Question 1

An increase in capital will increase real GDP per person

Accepted Answer

A)  more in a poor country than a rich country. The increase in real GDP per person will be larger if the addition to capital is from domestic rather than foreign investment.
B)  more in a poor country than a rich country. The increase in real GDP per person will be the same whether the addition to capital is from domestic or foreign investment.
C)  less in a poor country than a rich country. The increase in real GDP per person will be larger if the addition to capital is from domestic rather than foreign investment.
D)  less in a poor country than a rich country. The increase in real GDP per person will be the same whether the addition to capital is from domestic or foreign investment.E) None of the above
F) A) and B)

Question 2

The average income in a rich country

Accepted Answer

A)  is about 5 times that in a poor country. Further, people in rich countries have longer life expectancy.
B)  is about 5 times that in a poor country. However, people in rich countries have about the same life expectancy as those in poor countries.
C)  is more than ten times that in a poor country. Further, people in rich countries have longer life expectancy.
D)  is more than ten times that in poor country. However, people in rich countries have about the same life expectancy as those in poor countries.E) B) and D)
F) B) and C)

Question 3

An increase in the saving rate permanently increases the growth rate of real GDP per person.

Accepted Answer

A) True 
 B)False

Question 4

In a particular production process, if the quantities of all inputs used double, then the quantity of output doubles as well. This means that

Accepted Answer

A)  the production process cannot be enhanced by technological advances.
B)  no mathematical representation of the relevant production function can be formulated.
C)  the relevant production function has the limits-to-growth property.
D)  the relevant production function has the constant-returns-to-scale property.E) A) and B)
F) C) and D)

Question 5

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

Accepted Answer

A)  tin
B)  petroleum
C)  gold
D)  All of the above are correct.E) A) and D)
F) A) and C)

Question 6

According to studies using international data, an increase in the saving rate

Accepted Answer

A)  does not increase the growth rate of output.
B)  increases the growth rate of output for a few years.
C)  increases the growth rate of output for about a decade.
D)  increases the growth rate of output for several decades.E) A) and C)
F) None of the above

Question 7

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

Accepted Answer

A)  the knowledge possessed by scientists
B)  carpenters' labor services
C)  lumber
D)  All of the above are correct.E) None of the above
F) A) and C)

Question 8

In which of the following countries has economic growth been sufficiently strong in recent history to propel that country from being among the poorest in the world to being among the richest in the world?

Accepted Answer

A)  India
B)  Mexico
C)  Senegal
D)  SingaporeE) A) and D)
F) A) and C)

Question 9

Economists generally believe that policies such as reducing barriers to trade are likely to foster economic growth.

Accepted Answer

A) True 
 B)False

Question 10

If there are diminishing returns to capital, then

Accepted Answer

A)  capital produces fewer goods as it ages.
B)  old ideas are not as useful as new ones.
C)  increases in the capital stock eventually decrease output.
D)  increases in the capital stock increase output by ever smaller amounts.E) All of the above
F) A) and C)

Question 11

An organization that tries to encourage the flow of investment to poor countries is the

Accepted Answer

A)  World Bank.
B)  Organization of Less Developed Countries.
C)  Alliance of Developing Countries.
D)  International Development Alliance.E) None of the above
F) A) and D)

Question 12

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)  the demand for the resource has increased and the supply has decreased.
D)  the demand for the resource has decreased and the supply has increased.E) None of the above
F) A) and B)

Question 13

In addition to investment in physical and human capital, what other public policies might a country adopt to increase productivity?

Accepted Answer

In addition to investment in physical an...

Question 14

Other things the same, an economy's factors of production are likely to be used more effectively if there is an economywide respect for property rights.

Accepted Answer

A) True 
 B)False

Question 15

A forest is an example of a nonrenewable resource.

Accepted Answer

A) True 
 B)False

Question 16

International data on the history of real GDP growth rates shows that over the last 110 years or so, rich countries got richer and poor countries got poorer.

Accepted Answer

A) True 
 B)False

Question 17

The catch-up effect says that countries with low income can grow faster than countries with higher income. However, in statistical studies that include many diverse countries we do not observe the catch-up-effect unless we control for other variables that affect productivity. Considering the determinants of productivity, list and explain some things that would tend to prohibit or limit a poor country's ability to catch up with the rich ones.

Accepted Answer

The argument that poor countries will te...

Question 18

In 2008, the typical Bangladeshi had about

Accepted Answer

A)  1/5 the real income of a typical American a century ago.
B)  1/3 the real income of a typical American a century ago.
C)  2 times as much real income as that of a typical American a century ago.
D)  4 times as much real income as that of a typical American a century ago.E) A) and D)
F) C) and D)

Question 19

If per capita real income grows by 2 percent per year, then it will double in approximately 20 years.

