CH 28 Practice Exam
If the growth trend of labor productivity is 3 percent per year, the number of years that it will take for the standard of living to double will be about
23 years.
If the annual growth in a nation's productivity is 2.8 percent rather than 1.5 percent, then the nation's standard of living will double in about
25 years instead of 47 years.
In the periods 1995-2007 and 2007-2019, U.S. real GDP grew at the average annual rates of about
3.2 percent and 1.7 percent, respectively.
In the periods 1953-1973 and 1973-1995, U.S. real GDP grew at the average annual rates of about
3.6 percent and 2.8 percent, respectively.
In 2020, what approximate percentage of adults in the United States were college graduates or higher?
38 percent
What percentage of the U.S. adult population has a college or postcollege education (as of 2020)?
38 percent
Increasing returns would be a situation where a firm increases its workforce and other inputs by
5 percent and its output increase by 8 percent.
Factors that contributed to the higher U.S. labor-productivity growth in 1995-2010 relative to the earlier period include the following, except
population growth.
One major economic benefit of global competition is
pressure to innovate.
"Show me a pastoral society with an untouched environment, an abundance of leisure, and non-secular values, and I will show you an underdeveloped, poverty-ridden country." This statement is most likely to be made by a(n)
proponent of economic growth.
A nation's infrastructure refers to
public capital goods such as highways and sanitation systems.
A major result of the rise in the rate of productivity growth in the United States is a(n)
rise in the growth of living standards.
The percentage of U.S. adults with a high school education has
risen from 44 percent in 1960 to 91 percent in 2020.
A piece of software that benefits many users at the same time would be an example of
simultaneous consumption.
Which of the following is the largest contributor to the growth of labor productivity in the United States?
technological advance
The factor accounting for the largest increase in the productivity of labor in the United States has been
technological advance.
The largest contributor to increases in the productivity of American labor is
technological advance.
Empirical studies suggest that
technological advances account for about 40 percent of U.S. productivity growth.
Economies of scale refers to
the fact that large producers may be able to use more efficient technologies than smaller producers.
All of the following are sources of increasing returns and economies of scale except
the multiplier effect.
(LAST WORD) Rising wages for women in the United States have increased
the percentage of married women in the workforce.
An antigrowth view would be that there may be a significant tradeoff between productivity and
the quality of life.
Human capital refers to
the skills and knowledge that enable a worker to be productive.
One concern regarding educational attainment in the United States is that
there are fewer college graduates in science and engineering.
The annual growth of U.S. labor productivity
was greater between 1995 and 2010 than between 1973 and 1995.
Compared with the period from 1973 to 1995, the annual rate of productivity growth from 1995 to 2010 was about
2 times faster.
Which of the following statements is correct?
Between 1953 and 2019, increases in labor productivity account for more of the growth in U.S. real GDP than do increases in the quantity of labor.
Which of the following arguments is not made by critics of growth policies?
Growth may have given us the good life, but we cannot better it anymore.
Which of the following explanations is consistent with the decline in productivity growth that followed the Great Recession?
High levels of debt incurred prior to the Great Recession have hindered firms' ability to make productivity-enhancing investments.
Which of the following trends have we not seen in the United States in the past six decades or so?
Rising birthrates kept the native-born population growing at a steady rate.
Which of the following statements is correct?
The amount of real capital used per worker has increased historically in the United States.
Other things equal, which of the following would increase labor productivity the most?
The increase in the stock of real capital exceeds the increase in inputs of labor.
Which of the following statements is true about productivity growth in the United States since the Great Recession?
The productivity growth rate slowed to 1.2 percent from 2010 to 2021.
Which of the following is not an argument made by proponents of economic growth?
There is a direct relationship between a growing real GDP and rising pollution.
The historical reallocation of labor from agriculture to manufacturing in the United States has
increased the average productivity of labor.
(LAST WORD) Rising real wages for women in the U.S. workforce since the 1960s have
increased the opportunity cost of staying at home.
Which of the following factors has been the dominant source of economic growth in the United States (except in 1973-1995)?
increases in labor productivity
Which of the following is the single most important source of U.S. economic growth?
increases in labor productivity
More than half the growth of real GDP in the United States is caused by
increases in the productivity of labor.
Network effects are
increases in the value of a product to each user, including existing users, as the total number of users rises.
Increasing returns in production imply the following, except
increasing labor-requirements per unit of output.
Technological advances that contribute to economic growth include the following, except
innovative digital gadgets for consumers.
The dramatic slowdown in productivity growth experienced after the Great Recession
is still debated among many economists as to whether it represents a permanent shift in the economy.
Other things equal, if a full-employment economy reallocated a substantial quantity of its resources to capital goods, we would expect
labor productivity to rise.
Growth is advantageous to a nation because it
lessens the burden of scarcity.
