Question 1

Suppose that an American company opens and operates a restaurant in Ireland. This is an example of

Accepted Answer

A)   foreign direct investment. American saving is used to finance Irish investment.
B)   foreign direct investment. American saving is used to finance American investment.
C)   foreign portfolio investment. American saving is used to finance Irish investment.
D)   foreign portfolio investment. American saving is used to finance American investment.E) B) and C)
F) A) and B)

Question 2

When a country eliminates tariffs and other trade restrictions, intending to promote economic growth, it is pursuing_______-oriented policies.

Accepted Answer

The answer of When a country eliminates tariffs and other...

Question 3

Thomas Malthus's predictions turned out to be wrong due to

Accepted Answer

A)   technological advances such as those during the Industrial Revolution.
B)   smaller populations now than in the time of Malthus.
C)   the effects of brain-drain.
D)   unlimited natural resources.E) None of the above
F) A) and D)

Question 4

After adjusting for inflation, over time the prices of most natural resources have been

Accepted Answer

A)   steady or falling, meaning that our ability to conserve them is growing more rapidly than their supplies are dwindling.
B)   steady or falling, meaning that their supplies are dwindling more rapidly than our ability to conserve them is growing.
C)   rising, meaning that our ability to conserve them is growing more rapidly than their supplies are dwindling.
D)   rising, meaning that their supplies are dwindling more rapidly than our ability to conserve them is growing.E) B) and C)
F) C) and D)

Question 5

List the four determinants of an economy's productivity.

Accepted Answer

The four determinants are phys...

Question 6

What is the distinction between foreign direct investment and foreign portfolio investment?

Accepted Answer

A capital investment that is owned and o...

Question 7

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 8

Other things the same, an increase in population growth

Accepted Answer

A)   increases capital per worker. Further, there is some evidence that a higher population growth rate may increase the pace of technological progress.
B)   increases capital per worker. However, there is some evidence that a higher population growth rate may decrease the pace of technological progress.
C)   decreases capital per worker. Further, there is some evidence that a higher population growth rate may decrease the pace of technological progress.
D)   decreases capital per worker. However, there is some evidence that a higher population growth rate may increase the pace of technological progress.E) A) and D)
F) C) and D)

Question 9

The president of Suldinia, a developing country, proposes that his country needs to help domestic firms by reducing trade restrictions.

Accepted Answer

A)   These are outward-oriented policies and most economists believe they would have beneficial effects on growth in Suldinia.
B)   These are outward-oriented policies and most economists believe they would have adverse effects on growth in Suldinia.
C)   These are inward-oriented policies and most economists believe they would have beneficial effects on growth in Suldinia.
D)   These are inward-oriented policies and most economists believe they would have adverse effects on growth in Suldinia.E) B) and C)
F) None of the above

Question 10

Figure 25-1 
-Refer to Figure 21-1. In what way is the figure relevant to the catch-up effect?

Accepted Answer

The catch-up effect is observed when a r...

Question 11

Which of the following is not correct?

Accepted Answer

A)   Across countries there are large differences in the average income per person. These differences are reflected in large differences in the quality of life.
B)   With a growth rate of about 2 percent per year, average income per person doubles about every 60 years.
C)   The ranking of countries by average income changes substantially over time.
D)   In some countries real income per person has changed very little over many years.E) All of the above
F) C) and D)

Question 12

What term do we use to refer to the understanding of the best ways to produce goods and services?

Accepted Answer

The term i...

Question 13

In 2010, the typical Bangladeshi had about

Accepted Answer

A)   less than half the real income of a typical American a century ago.
B)   about the same 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 B)
F) B) and C)

Question 14

If your firm's production function has constant returns to scale and you increase all your inputs by 60%, then your firm's output will

Accepted Answer

A)   not change.
B)   increase, but by less than 60%
C)   increase by 60%
D)   increase by more than 60%.E) A) and B)
F) A) and C)

Question 15

Which of the following is correct?

