econ test #3 chapter 6 pt. II
An increase in a nation's population results in
a movement along the nation's production function
Saving and investment that increase a nation's capital lead to
an increase in labor productivity.
An increase in labor productivity shifts the labor ________ curve ________.
demand; rightward
The relationship between education and economic growth can best be summarized by saying that
education has benefits beyond those who receive the education, which encourages economic growth.
A worker's stock of knowledge is known as
human capital.
An increase in saving that leads to more capital accumulation ________ labor productivity.
increases
Labor productivity increases with
increases in capital
Technological change
increases potential GDP.
If the saving rate increases, a country's growth rate of real GDP per hour of labor ________ and capital per hour of labor ________
increases; increases
The demand for labor curve
is downward sloping because productivity of labor diminishes as more workers are employed
Which of the following is TRUE regarding the real wage rate? The real wage rate
measures the quantity of goods and services an hour's work can buy
The country of Kemper is on its aggregate production function at point W in the above figure. If the population increases with no change in capital or technology, the economy will
move to point such as X.
If the price level rises by 3 percent and workers' money wages increase by 3 percent, then the
quantity of labor demanded does not change because there is no change in the real wage rate
Human capital is the
skill and knowledge accumulated by humans
Most ________ is embodied in physical capital.
technological change
The Industrial Revolution in England in large was the result of
technological innovations encouraged by the patent system.
Classical growth theory proposes that real GDP growth is ________ and that real GDP per person will ________ the subsistence level.
temporary; temporarily be above
The notion that technological change is not random but instead is driven by the pursuit of profits is an essential element of
the new growth theory.
If the real wage rate is such that the quantity of labor supplied by workers is less than the quantity of labor demanded by firms
there is a shortage of labor
The tables above show the labor market and the production function schedule for the country of Pickett. Potential GDP is ________
$14 trillion
Labor productivity, real GDP per labor hour, increases if
All of the above answers are correct.
If this quote is TRUE, what would the neoclassical growth theory predict?
Economic growth stops because most technological advances have already been made
Which of the following statements regarding human capital is INCORRECT?
Education is the only vehicle for the creation of human capital because training simply reinforces what has already been learned
________ is the knowledge and skill that people have obtained from education and on-the-job training
Human capital
If the price level increases, but workers' money wage rates remain constant,which of the following is TRUE
I and II
Which of the following statements are TRUE regarding the demand for labor
I and II
Which of the following is associated with classical growth theory
III: Population explosions bring real GDP per person back to subsistence levels.