Sources of increasing returns that help raise productivity growth include the following, except
low unemployment.
The fundamental invention underpinning the 1995-2010 rise in the average rate of productivity growth is the
microchip.
Which of the following is a main source of increasing returns in recent years?
more learning by doing
In the U.S. economic-growth experience,
most capital is complementary to labor.
Increases in the value of a product to each user, including existing users, as the total number of users rises are called
network effects.
Increases in the value of the product to each user, including existing users, as the total number of users rises are called
network effects.
Proponents of economic growth say that pollution
occurs, not because of growth, but because common resources are treated as free goods.
Labor productivity in the United States in the periods 1973-1995 and 1995-2010 grew at average rates of
1.5 percent and 2.8 percent, respectively.
Globally, on average test scores of eighth-grade math and science students, the United States ranks (as of 2019)
12th and 11th, respectively.
If the secular trend of labor productivity rises from 2 percent per year to 4 percent, the number of years that it will take for the standard of living to double will decline by about
17.5 years.
Between 2019 and 2032, productivity growth is expected to account for about ________ percent of the growth of real GDP in the United States.
82
About what percentage of the growth in real output in the United States from 2007 to 2019 was due to increases in labor productivity?
82 percent
What percentage of the U.S. adult population has at least a high school education (as of 2020)?
91 percent
Which of the following is not an explanation put forward to explain the recent productivity slowdown?
A massive influx of immigrant labor has caused the labor force to expand much faster than real GDP.
Which of the following is a true statement?
Economists who support economic growth say that it is the most practical route to the higher standards of living that the vast majority of people desire.
Reasons for the rise in productivity growth between 1995 and 2010 include the following, except
a decline in population.
The period in the U.S. economy from 1995 and 2010 was characterized by
a higher trend rate of productivity growth.
(LAST WORD) The entry of women into the workforce since the 1960s resulted in
a shift outward in the production possibilities curve of the United States.
All of the following are economic implications of the 1995-2010 rise in the average rate of productivity growth except
an end to the business cycle.
Which of the following factors is projected to be the dominant source of economic growth in the United States from now until 2032?
an increase in labor productivity
(LAST WORD) Factors that have contributed to the increase in women's labor-force participation rate in the United States include the following, except
an increase in the number of children, requiring mothers to find work along with fathers.
Which of the following would not be expected to increase labor productivity?
an increase in the size of the labor force
A review of the trends in labor-productivity growth in the United States for the periods 1973-1995, 1995-2010, and 2010-2021 suggests which of the following patterns?
an initial modest growth averaging 1.5 percent per year in 1973-1995, followed by much higher growth in 1995-2010, then a collapse to very slow growth in 2010-2018
Critics of economic growth
argue that economic growth does not resolve socioeconomic problems such as an unequal distribution of income and wealth.
Many economists studying the productivity-growth patterns in the United States believe that in the period 1995-2010, the productivity of labor in the nation
benefited from a significant wave of technological advance, coupled with global competition.
The pattern of productivity growth in the United States in the period 2010-2021, when compared to previous periods, suggests that
businesses are slowing down in their implementation of new productive technologies.
Technological advance is tightly intertwined with
capital formation.
Labor productivity can only increase if
capital increases faster than labor.
Trends in educational attainment in the United States since 1960 indicate that the percentage of adults
completing college has been rising, and so has the percentage completing high school.
Measured productivity growth for the United States declined following the Great Recession. Which of the following explanations for that phenomenon suggests that measured productivity has failed to account for actual gains?
creation of new products that are essentially free to consumers
One major aspect of the sociocultural-political environment of the United States that has generally been conducive to economic growth is the
favorable attitude toward work and risk-taking.
What economic concept would be most closely associated with a situation where an aluminum plant expands its operations and uses extensive computerization in the production line to reduce per-unit costs of production?
economies of scale
Human capital refers to the
education, training, and skills of workers.
One of the main arguments against further growth for industrialized nations focuses on the problem of
environmental quality.
One of the basic economic defenses of economic growth rests on the conclusion that
growth makes the gap between unlimited wants and scarce resources less acute.
In the period following the Great Recession, the creation of new Internet apps has
had little measured effect on GDP or productivity but may create a lot of consumer satisfaction.
The movement of workers from lower productivity jobs to higher productivity jobs would be an example of a(n)
improved resource allocation.
The shift of labor out of agriculture and into industry in the United States has tended to
increase labor productivity.
(LAST WORD) Over the past several decades, the percentage of women in the paid U.S. workforce has
increased due to higher wages, expanded job accessibility, changing preferences and attitudes, and other factors.
(LAST WORD) From 1960 to today, women's labor-force participation rate in the United States
increased from about 40 percent to 60 percent.
Historically, the total amount of capital per worker in the United States has
increased significantly and made labor more productive.