Accepted Answer

A) True 
 B)False

Question 20

Popeye produces 20 cans of spinach in 8 hours. Wimpy produces 15 hamburgers in 10 hours. If each hamburger trades for 1.5 cans of spinach, then

Accepted Answer

A)  Popeye's production and productivity are greater than Wimpy's.
B)  Popeye's production is greater than Wimpy's, but his productivity is less.
C)  Wimpy's production and productivity are greater than Popeye's.
D)  Wimpy's production is greater than Popeye's, but his productivity is less.E) All of the above
F) A) and D)

Exam 12: Production and Growth

International data on the history of real GDP growth rates shows that over the last 110 years or so, rich countries got richer and poor countries got poorer.

Correct Answer
verified

According to studies using international data, an increase in the saving rate

Correct Answer
verified

An organization that tries to encourage the flow of investment to poor countries is the

Correct Answer
verified

In which of the following countries has economic growth been sufficiently strong in recent history to propel that country from being among the poorest in the world to being among the richest in the world?

Correct Answer
verified

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

Correct Answer
verified

In addition to investment in physical and human capital, what other public policies might a country adopt to increase productivity?

Correct Answer
verified
In addition to investment in physical an...
View Answer

Correct Answer
verified
The argument that poor countries will te...
View Answer

A forest is an example of a nonrenewable resource.

Correct Answer
verified

If there are diminishing returns to capital, then

Correct Answer
verified

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

Correct Answer
verified

An increase in capital will increase real GDP per person

Correct Answer
verified

In a particular production process, if the quantities of all inputs used double, then the quantity of output doubles as well. This means that

Correct Answer
verified

Economists generally believe that policies such as reducing barriers to trade are likely to foster economic growth.

Correct Answer
verified

Popeye produces 20 cans of spinach in 8 hours. Wimpy produces 15 hamburgers in 10 hours. If each hamburger trades for 1.5 cans of spinach, then

Correct Answer
verified

In 2008, the typical Bangladeshi had about

Correct Answer
verified

If per capita real income grows by 2 percent per year, then it will double in approximately 20 years.

Correct Answer
verified

An increase in the saving rate permanently increases the growth rate of real GDP per person.

Correct Answer
verified

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

Correct Answer
verified

Other things the same, an economy's factors of production are likely to be used more effectively if there is an economywide respect for property rights.

Correct Answer
verified

The average income in a rich country

Correct Answer
verified

Exam 12: Production and Growth

International data on the history of real GDP growth rates shows that over the last 110 years or so, rich countries got richer and poor countries got poorer.

Correct AnswerverifiedShow Answer

According to studies using international data, an increase in the saving rate

Correct AnswerverifiedShow Answer

An organization that tries to encourage the flow of investment to poor countries is the

Correct AnswerverifiedShow Answer

In which of the following countries has economic growth been sufficiently strong in recent history to propel that country from being among the poorest in the world to being among the richest in the world?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

In addition to investment in physical and human capital, what other public policies might a country adopt to increase productivity?

Correct AnswerverifiedIn addition to investment in physical an...View AnswerShow Answer

Correct AnswerverifiedThe argument that poor countries will te...View AnswerShow Answer

A forest is an example of a nonrenewable resource.

Correct AnswerverifiedShow Answer

If there are diminishing returns to capital, then

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

An increase in capital will increase real GDP per person

Correct AnswerverifiedShow Answer

In a particular production process, if the quantities of all inputs used double, then the quantity of output doubles as well. This means that

Correct AnswerverifiedShow Answer

Economists generally believe that policies such as reducing barriers to trade are likely to foster economic growth.

Correct AnswerverifiedShow Answer

Popeye produces 20 cans of spinach in 8 hours. Wimpy produces 15 hamburgers in 10 hours. If each hamburger trades for 1.5 cans of spinach, then

Correct AnswerverifiedShow Answer

In 2008, the typical Bangladeshi had about

Correct AnswerverifiedShow Answer

If per capita real income grows by 2 percent per year, then it will double in approximately 20 years.

Correct AnswerverifiedShow Answer

An increase in the saving rate permanently increases the growth rate of real GDP per person.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Other things the same, an economy's factors of production are likely to be used more effectively if there is an economywide respect for property rights.

Correct AnswerverifiedShow Answer

The average income in a rich country

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified
In addition to investment in physical an...
View Answer

Correct Answer
verified
The argument that poor countries will te...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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