Question 1

Which of the following is an example of human capital?

Accepted Answer

A)   textbooks
B)   hand held power tools
C)   knowing how to repair cars
D)   All of the above are correct.E) None of the above
F) All of the above

Question 2

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

Accepted Answer

A) True 
 B)False

Question 3

Which of the following pairs of countries experienced approximately the same rate of growth of real income per person over about the last 120 years?

Accepted Answer

A)   Germany and Japan
B)   Indonesia and Bangladesh
C)   the United States and Argentina
D)   Mexico and PakistanE) A) and B)
F) B) and D)

Question 4

Which of the following statements is not correct?

Accepted Answer

A)   The catch-up effect is based on the assumption of diminishing returns to capital.
B)   Investment in poor countries by citizens of rich countries is one way poor countries can learn new technologies.
C)   Malthus argued that charity and government aid was an effective way to reduce poverty.
D)   Peace and justice are keys to growth.E) B) and D)
F) All of the above

Question 5

Investment in

Accepted Answer

A)   physical capital, unlike investment in human capital, has an opportunity cost.
B)   physical capital, like investment in human capital, has an opportunity cost.
C)   human capital is particularly attractive because it involves no externalities.
D)   human capital has been shown to be relatively unimportant, relative to investment in physical capital, for a country's long­run economic success.E) A) and D)
F) All of the above

Question 6

The catch-up effect refers to the idea that poor countries, despite their best efforts, are not likely ever to experience the economic growth rates of wealthier countries.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following is an example of a renewable natural resource?

Accepted Answer

A)   fish
B)   soybeans
C)   wood
D)   All of the above are correct.E) None of the above
F) A) and B)

Question 8

Two countries with the same saving rates must have the same growth rate of real GDP per person.

Accepted Answer

A) True 
 B)False

Question 9

In 2011, Modern Electronics, Inc. produced 60,000 calculators, employing 80 workers, each of whom worked 8 hours per day. In 2012, the same firm produced 76,500 calculators, employing 85 workers, each of whom worked 10 hours per day. Productivity at Modern Electronics

Accepted Answer

A)   decreased by 4%
B)   remained constant.
C)   increased by 8.33%
D)   increased by 27.50%E) None of the above
F) A) and D)

Question 10

If a country's saving rate declined, then other things the same, in the long run the country would have

Accepted Answer

A)   lower productivity, but not lower real GDP per person.
B)   lower productivity and lower real GDP per person.
C)   lower real GDP per person, but not lower productivity
D)   neither lower productivity nor lower real GDP per person.E) B) and C)
F) A) and D)

Question 11

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

Accepted Answer

A)   increase U.S. GNP more than it increases U.S. GDP.
B)   increase U.S. GDP more than it increases U.S. GNP.
C)   have no affect on U.S. GNP, but will increase U.S. GDP.
D)   have no affect on U.S. GNP or GDP.E) A) and D)
F) C) and D)

Question 12

The long-run effects of an increase in the saving rate include

Accepted Answer

A)   a higher level of productivity.
B)   a higher growth rate of productivity.
C)   a higher growth rate of income.
D)   All of the above are correct.E) A) and C)
F) B) and D)

Question 13

Historically, the market prices of most natural resources adjusted for inflation)  have

Accepted Answer

A)   increased.
B)   remained stable.
C)   remained stable or decreased.
D)   decreased.E) C) and D)
F) None of the above

Question 14

The short-run effects of an increase in the saving rate include

Accepted Answer

A)   a higher level of productivity.
B)   a higher growth rate of productivity.
C)   a higher growth rate of income.
D)   All of the above are correct.E) None of the above
F) A) and B)

Question 15

In recent decades, economic growth has been much more rapid in South Korea than in the United States. What is the likely explanation for this fact?

Accepted Answer

The likely explanati...

Question 16

Which of the following statements about inputs is correct?

Accepted Answer

A)   A forest is an example of a natural resource; it is also an example of a renewable resource.
B)   There is no distinction between human capital and technological knowledge.
C)   Human capital is a non-produced factor of production.
D)   Physical capital is a non-produced factor of production.E) All of the above
F) A) and B)

Question 17

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) B) and D)

Question 18

Because of , an increase in the saving rate leads to higher growth of income and productivity only for a while.

Accepted Answer

The answer of Because of , an increase in the...

Question 19

As capital per worker rises, output per worker rises. However, this increase in output per worker is smaller at smaller levels of existing capital per worker.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following can be measured by the level of real GDP per person?

Accepted Answer

A)   productivity and the standard of living
B)   productivity but not the standard of living
C)   the standard of living but not productivity
D)   neither the standard of living nor productivityE) A) and B)
F) None of the above

Exam 7: Production and Growth

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

Correct AnswerverifiedShow Answer

In recent decades, economic growth has been much more rapid in South Korea than in the United States. What is the likely explanation for this fact?

Correct AnswerverifiedThe likely explanati...View AnswerShow Answer

If a country's saving rate declined, then other things the same, in the long run the country would have

Correct AnswerverifiedShow Answer

The catch-up effect refers to the idea that poor countries, despite their best efforts, are not likely ever to experience the economic growth rates of wealthier countries.

Correct AnswerverifiedShow Answer

Historically, the market prices of most natural resources adjusted for inflation) have

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Which of the following is an example of a renewable natural resource?

Correct AnswerverifiedShow Answer

Investment in

Correct AnswerverifiedShow Answer

Two countries with the same saving rates must have the same growth rate of real GDP per person.

Correct AnswerverifiedShow Answer

Which of the following can be measured by the level of real GDP per person?

Correct AnswerverifiedShow Answer

In 2011, Modern Electronics, Inc. produced 60,000 calculators, employing 80 workers, each of whom worked 8 hours per day. In 2012, the same firm produced 76,500 calculators, employing 85 workers, each of whom worked 10 hours per day. Productivity at Modern Electronics

Correct AnswerverifiedShow Answer

Which of the following statements is not correct?

Correct AnswerverifiedShow Answer

Which of the following pairs of countries experienced approximately the same rate of growth of real income per person over about the last 120 years?

Correct AnswerverifiedShow Answer

The short-run effects of an increase in the saving rate include

Correct AnswerverifiedShow Answer

The long-run effects of an increase in the saving rate include

Correct AnswerverifiedShow Answer

Human capital is the

Correct AnswerverifiedShow Answer

Which of the following statements about inputs is correct?

Correct AnswerverifiedShow Answer

As capital per worker rises, output per worker rises. However, this increase in output per worker is smaller at smaller levels of existing capital per worker.

Correct AnswerverifiedShow Answer

Which of the following is an example of human capital?

Correct AnswerverifiedShow Answer

Because of , an increase in the saving rate leads to higher growth of income and productivity only for a while.

Correct AnswerverifiedShow Answer

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