Question 1

According to classical growth theory, when real GDP per person_______the population grows.

Accepted Answer

Classical growth theory suggests that when real GDP per person exceeds the subsistence real income, the population grows because higher income levels lead to better living conditions and higher birth rates.

Question 2

In the figure above, according to the classical model of economic growth, in the long run the real wage rate equals _{--------------------}and the quantity of labor is_{--------------------} billions of hours per year.

Accepted Answer

The answer of 
In the figure above, according to the...

Question 3

If real GDP is $1,200 billion, the population is 60 million, and aggregate hours are 80 billion, labor productivity is

Accepted Answer

The answer of If real GDP is $1,200 billion, the...

Question 4

If real GDP increases by 6 percent and at the same time the population increases by 2 percent, then real GDP per person grows by real GDP per person grows by

Accepted Answer

Real GDP per person is calculated by dividing real GDP by the population. If real GDP increases by 6% and the population increases by 2%, the growth rate of real GDP per person is approximately 6% - 2% = 4%.

Question 5

The classical growth theory asserts that

Accepted Answer

Classical growth theory, particularly associated with Thomas Malthus, suggests that population growth will outpace agricultural production, leading to a situation where people earn only a subsistence level of income due to limited resources.

Question 6

$\begin{array} { c c c } 
\hline \text { Year } & \begin{array} { c } 
\text { Real GDP } \
\text { (millions of 2005 dollars) }
\end{array} & \begin{array} { c } 
\text { Population } \
\text { (millions of people) }
\end{array} \
\hline \text { Year 1 } & 500 & 10 \
\text { Year 2 } & 550 & 11 \
\hline
\end{array}$
According to the data in the table above,

Accepted Answer

The answer of \(\begin{array} { c c c } 
\hline...

Question 7

If an economy's growth rate of real GDP is 3 percent per year and the growth rate of the population
Is 2.5 percent per year, the growth rate of real GDP per person is

Accepted Answer

The answer of If an economy's growth rate of real...

Question 8

The shape of the productivity curve reflects the

Accepted Answer

The law of diminishing marginal returns states that as more of a variable input is added to a fixed input, the marginal product of the variable input will eventually decrease. This is because the fixed input becomes increasingly scarce relative to the variable input, and so the variable input becomes less productive. The shape of the productivity curve reflects the law of diminishing marginal returns because as more labor is added to a fixed amount of capital, the marginal product of labor will eventually decrease.

Question 9

Which of the following lists gives factors that increase labor productivity?

Accepted Answer

Saving and investment in physical capital, expansion of human capital, and discovery of new technologies are key factors that enhance labor productivity by improving the efficiency and capability of the workforce.

Question 10

Last year, in a nation far to the South, real GDP was $90 million and 900,000 workers were employed. This year real GDP is $100 million, 950,000 workers are employed, and the number of hours each worker works per year did not change. Hence, labor productivity

Accepted Answer

Labor productivity is calculated as real GDP divided by the number of workers. Last year, it was $90 million / 900,000 workers = $100 per worker. This year, it is $100 million / 950,000 workers = approximately $105.26 per worker. Therefore, labor productivity has increased.

Question 11

Human capital is acquired

Accepted Answer

Human capital is acquired through a combination of schooling, job training, and experience, as these contribute to the skills and knowledge that enhance an individual's productivity.

Question 12

A key reason why some nations show little or no growth is

Accepted Answer

A lack of incentives can hinder economic growth as it may discourage investment, innovation, and productivity improvements necessary for development.

Question 13

Classical growth theory predicts that in the long run there will be

Accepted Answer

Classical growth theory suggests that any increase in population or resources will eventually be offset by diminishing returns, leading to zero economic growth in the long run.

Question 14

The law of diminishing marginal returns states that

Accepted Answer

The law of diminishing marginal returns states that as more of a variable input (like capital) is added to a fixed input (like labor), the additional output produced from each additional unit of the variable input eventually decreases.

Question 15

Workers in the United States are_{--------------------}productive than workers in China because _{--------------------}

Accepted Answer

Workers in the United States are more productive than workers in China because they have more capital per worker. Capital per worker is a measure of how much capital (machinery, equipment, buildings, etc.) each worker has to work with. The more capital per worker, the more productive the worker can be.

Question 16

A central theme of the new growth theory is that

Accepted Answer

The new growth theory emphasizes that knowledge and technology can lead to sustained economic growth without diminishing returns, as they are non-rival and can be used repeatedly without being depleted.

Question 17

In recent years, Taiwan has experienced increases in savings and investment. As a result of the higher investment and saving, we expect
i.increases in physical capital. 
ii)increases in the inflation rate.
 iii)advances in technology.

