Econ 220 (Chapter 27)

Which of the following are used by economist to define and measure economic growth?

1) An increase in real GDP occurring over some time period 2) An increase in real GDP per capita occurring over some time period

Examples of growth-promoting institutional structures...

1) Competitive market system 2) Free Trade 3) Efficient financial institutions 4) Patents and copyrights 5) Strong property rights

The determinants that directly affect economic growth can be grouped into which of the following categories?

1) Efficiency 2) Demand 3) Supply

Other than a higher standard of living and more innovations, what are true about the impacts of modern economic growth in industrialized nations?

1) Increased leisure time and arts 2) Increase in democracies 3) Elimination of archaic social norms

"Determinants" for economic growth

1) Increases in the supply of capital goods 2) Improvements in technology 3) increases in the quantity and quality of human resources 4) same but natural resources

Why is growth important to an economic goal?

1) It increases standards of living 2) It increases a society's ability to resolve socioeconomic problems 3) It increases real wages and incomes

Leader Countries

Countries that develop and use the most advanced technologies.

Reductions in per-unit production costs that result from increases in output levels lead to _______ of _______.

Economies, Scale

(True or False) Countries that experienced economic growth earlier than other countries have lower average incomes today.

False

Efficiency factor is when an economy efficiency as well as _______ to reach its full production.

Full employment

Which of the following helps explain why the growth rate in the United States has been positive during the 1900s.

Increase in labor productivity

Which of the following helps explain why the growth rate in the united states has been positive during the 1900s.

Increase in labor productivity

Generally, technological advance is generated by the discovery of new _______ which allows _______ to be combined in improved ways that increase output.

Knowledge, Resources

Labor Productivity

Real output per hour of work.

Why do economists pay so much attention to small changes in the rate of economic growth?

These changes have large effects on the volume of output.

Economists define and measure economic growth as...

an increase in real GDP per capita over some period of time.

Modern economic growth has significantly increased the standard of living as well as _______, social, and political arrangements.

cultural

The purchase of the economy's expanding goods and services by households, businesses, and the government is known as the _______ factor.

demand

The four supply factors that constitute changes in physical and technical agents of production...

enable an economy to expand its potential GDP.

Strong property rights, _______ trade, patents and _______ market systems are all growth-promoting institutional structures.

free, competitive

Efficiency factor is when an economy must achieve economic efficiency as well as _______ to reach its full production potiential.

full employment

An economy that is experiencing economic ________ is better able to meet people's wants and resolve socioeconomic problems.

growth

Those countries which experienced modern economic growth earlier than other countries now have significantly...

higher standard of living.

Output per hour of work is the definition of...

labor productivity

The two main supply-side elements that contribute to changes in real GDP are increases in hours worked and increases in...

labor productivity.

The demand factor involves households, businesses, and government purchasing the economy's expanding output of goods and services so that there will be...

no unplanned increase in inventories and resources will remain fully employed.

Economists pay attention to small changes in economic growth because small changes in economic growth can make a big difference in the living _______ of a country.

standards

The six "determinants" of economic growth are grouped into three categories: one demand factor, four _______ factors, and efficiency factor.

supply

The supply factors that are part of the "determinants" of economic growth include increasing the quality and quantity of natural resources, increasing the stock of capital and improvements in...

technology

The efficiency factor involves both productive and allocative efficiency, which means in order to reach its full production potential an economy must...

use its resources in the least costly way to produce the specific mix of goods that maximizes people's well-being.