Accepted Answer

A)   If developing countries limit career and educational opportunities for women, birth rates are likely to be lower.
B)   Growth rates in developed and developing countries are nearly the same.
C)   Historically, in periods where the rate of population growth was high, so was the rate of growth in world real GDP per person.
D)   None of the above is correct.E) B) and D)
F) B) and C)

Question 16

If a country were to increase its saving rate, then in the long run it would also increase its

Accepted Answer

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

Question 17

Real GDP per person is $10,000 in Country A, $20,000 in Country B, and $30,000 in Country C. The saving rate increases by the same rate in all three countries. Other things equal, we would expect that

Accepted Answer

A)   all three countries will grow at the same rate.
B)   Country A will grow the fastest.
C)   Country B will grow the fastest.
D)   Country C will grow the fastest.E) A) and D)
F) All of the above

Question 18

In one day Alpha Cabinet Company made 40 cabinets with 320 hours of labor. What was Alpha Cabinet Company's productivity?

Accepted Answer

A)   1/8 cabinet per hour
B)   8 hours per cabinet
C)   40 cabinets
D)   None of the above is correct.E) C) and D)
F) B) and D)

Question 19

Waldo works eight hours and produces 7 units of goods per hour. Emerson works six hours and produces 10 units of goods per hour.

Accepted Answer

A)   Waldo's productivity and output are greater than Emerson's.
B)   Waldo's productivity is greater than Emerson's but his output is less.
C)   Emerson's productivity and output are greater than Waldo's.
D)   Emerson's productivity is greater than Waldo's but his output is less.E) B) and C)
F) A) and D)

Question 20

The United Kingdom is

Accepted Answer

A)   an advanced economy, and over the past century its rate of economic growth has been higher than that of the United States.
B)   an advanced economy, and over the past century its rate of economic growth has been lower than that of the United States.
C)   a middle-income country, and over the past century its rate of economic growth has been higher than that of the United States.
D)   a middle-income country, and over the past century its rate of economic growth has been lower than that of the United States.E) B) and C)
F) A) and D)

Exam 12: Production and Growth

List the four determinants of an economy's productivity.

Correct AnswerverifiedThe four determinants are phys...View AnswerShow Answer

Suppose that an American company opens and operates a restaurant in Ireland. This is an example of

Correct AnswerverifiedShow Answer

If your firm's production function has constant returns to scale and you increase all your inputs by 60%, then your firm's output will

Correct AnswerverifiedShow Answer

After adjusting for inflation, over time the prices of most natural resources have been

Correct AnswerverifiedShow Answer

What term do we use to refer to the understanding of the best ways to produce goods and services?

Correct AnswerverifiedThe term i...View AnswerShow Answer

Waldo works eight hours and produces 7 units of goods per hour. Emerson works six hours and produces 10 units of goods per hour.

Correct AnswerverifiedShow Answer

The United Kingdom is

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

What is the distinction between foreign direct investment and foreign portfolio investment?

Correct AnswerverifiedA capital investment that is owned and o...View AnswerShow Answer

In 2010, the typical Bangladeshi had about

Correct AnswerverifiedShow Answer

In one day Alpha Cabinet Company made 40 cabinets with 320 hours of labor. What was Alpha Cabinet Company's productivity?

Correct AnswerverifiedShow Answer

When a country eliminates tariffs and other trade restrictions, intending to promote economic growth, it is pursuing_______-oriented policies.

Correct AnswerverifiedShow Answer

Other things the same, an increase in population growth

Correct AnswerverifiedShow Answer

The president of Suldinia, a developing country, proposes that his country needs to help domestic firms by reducing trade restrictions.

Correct AnswerverifiedShow Answer

Real GDP per person is $10,000 in Country A, $20,000 in Country B, and $30,000 in Country C. The saving rate increases by the same rate in all three countries. Other things equal, we would expect that

Correct AnswerverifiedShow Answer

If a country were to increase its saving rate, then in the long run it would also increase its

Correct AnswerverifiedShow Answer

Which of the following is correct?

Correct AnswerverifiedShow Answer

Figure 25-1 -Refer to Figure 21-1. In what way is the figure relevant to the catch-up effect?

Correct AnswerverifiedThe catch-up effect is observed when a r...View AnswerShow Answer

Which of the following is not correct?

Correct AnswerverifiedShow Answer

Thomas Malthus's predictions turned out to be wrong due to

Correct AnswerverifiedShow Answer

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The four determinants are phys...
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The term i...
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The likely explanati...
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A capital investment that is owned and o...
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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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The catch-up effect is observed when a r...
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Correct Answer
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Correct Answer
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