Accepted Answer

Increases in savings and investment typically lead to increases in physical capital as more resources are allocated to building and improving infrastructure and equipment. Additionally, higher investment can drive advances in technology as businesses invest in research and development. However, these factors do not necessarily lead to increases in the inflation rate.

Question 18

According to the new growth theory, which of the following promote economic growth?
i.discoveries that bring profit
ii.choices that expand human capital
iii.random events that create technology change

Accepted Answer

The new growth theory emphasizes the role of knowledge, innovation, and human capital in driving economic growth. Discoveries that bring profit and choices that expand human capital are aligned with this theory as they contribute to sustained economic development. Random events are not a systematic part of this theory.

Question 19

If the level of technology rises, GDP per hour of labor

Accepted Answer

An increase in the level of technology enhances productivity, leading to an increase in GDP per hour of labor for any given level of capital per hour of labor.

Question 20

Real GDP is $700 billion, average hours worked per week is 42 and aggregate hours 150 billion hours. What is the economy's labor productivity?

Accepted Answer

The answer of Real GDP is $700 billion, average hours...

Quiz 9: Economic Growth

According to classical growth theory, when real GDP per person_______the population grows.

In the figure above, according to the classical model of economic growth, in the long run the real wage rate equals _{--------------------}and the quantity of labor is_{--------------------} billions of hours per year.

If real GDP is $1,200 billion, the population is 60 million, and aggregate hours are 80 billion, labor productivity is

If real GDP increases by 6 percent and at the same time the population increases by 2 percent, then real GDP per person grows by real GDP per person grows by

The classical growth theory asserts that

If an economy's growth rate of real GDP is 3 percent per year and the growth rate of the population Is 2.5 percent per year, the growth rate of real GDP per person is

The shape of the productivity curve reflects the

Which of the following lists gives factors that increase labor productivity?

Last year, in a nation far to the South, real GDP was $90 million and 900,000 workers were employed. This year real GDP is $100 million, 950,000 workers are employed, and the number of hours each worker works per year did not change. Hence, labor productivity

Human capital is acquired

A key reason why some nations show little or no growth is

Classical growth theory predicts that in the long run there will be

The law of diminishing marginal returns states that

Workers in the United States are_{--------------------}productive than workers in China because _{--------------------}

A central theme of the new growth theory is that

In recent years, Taiwan has experienced increases in savings and investment. As a result of the higher investment and saving, we expect i.increases in physical capital. ii) increases in the inflation rate. iii) advances in technology.

According to the new growth theory, which of the following promote economic growth? i.discoveries that bring profit ii.choices that expand human capital iii.random events that create technology change

If the level of technology rises, GDP per hour of labor

Real GDP is $700 billion, average hours worked per week is 42 and aggregate hours 150 billion hours. What is the economy's labor productivity?

Quiz 9: Economic Growth

According to classical growth theory, when real GDP per person_______the population grows.

In the figure above, according to the classical model of economic growth, in the long run the real wage rate equals --------------------and the quantity of labor is-------------------- billions of hours per year.

If real GDP is $1,200 billion, the population is 60 million, and aggregate hours are 80 billion, labor productivity is

If real GDP increases by 6 percent and at the same time the population increases by 2 percent, then real GDP per person grows by real GDP per person grows by

The classical growth theory asserts that

If an economy's growth rate of real GDP is 3 percent per year and the growth rate of the population Is 2.5 percent per year, the growth rate of real GDP per person is

The shape of the productivity curve reflects the

Which of the following lists gives factors that increase labor productivity?

Last year, in a nation far to the South, real GDP was $90 million and 900,000 workers were employed. This year real GDP is $100 million, 950,000 workers are employed, and the number of hours each worker works per year did not change. Hence, labor productivity

Human capital is acquired

A key reason why some nations show little or no growth is

Classical growth theory predicts that in the long run there will be

The law of diminishing marginal returns states that

Workers in the United States are--------------------productive than workers in China because --------------------

A central theme of the new growth theory is that

In recent years, Taiwan has experienced increases in savings and investment. As a result of the higher investment and saving, we expect i.increases in physical capital. ii) increases in the inflation rate. iii) advances in technology.

According to the new growth theory, which of the following promote economic growth? i.discoveries that bring profit ii.choices that expand human capital iii.random events that create technology change

If the level of technology rises, GDP per hour of labor

Real GDP is $700 billion, average hours worked per week is 42 and aggregate hours 150 billion hours. What is the economy's labor productivity?

In the figure above, according to the classical model of economic growth, in the long run the real wage rate equals _{--------------------}and the quantity of labor is_{--------------------} billions of hours per year.

Workers in the United States are_{--------------------}productive than workers in China because _{--------------------}