Question 1

Which of the following is correct?

Accepted Answer

A)   There is no debate about the effects of higher population growth on economic growth.
B)   Natural resources clearly place limits on growth; there is simply no way to reduce either the amount or type of natural resources needed to produce goods.
C)   How much an increase in capital increases a country's output is independent of that country's current level of capital.
D)   Economists argue that outward rather than inward policies are likely to promote economic growth.E) A) and D)
F) B) and D)

Question 2

Dilbert's Incorporated produced 5,000,000 units of accounting software in 2008.At the start of 2009 the pointy-haired boss reduced total annual hours of employment from 10,000 to 8,000 and production was 4,800,000.These numbers indicate that productivity

Accepted Answer

A)   fell by 4%.
B)   fell by 20%.
C)   rose by 12%.
D)   rose by 20%.E) All of the above
F) A) and B)

Question 3

Nathan owns a bakery that bakes only cakes.All of his bakers work 8 hours per day.In 2009,he employed 5 bakers who produced a total of 200 cakes each day.In 2010,he employed 6 bakers who produced a total of 249 cakes each day.The bakery's productivity

Accepted Answer

A)   decreased by 2.33%.
B)   increased by 2.33%.
C)   increased by 3.75%.
D)   increased by 24.50%.E) C) and D)
F) A) and B)

Question 4

How do outward-oriented policies affect a nation's productivity?

Accepted Answer

Most economists believe that poor nation...

Question 5

Over the past 100 years,U.S.real GDP per person has doubled about every 35 years.If it continues to double every 35 years,then in 100 years U.S.real GDP per person will be about

Accepted Answer

A)   4 times higher than it is now.
B)   8 times higher than it is now.
C)   12 times higher than it is now.
D)   16 times higher than it is now.E) A) and C)
F) B) and C)

Question 6

Workland has a population of 10,000,of whom 7,000 work 8 hours a day to produce a total of 224,000 final goods.Laborland has a population of 5,000,of whom 4,000 work 12 hours a day to produce a total of 120,000 final goods.

Accepted Answer

A)   Workland has higher productivity and higher real GDP per person than Laborland.
B)   Workland has higher productivity but lower real GDP per person than Laborland.
C)   Workland has lower productivity but higher real GDP per person than Laborland.
D)   Workland has lower productivity and lower real GDP per person than Laborland.E) A) and B)
F) All of the above

Question 7

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 8

If WarmWear,a U.S.manufacturer of winter clothing,opens a new factory in Austria,then

Accepted Answer

A)   Austrian GNP increases by more than Austrian GDP,because GDP includes income earned by foreigners working in Austria.
B)   Austrian GNP increases by more than Austrian GDP,because GDP excludes income earned by foreigners working in Austria.
C)   Austrian GNP increases by less than Austrian GDP,because GDP includes income earned by foreigners working in Austria.
D)   Austrian GNP increases by less than Austrian GDP,because GDP excludes income earned by foreigners working in Austria.E) B) and D)
F) A) and C)

Question 9

In 1870,the richest country in the world was

Accepted Answer

A)   the United States.
B)   Spain.
C)   the United Kingdom.
D)   Germany.E) A) and B)
F) A) and C)

Question 10

The behavior of market prices over time indicates that natural resources are

Accepted Answer

A)   a limit to economic growth.
B)   unrelated to economic growth.
C)   not a limit to economic growth.
D)   the major determinant of productivity.E) B) and C)
F) All of the above

Question 11

A country that made its courts less corrupt and its government more stable would likely see its standard of living rise.

Accepted Answer

A) True 
 B)False

Question 12

All else equal,if there are diminishing returns,then which of the following is true if a country increases its capital by one unit?

Accepted Answer

A)   Output will rise by more than it did when the previous unit was added.
B)   Output will rise but by less than it did when the previous unit was added.
C)   Output will fall by more than it did when the previous unit was added.
D)   Output will fall but by less then it did when the previous unit was added.E) All of the above
F) A) and D)

Question 13

In one day Madison Laundry washed 4,000 pounds of laundry with 5 workers who each worked 8 hours.What was its productivity?

