Economic Growth ALA

The opportunity cost of having more capital and being more productive in the future is:

reduced consumption today.

The U.S. poverty line for an individual in 2012 was:

slightly less than the world average income.

A(n) amount of capital stops a country from achieving its full potential.

small

Suppose that the growth rate of real GDP per capita is 12 percent per year. It will take years for real GDP per capita to double.

6

The rule of is a quick and easy way to estimate how long it will take for a number or amount to double in size given a constant rate of growth.

72

Suppose that in year 1, real GDP was $50 billion and in year 2, real GDP rose to $54 billion. The growth rate of real GDP was %. (Enter just the number; % sign has been provided for you.)

8

Using a production possibilities curve economic growth resulting from the use of previously idle resources is shown as:

A movement toward the curve.

The foundation of a science that would come to be known as economics began with: Multiple choice question.

Adam Smith's book An Inquiry into the Nature and Causes of the Wealth of Nations.

Growth was higher in the decade following NAFTA than in the decade preceding it. (True or False)

True

In Great Britain by 1750, whole sections of the English peasantry were enjoying levels of prosperity and wealth that had previously been reserved for elites such as kings and clergy. (True or False)

True

When it comes to growth rates, small changes can have big impacts and steady growth over time can change the world. (True or False)

True

While some countries have experienced improvements in standards of living, there are a few countries that are subject to absolute poverty. (True or False)

True

Knowing how (blank) an economy is growing can give us an idea of how big it will be in the future.

fast

Real GDP growing at 4 percent is considered to be a(n) growth rate for an industrialized country and suggests robust economic growth.

fast

In the 10 years after NAFTA's enactment, from 1994 to 2004 in the United States growth was (slower/faster) than in the decade preceding it.

faster

If idle resources are put to use and more output is produced, there is in the economy.

growth

The time it takes for something to double is approximately equal to 72 divided by the rate. (Remember enter only one word in the blank.)

growth

If a country with a fixed amount of capital and technology experiences population growth, we can expect real GDP to:

increase and real GDP per capita to decrease so that standards of living will fall.

China is allocating less of its output toward consumption and more toward:

the production of new capital

Starting in the late 1600s, as economies started to grow,: Multiple choice question.

the standards of living of the people within them grew also.

Scottish philosopher Adam Smith wrote his book An Inquiry into the Nature and Causes of the Wealth of Nations:

to try to explain the changes and improvements in people's lives by 1770.

Knowing how fast an economy is growing relative to population tells us:

whether standards of living are rising or falling on average.

There are (blank) returns to capital for an economy.

diminishing or decreasing

Given a constant rate of growth, the rule of 72 is a quick and easy way to estimate how long it will take for a number or amount to:

double in size.

Some economies started to grow faster than ever before starting in the:

early 1900s.

An increase in real GDP or real GDP per capita is called:

economic growth

The term "poor" is a(n) _____ term; we must define it in comparison with some benchmark.

relative

Starting in the late 1600s, certain economies started to grow faster than ever before and as they grew (blank) the of living of the people within them grew too. (Remember enter only one word in the blank.)

standard

Suppose that the growth rate of real GDP per capita is 6 percent per year. It will take years for real GDP per capita to double.

12

Suppose that in year 1, real GDP per capita was $28,000 billion and in year 2, real GDP per capita rose to $32,200 billion. The growth rate of real GDP per capita was %. (Enter just the number; % sign has been provided for you.)

15

Suppose that in year 1, real GDP per capita was $28,000 billion and in year 2, real GDP per capita rose to $32,200 billion. The growth rate of real GDP per capita was (Enter just the number; % sign has been provided for you.)

15

Suppose that in year 1, real GDP per capita was $30,000 billion and in year 2, real GDP per capita rose to $34,500 billion. The growth rate of real GDP per capita was %. (Enter just the number; % sign has been provided for you.)

15

Suppose that real GDP per capita equals $25,000 and that the growth rate of real GDP per capita is 4 percent per year. According to the rule of 72, it will take (blank) years for real GDP per capita to double to $50,000.

18

Suppose that in year 1, real GDP was $75 billion and in year 2, real GDP rose to $90 billion. The growth rate of real GDP was %. (Enter just the number; % sign has been provided for you.)

2

The changes and improvements in people's lives that began by 1770 are detailed in a book called An inquiry into the Nature and Causes of the Wealth of Nations by

Adam Smith

Since 1978, (blank) has been able to sustain average growth rates of roughly 9 percent. (Name the country.)

China

(blank) growth is calculated using real GDP or real GDP per capita.

Economic

By allocating time and resources to schooling instead of another activity, you will have (blank) more capital in the future, increasing your productivity.

Human

In 1994, Canada, Mexico and the United States entered into an agreement to reduce trade barriers. This agreement was the:

North American Free Trade Agreement.

Which of the following is not a way in which economic growth can occur?

Prices fall

Clarify the following formula: [(New Real GDP - Old Real GDP)/Old Real GDP] * 100%

This gives us the economic growth rate.

An example of a new technology that can increase productivity is:

a new and improved machine to pick coffee beans.

Historically, the average income in the United States is:

about 4 times greater than the world average.

Economic growth is defined as:

an increase in real GDP or real GDP per capita.

Using a production possibilities curve, economic growth resulting from additional resources is shown as: Multiple choice question.

an outward shift of the curve.

There are diminishing returns to (blank) for an economy.

capital, labor, or labour

An example of how existing resources can become more productive is: Multiple choice question.

coffee pickers who are younger and fitter.

Underutilized resources, such as unemployed workers or idle capital, will leave an economy its production possibilities frontier. (Use one word for the blank.)

inside

The error of the rule of 72 approximation increases with growth rates.

larger, higher, bigger, greater, increasing, increased, high, or faster

Real GDP per capita in China is:

lower than in the United States, but China's growth rate is making it possible for the Chinese to catch up to the United States.

The only source of sustainable economic growth is:

new technology

A graph that shows the possible combinations of two different goods or services that can be produced with fixed resources and technology is the:

production possibilities frontier.