Chapter 12 - Production & Growth

The population growth rate tends to be higher in developed countries than in developing countries. A. True B. False

B. False

A country with a relatively low level of real GDP per person is considering adopting two policies to promote economic growth. The first is to decrease barriers to trade. The second is to restrict foreign portfolio investment. Which of these policies do most economists say promote growth? A. Both the first and the second B. The first but not the second C. The second but not the first D. Neither the first nor the second

B. The first but not the second

In 2014 income per person in the United States was about 10 times that in India. A. True B. False

A. True

The Social Security tax is a tax on A. capital. B. labor. C. land. D. savings.

B. labor.

Which of the following countries has had the greatest growth rate of real GDP per person within the last 10 years? A. Germany B. Bangladesh C. Argentina D. India

A. Germany

Which of the following statements is correct? A. Human capital per worker is a determinant of productivity. B. A nation cannot be highly productive in producing goods and services without abundant quantities of natural resources. C. Human capital and technological knowledge are the same thing. D. All technological knowledge is proprietary.

A. Human capital per worker is a determinant of productivity.

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

A. True

A country's standard of living depends on its ability to produce goods and services. A. True B. False

A. True

If a rich country reduced subsidies to domestic producers of goods that poor countries have a comparative advantage producing, the standard of living in these poor countries would likely rise. A. True B. False

A. True

Increases in both human capital per worker and physical capital per worker increase productivity. A. True B. False

A. True

Other things the same, an economy's factors of production are likely to be used more effectively if there is an economywide respect for property rights. A. True B. False

A. True

Other things the same, another unit of capital will increase output by more in a poor country than in a rich country. A. True B. False

A. True

Over the period 1870-2014, the United States experienced an average annual growth rate of real GDP per person of about 1.8 percent per year. A. True B. False

A. True

Industrial machinery is an example of A. a factor of production that in the past was an output from the production process. B. technological knowledge. C. a production function. D. an item which always has the property called constant returns to scale.

A. a factor of production that in the past was an output from the production process.

Japan is A. an advanced economy, and over the past century its rate of economic growth has been higher than that of the United States. B. an advanced economy, and over the past century its rate of economic growth has been lower than that of the United States. C. a middle-income country, and over the past century its rate of economic growth has been higher than that of the United States. D. a middle-income country, and over the past century its rate of economic growth has been lower than that of the United States.

A. an advanced economy, and over the past century its rate of economic growth has been higher than that of the United States.

Educational attainment tends to be A. low in countries with high population growth. B. low in countries with low population growth. C. high in countries with high population growth. D. unrelated to population growth.

A. low in countries with high population growth.

In order to promote growth in living standards, policymakers must A. protect property rights and maintain political stability. B. minimize accumulation of factors of production. C. rise taxes to increase government revenue. D. promote bureaucracy.

A. protect property rights and maintain political stability.

The rate of real economic growth is A. underestimated using measures of income growth. B. overestimated using measures of income growth. C. underestimated using measures of technological growth. D. overestimated using measures of technological growth.

A. underestimated using measures of income growth.

If a tax shifts the demand curve upward, A. we cannot infer anything because the shift described is not consistent with a tax. B. we can infer that the tax was levied on buyers of the good. C. we can infer that the tax was levied on both buyers and sellers of the good. D. we can infer that the tax was levied on sellers of the good.

A. we cannot infer anything because the shift described is not consistent with a tax.

Although growth rates across countries vary some, rankings of countries by income remain pretty much the same over time. A. True B. False

B. False

If it could increase its growth rates slightly, a country with low income would catch up with rich countries in about ten years. A. True B. False

B. False

The catch-up effect refers to the idea that poor countries, despite their best efforts, are not likely ever to experience the economic growth rates of wealthier countries. A. True B. False

B. False

Which of the following can be measured by the level of real GDP per person? A. Productivity and the standard of living B. Productivity but not the standard of living C. The standard of living but not productivity D. Neither the standard of living nor productivity

C. The standard of living but not productivity

A policy that increases saving will A. worsen economic growth, but improve health outcomes. B. worsen economic growth and health outcomes. C. improve economic growth but worsen health outcomes. D. improve economic growth and health outcomes.

D. improve economic growth and health outcomes.

Productivity is the amount of goods and services A. an economy produces. It is not linked to a nation's economic policies. B. an economy produces. It is linked to a nation's economic policies. C. produced for each hour of a worker's time. It is not linked to a nation's economic policies. D. produced for each hour of a worker's time. It is linked to a nation's economic policies.

D. produced for each hour of a worker's time. It is linked to a nation's economic policies.