Question 1

The positive slope of the per-worker production function illustrates the relationship between per-worker output and ________.

Accepted Answer

A) diminishing marginal returns 
B) the capital-labor ratio 
C) the rate of inflation 
D) the rate of unemployment 
A) diminishing marginal returns 
B) the capital-labor ratio 
C) the rate of inflation 
D) the rate of unemployment B

Question 2

The slowdown in U.S.economic growth in the period 1974-95 was primarily caused by ________.

Accepted Answer

A) falling labor growth 
B) falling capital growth 
C) falling productivity growth 
D) none of the above 
A) falling labor growth 
B) falling capital growth 
C) falling productivity growth 
D) none of the above C

Question 3

If the contribution from capital and labor growth in a given economy equals 4.0 percent and output growth equals 6.4 percent over that same period of time,then productivity growth must equal ________.

Accepted Answer

A) 25.6 percent 
B) 10.4 percent 
C) 2.4 percent 
D) 1.6 percent 
A) 25.6 percent 
B) 10.4 percent 
C) 2.4 percent 
D) 1.6 percent C

Question 4

The label 'Asian Tigers' describes the following economies ________.

Accepted Answer

A) China,South Korea,Singapore and Taiwan 
B) Hong Kong,Taiwan,South Korea and Singapore 
C) Singapore,Taiwan,Hong Kong,and China 
D) South Korea,Singapore,China and Hong Kong 
A) China,South Korea,Singapore and Taiwan 
B) Hong Kong,Taiwan,South Korea and Singapore 
C) Singapore,Taiwan,Hong Kong,and China 
D) South Korea,Singapore,China and Hong Kong

Question 5

Other things the same,in the Solow model in the steady state,a higher rate of population growth ________ growth rate of output.

Accepted Answer

A) leads to a higher 
B) leads to a lower 
C) has no long-run effect on the 
D) has an ambiguous effect on the 
A) leads to a higher 
B) leads to a lower 
C) has no long-run effect on the 
D) has an ambiguous effect on the

Question 6

Other things the same,in the Solow model in the steady state,a higher rate of population growth ________ growth rate of output per worker.

Accepted Answer

A) leads to a higher 
B) leads to a lower 
C) has no long-run effect on the 
D) has an ambiguous effect on the 
A) leads to a higher 
B) leads to a lower 
C) has no long-run effect on the 
D) has an ambiguous effect on the

Question 7

Following an increase in the saving rate,consumption per worker ________.

Accepted Answer

A) increases 
B) decreases 
C) is unaffected 
D) may either rise or fall 
A) increases 
B) decreases 
C) is unaffected 
D) may either rise or fall

Question 8

Evidence that convergence occurs within economies is drawn in part from the example of ________.

Accepted Answer

A) Hiroshima and Nagasaki Japan 
B) North and South Korea 
C) West and East Germany during the Cold War 
D) Hong Kong and Singapore 
A) Hiroshima and Nagasaki Japan 
B) North and South Korea 
C) West and East Germany during the Cold War 
D) Hong Kong and Singapore

Question 9

If productivity growth equals 3.0 percent,the contribution from capital growth 1.2 percent and the contribution from labor growth 2.0 percent,then output growth must equal ________.

Accepted Answer

A) 2.2 percent 
B) 4.2 percent 
C) 6.2 percent 
D) 7.2 percent 
A) 2.2 percent 
B) 4.2 percent 
C) 6.2 percent 
D) 7.2 percent

Question 10

In a steady-state economy with no population growth,consumption per worker is 45,the saving rate is 25 percent,and the depreciation rate is 15 percent.The level of capital per worker is ________.

Accepted Answer

A) 75 
B) 36 
C) 100 
D) 27 
A) 75 
B) 36 
C) 100 
D) 27

Question 11

In the bathtub analogy,which of the following is a stock variable?

Accepted Answer

A) the amount of investment 
B) the rate of depreciation 
C) the amount of capital-per worker 
D) the Cobb-Douglass value 
A) the amount of investment 
B) the rate of depreciation 
C) the amount of capital-per worker 
D) the Cobb-Douglass value

Question 12

In the typical bathtub,the flow of water into the tub is controlled by a faucet independently of the quantity of water in the tub.How is the bathtub analogy of the steady state in the Solow model different? How does this difference relate to the phenomenon of convergence?

Accepted Answer

In the Solow model,the flow of investmen

Question 13

With a closed economy and no government spending,the total demand for output is equal to ________.

Accepted Answer

A) consumption per-worker plus investment per-worker 
B) consumption per-worker minus investment per-worker 
C) consumption per-worker times investment per-worker 
D) consumption per worker divided by investment per-worker 
A) consumption per-worker plus investment per-worker 
B) consumption per-worker minus investment per-worker 
C) consumption per-worker times investment per-worker 
D) consumption per worker divided by investment per-worker

Question 14

Countries with different initial levels of per capita income may gravitate to a similar level of per capita income.Economists call this phenomenon ________.

Accepted Answer

A) convergence 
B) simulation 
C) gravitation 
D) depreciation 
A) convergence 
B) simulation 
C) gravitation 
D) depreciation

Question 15

When an economy experiences a one-time increase in productivity,there is an immediate increase in ________.

Accepted Answer

A) the saving rate 
B) the capital-labor ratio 
C) the depreciation rate 
D) consumption per worker 
A) the saving rate 
B) the capital-labor ratio 
C) the depreciation rate 
D) consumption per worker

Question 16

A One-Child Policy was instituted in 1979 in ________.

Accepted Answer

A) Brazil 
B) South Africa 
C) India 
D) China 
A) Brazil 
B) South Africa 
C) India 
D) China

Question 17

Solow Diagram  
-The diagram above shows a steady state with a constant quantity of labor.Show on the graph how the steady state is determined if the labor force is growing at some constant rate.On the graph,show how to measure the change in consumption per worker that results from growth of the labor force.

Accepted Answer

To show how the steady state is determin

Question 18

National output is a function of ________.

Accepted Answer

A) capital and saving 
B) technology,employment and demand 
C) labor and depreciation 
D) labor,technology and capital 
A) capital and saving 
B) technology,employment and demand 
C) labor and depreciation 
D) labor,technology and capital

Question 19

Capital and labor are distinct from productivity in that ________.

Accepted Answer

A) productivity is independent of technology changes 
B) productivity can only increase over time 
C) productivity is subject to diminishing returns 
D) capital and labor are subject to diminishing marginal returns 
A) productivity is independent of technology changes 
B) productivity can only increase over time 
C) productivity is subject to diminishing returns 
D) capital and labor are subject to diminishing marginal returns

Question 20

In a closed economy ________.

Accepted Answer

A) investment equals consumption 
B) investment equals savings 
C) saving equals consumption 
D) exports are greater than imports 
A) investment equals consumption 
B) investment equals savings 
C) saving equals consumption 
D) exports are greater than imports

Exam 6: The Sources of Growth and the Solow Model

The positive slope of the per-worker production function illustrates the relationship between per-worker output and ________.

The slowdown in U.S.economic growth in the period 1974-95 was primarily caused by ________.

If the contribution from capital and labor growth in a given economy equals 4.0 percent and output growth equals 6.4 percent over that same period of time,then productivity growth must equal ________.

The label 'Asian Tigers' describes the following economies ________.

Other things the same,in the Solow model in the steady state,a higher rate of population growth ________ growth rate of output.

Other things the same,in the Solow model in the steady state,a higher rate of population growth ________ growth rate of output per worker.

Following an increase in the saving rate,consumption per worker ________.

Evidence that convergence occurs within economies is drawn in part from the example of ________.

If productivity growth equals 3.0 percent,the contribution from capital growth 1.2 percent and the contribution from labor growth 2.0 percent,then output growth must equal ________.

In a steady-state economy with no population growth,consumption per worker is 45,the saving rate is 25 percent,and the depreciation rate is 15 percent.The level of capital per worker is ________.

In the bathtub analogy,which of the following is a stock variable?

In the typical bathtub,the flow of water into the tub is controlled by a faucet independently of the quantity of water in the tub.How is the bathtub analogy of the steady state in the Solow model different? How does this difference relate to the phenomenon of convergence?

With a closed economy and no government spending,the total demand for output is equal to ________.

Countries with different initial levels of per capita income may gravitate to a similar level of per capita income.Economists call this phenomenon ________.

When an economy experiences a one-time increase in productivity,there is an immediate increase in ________.

A One-Child Policy was instituted in 1979 in ________.

National output is a function of ________.

Capital and labor are distinct from productivity in that ________.

In a closed economy ________.

The Policy and Practice of Macroeconomics

Measuring Macroeconomic Data

Aggregate Production and Productivity

Saving and Investment in Closed and Open Economies

Money and Inflation

Drivers of Growth: Technology, policy, and Institutions

Business Cycles: an Introduction

The Is Curve

Monetary Policy and Aggregate Demand

Aggregate Supply and the Phillips Curve

The Aggregate Demand and Supply Model

Macroeconomic Policy and Aggregate Demand and Supply Analysis

The Financial System and Economic Growth

Financial Crises and the Economy

Fiscal Policy and the Government Budget

Exchange Rates and International Economic Policy

Consumption and Saving

Investment

The Labor Market, employment, and Unemployment

The Role of Expectations in Macroeconomic Policy

Modern Business Cycle Theory

Filters