistics Canada's web site. Open _{HYPERLINK "http://www.statcan.gc.ca/start-debut-eng.html"} http://www.statcan.gc.ca/start-debut-eng.html and look for Economic Account, then open the link "Gross Domestic Product" page. Open "Summary Tables," then open the table "Real Gross Domestic Product, Expenditure-Based, by Province and Territory." Answer the following questions based on this table. a.Which three provinces had the greatest real GDP per capita in 2008? b.Calculate the shares of each of these provinces in Canada's real GDP in 2008. c.Now, look for another table (you can use the "Search" function), "Consumer price index, historical summary, by province or territory." In which province was the consumer price index the highest in each of the years 2006 to 2009? Can you think of an explanation for that?

Which of the following is an effect of outward-oriented policies?

Your company discovers a better way to produce mousetraps, but your better methods are not apparent from the mousetraps themselves. What kind of knowledge is this?

Which of the following statements best characterizes the variations in real GDP per person and its rate of growth across countries?

Which of the following has been happening to the market prices of most natural resources (adjusted for inflation)?