Accepted Answer

A)   4000 pounds of laundry
B)   500 pounds of laundry per hour
C)   100 pounds of laundry per hour
D)   None of the above is correct.E) A) and B)
F) A) and C)

Question 14

Countries that grew the fastest over the last 100 or so years had growth rates of real income per person of about

Accepted Answer

A)   0.5 percent per year.
B)   1.5 percent per year.
C)   2.0 percent per year.
D)   2.5 percent per year.E) A) and B)
F) A) and C)

Question 15

When a country removes trade barriers and imports appliances and exports engineering services,

Accepted Answer

A)   its growth slows.
B)   its productivity decreases.
C)   it is essentially transforming engineering services into appliances.
D)   its economic well-being decreases while that of the country that sells appliances increases.E) B) and D)
F) A) and D)

Question 16

Suppose a country imposes new restrictions on how many hours people can work.If these restrictions reduce the total number of hours worked in the economy,but all other factors that determine output are held fixed,then

Accepted Answer

A)   productivity and output both rise.
B)   productivity rises and output falls.
C)   productivity falls and output rises.
D)   productivity and output fall.E) A) and B)
F) B) and C)

Question 17

Other things the same,which of the following would increase productivity?

Accepted Answer

A)   an increase in either human or physical capital
B)   an increase in human capital but not an increase in physical capital
C)   an increase in physical capital but not an increase in human capital
D)   neither an increase in human capital nor an increase in physical capitalE) All of the above
F) B) and D)

Question 18

Suppose a country increases trade restrictions.This country would be pursing an

Accepted Answer

A)   inward policy,which most economists believe has beneficial effects on the economy.
B)   inward policy,which most economists believe has adverse effects on the economy.
C)   outward policy,which most economists believe has beneficial effects on the economy.
D)   outward policy,which most economists believe has adverse effects on the economy.E) A) and B)
F) None of the above

Question 19

If the price of a good has risen over time,

Accepted Answer

A)   it must have become more scarce.
B)   it must have become less scarce.
C)   it has become more scarce only if the price adjusted for inflation has risen.
D)   it has become less scarce only if the price adjusted for inflation has risen.E) C) and D)
F) All of the above

Question 20

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 D)
F) None of the above

Exam 17: Production and Growth

Dilbert's Incorporated produced 5,000,000 units of accounting software in 2008.At the start of 2009 the pointy-haired boss reduced total annual hours of employment from 10,000 to 8,000 and production was 4,800,000.These numbers indicate that productivity

Correct AnswerverifiedShow Answer

Suppose a country increases trade restrictions.This country would be pursing an

Correct AnswerverifiedShow Answer

How do outward-oriented policies affect a nation's productivity?

Correct AnswerverifiedMost economists believe that poor nation...View AnswerShow Answer

If WarmWear,a U.S.manufacturer of winter clothing,opens a new factory in Austria,then

Correct AnswerverifiedShow Answer

Other things the same,which of the following would increase productivity?

Correct AnswerverifiedShow Answer

Over the past 100 years,U.S.real GDP per person has doubled about every 35 years.If it continues to double every 35 years,then in 100 years U.S.real GDP per person will be about

Correct AnswerverifiedShow Answer

Countries that grew the fastest over the last 100 or so years had growth rates of real income per person of about

Correct AnswerverifiedShow Answer

The behavior of market prices over time indicates that natural resources are

Correct AnswerverifiedShow Answer

Which of the following is correct?

Correct AnswerverifiedShow Answer

All else equal,if there are diminishing returns,then which of the following is true if a country increases its capital by one unit?

Correct AnswerverifiedShow Answer

In one day Madison Laundry washed 4,000 pounds of laundry with 5 workers who each worked 8 hours.What was its productivity?

Correct AnswerverifiedShow Answer

A country that made its courts less corrupt and its government more stable would likely see its standard of living rise.

Correct AnswerverifiedShow Answer

Workland has a population of 10,000,of whom 7,000 work 8 hours a day to produce a total of 224,000 final goods.Laborland has a population of 5,000,of whom 4,000 work 12 hours a day to produce a total of 120,000 final goods.

Correct AnswerverifiedShow Answer

In 1870,the richest country in the world was

Correct AnswerverifiedShow Answer

Human capital is the

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

Nathan owns a bakery that bakes only cakes.All of his bakers work 8 hours per day.In 2009,he employed 5 bakers who produced a total of 200 cakes each day.In 2010,he employed 6 bakers who produced a total of 249 cakes each day.The bakery's productivity

Correct AnswerverifiedShow Answer

When a country removes trade barriers and imports appliances and exports engineering services,

Correct AnswerverifiedShow Answer

Suppose a country imposes new restrictions on how many hours people can work.If these restrictions reduce the total number of hours worked in the economy,but all other factors that determine output are held fixed,then

Correct AnswerverifiedShow Answer

If the price of a good has risen over time,

Correct AnswerverifiedShow Answer

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Most economists believe that poor nation...
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