Macro Econ

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Suppose output per worker in a country has grown at the same rate as technology over for many years. This​ country's growth would be described​ as:

"balanced" growth.

In the absence of technological​ progress, we know that the level of output per worker in the steady state​ will:

. remain constant.

(list above) Refer to the information above. Which of the following represents the level of investment needed to maintain a constant capital stock​ (K) in this​ economy?

.10K.

(list above) Refer to the information above. Which of the following represents the level of investment needed to maintain constant capital per effective worker​ (K/NA) in this​ economy?

.15K.

(list above) Refer to the information above. Which of the following represents the amount of investment per effective worker needed to maintain a constant level of capital per effective worker​ (K/NA)?

.16(K/NA)

(list above) Refer to the information above. Given this​ information, the steady-state rate of growth of​ Y/NA is:

0

Assume that an economy experiences both positive population growth and technological progress. Once the economy has achieved balanced​ growth, we know that growth rate of​ K/NA is:

0

The Social Security system in the United States was introduced in which​ year?

1935

When was the last year that GDP per capita in North Korea was approximately equal to GDP per capita in South​ Korea?

1970.

(list above) