Question 1

In Canada,approximately how much higher is GDP per person today than it was a century ago?

Accepted Answer

A)  4 times higher 
B)  6 times higher 
C)  8 times higher 
D)  12 times higher 
A)  4 times higher 
B)  6 times higher 
C)  8 times higher 
D)  12 times higher

Question 2

If your Canadian-based firm opens and operates a new long board factory in Costa Rica,what type of investment is your firm engaging in?

Accepted Answer

A)  foreign portfolio investment 
B)  foreign financial investment 
C)  foreign direct investment 
D)  foreign capital investment 
A)  foreign portfolio investment 
B)  foreign financial investment 
C)  foreign direct investment 
D)  foreign capital investment

Question 3

When a country removes trade barriers and exports pork chops and imports stereos,what will most likely happen?

Accepted Answer

A)  Its growth will slow down. 
B)  Its productivity will decrease. 
C)  It will essentially be transforming pork chops into stereos. 
D)  Its economic well-being will decrease,while that of the country that sells stereos will increase. 
A)  Its growth will slow down. 
B)  Its productivity will decrease. 
C)  It will essentially be transforming pork chops into stereos. 
D)  Its economic well-being will decrease,while that of the country that sells stereos will increase.

Question 4

According to the traditional view of the production process,how does output per worker change when capital per worker increases?

Accepted Answer

A)  It increases.This increase is larger at larger values of capital per worker. 
B)  It increases.This increase is smaller at larger values of capital per worker. 
C)  It increases.This increase is the same at all values of capital per worker. 
D)  It decreases.This decrease is larger at larger values of capital per worker. 
A)  It increases.This increase is larger at larger values of capital per worker. 
B)  It increases.This increase is smaller at larger values of capital per worker. 
C)  It increases.This increase is the same at all values of capital per worker. 
D)  It decreases.This decrease is larger at larger values of capital per worker.

Question 5

Last year,real GDP in Oceania was $620 billion and the population was 2.3 million.The year before,real GDP was $502 billion and the population was 2.0 million.What was the approximate growth rate of real GDP per person?

Accepted Answer

A)  3 percent 
B)  7 percent 
C)  10 percent 
D)  17 percent 
A)  3 percent 
B)  7 percent 
C)  10 percent 
D)  17 percent

Question 6

What indicates greater scarcity of a natural resource?

Accepted Answer

A)  an increase in its demand 
B)  a decrease in its supply 
C)  an increase in its price 
D)  a decrease in its stock 
A)  an increase in its demand 
B)  a decrease in its supply 
C)  an increase in its price 
D)  a decrease in its stock

Question 7

Which of the following is considered human capital?

Accepted Answer

A)  breakfasts served in a company's cafeteria 
B)  shovels used by a tree planting business 
C)  an apprentice mechanic working in an auto repair shop 
D)  the average number of holiday days per year 
A)  breakfasts served in a company's cafeteria 
B)  shovels used by a tree planting business 
C)  an apprentice mechanic working in an auto repair shop 
D)  the average number of holiday days per year

Question 8

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

Accepted Answer

A)  raise real GDP per person but decrease real GDP 
B)  decrease both real GDP and real GDP per person 
C)  raise both real GDP and real GDP per person 
D)  raise real GDP but decrease real GDP per person 
A)  raise real GDP per person but decrease real GDP 
B)  decrease both real GDP and real GDP per person 
C)  raise both real GDP and real GDP per person 
D)  raise real GDP but decrease real GDP per person

Question 9

Which statement best describe the relationship between productivity and standard of living?

Accepted Answer

A)  International trade makes a country's productivity irrelevant. 
B)  A country's standard of living and its productivity are closely related. 
C)  Productivity only increases revenue to investors,while general well-being is not affected. 
D)  A rich country can enjoy a high standard of living without the need for high productivity. 
A)  International trade makes a country's productivity irrelevant. 
B)  A country's standard of living and its productivity are closely related. 
C)  Productivity only increases revenue to investors,while general well-being is not affected. 
D)  A rich country can enjoy a high standard of living without the need for high productivity.

Question 10

Why are property rights important for the growth of a nation's standard of living?

Accepted Answer

Property rights are an important prerequ

Question 11

Which statement best explains the logic behind the catch-up effect?

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)  Poor countries tend to save a higher share of their income than rich countries. 
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)  Poor countries tend to save a higher share of their income than rich countries.

Question 12

Which situation is an example of the "brain drain"?

Accepted Answer

A)  A country's most highly educated workers immigrate to rich countries. 
B)  A country has such a poor educational system that knowledge is lost over time. 
C)  A country's population grows so fast that the educational system can't keep up. 
D)  A country steals patented technology from another country. 
A)  A country's most highly educated workers immigrate to rich countries. 
B)  A country has such a poor educational system that knowledge is lost over time. 
C)  A country's population grows so fast that the educational system can't keep up. 
D)  A country steals patented technology from another country.

Question 13

Which country benefitted a lot from the catch-up effect in the last half of the twentieth century?

Accepted Answer

A)  Ethiopia 
B)  Saudi Arabia 
C)  South Korea 
D)  Ireland 
A)  Ethiopia 
B)  Saudi Arabia 
C)  South Korea 
D)  Ireland

Question 14

Read the article "Are jobs obsolete?" by Douglas Rushkoff,Special to CNN September 7,2011 (http: / / goo.gl / 0aUXL).
a)What are the main points of the article?
b)One of the principles of economics is that a country's standard of living depends on the country's ability to produce goods and services,while one of the main points of the article suggests that productivity is no longer a goal in the U.S.because the American economy is already able to produce enough for all its people.Does the author's opinion contradict the economic principle?
c)Economic theory suggests that technological innovation is an important factor of economic growth.The article,on the other hand,opines that new technologies destroy more jobs than they create.Is this statement true? (Look for extra information that might or might not support this statement.)Does this statement contradict economic theory?

Accepted Answer

The answers depend on students

Question 15

Other things the same,if a country increased its saving rate what would that country likely have in 40 years?

Accepted Answer

A)  higher productivity and a higher growth rate of real GDP 
B)  higher productivity but not a higher growth rate of real GDP 
C)  the same productivity and growth of real GDP it began with 
D)  higher productivity growth rate and higher real GDP 
A)  higher productivity and a higher growth rate of real GDP 
B)  higher productivity but not a higher growth rate of real GDP 
C)  the same productivity and growth of real GDP it began with 
D)  higher productivity growth rate and higher real GDP

Question 16

What type of investment has foreigners buying shares in domestic companies?

Accepted Answer

A)  foreign direct investment 
B)  foreign portfolio investment 
C)  foreign capital investment 
D)  foreign indirect investment 
A)  foreign direct investment 
B)  foreign portfolio investment 
C)  foreign capital investment 
D)  foreign indirect investment

Question 17

All else equal,which of the following would tend to cause GDP per person to rise?

Accepted Answer

A)  high immigration growth 
B)  investment in human capital 
C)  rapid growth in the labour force population 
D)  policies to reduce imports 
A)  high immigration growth 
B)  investment in human capital 
C)  rapid growth in the labour force population 
D)  policies to reduce imports

Question 18

Using the production function and notation in the text,what does K / L measure?

Accepted Answer

A)  average wages per worker 
B)  human capital per worker 
C)  output per worker 
D)  physical capital per worker 
A)  average wages per worker 
B)  human capital per worker 
C)  output per worker 
D)  physical capital per worker

Question 19

What would we expect to happen with prices or quantities of natural resources if they were becoming scarcer?

Accepted Answer

A)  We would expect prices to be rising relative to other prices,as they have been. 
B)  We would expect prices to be rising relative to other prices,but this has not occurred. 
C)  We would expect known quantities to be increasing,as they have been. 
D)  We would expect known quantities to be falling,but this has not occurred. 
A)  We would expect prices to be rising relative to other prices,as they have been. 
B)  We would expect prices to be rising relative to other prices,but this has not occurred. 
C)  We would expect known quantities to be increasing,as they have been. 
D)  We would expect known quantities to be falling,but this has not occurred.

Question 20

Investment in both human and physical capital has opportunity costs.

Accepted Answer

A) True 
 B)False

In Canada,approximately how much higher is GDP per person today than it was a century ago?

If your Canadian-based firm opens and operates a new long board factory in Costa Rica,what type of investment is your firm engaging in?

When a country removes trade barriers and exports pork chops and imports stereos,what will most likely happen?

According to the traditional view of the production process,how does output per worker change when capital per worker increases?

Last year,real GDP in Oceania was $620 billion and the population was 2.3 million.The year before,real GDP was $502 billion and the population was 2.0 million.What was the approximate growth rate of real GDP per person?

What indicates greater scarcity of a natural resource?

Which of the following is considered human capital?

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

Which statement best describe the relationship between productivity and standard of living?

Why are property rights important for the growth of a nation's standard of living?

Which statement best explains the logic behind the catch-up effect?

Which situation is an example of the "brain drain"?

Which country benefitted a lot from the catch-up effect in the last half of the twentieth century?

Other things the same,if a country increased its saving rate what would that country likely have in 40 years?

What type of investment has foreigners buying shares in domestic companies?

All else equal,which of the following would tend to cause GDP per person to rise?

Using the production function and notation in the text,what does K / L measure?

What would we expect to happen with prices or quantities of natural resources if they were becoming scarcer?

Investment in both human and physical capital has opportunity costs.

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Measuring a Nations Income

Measuring the Cost of Living

Saving, investment, and the Financial System

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Small Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Five Debates Over Macroeconomic Policy

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Exam 7: Production and Growth

In Canada,approximately how much higher is GDP per person today than it was a century ago?

If your Canadian-based firm opens and operates a new long board factory in Costa Rica,what type of investment is your firm engaging in?

When a country removes trade barriers and exports pork chops and imports stereos,what will most likely happen?

According to the traditional view of the production process,how does output per worker change when capital per worker increases?

Last year,real GDP in Oceania was $620 billion and the population was 2.3 million.The year before,real GDP was $502 billion and the population was 2.0 million.What was the approximate growth rate of real GDP per person?

What indicates greater scarcity of a natural resource?

Which of the following is considered human capital?

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

Which statement best describe the relationship between productivity and standard of living?

Why are property rights important for the growth of a nation's standard of living?

Which statement best explains the logic behind the catch-up effect?

Which situation is an example of the "brain drain"?

Which country benefitted a lot from the catch-up effect in the last half of the twentieth century?

Other things the same,if a country increased its saving rate what would that country likely have in 40 years?

What type of investment has foreigners buying shares in domestic companies?

All else equal,which of the following would tend to cause GDP per person to rise?

Using the production function and notation in the text,what does K / L measure?

What would we expect to happen with prices or quantities of natural resources if they were becoming scarcer?

Investment in both human and physical capital has opportunity costs.

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Measuring a Nations Income

Measuring the Cost of Living

Saving, investment, and the Financial System

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Small Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Five Debates Over Macroeconomic Policy

Filters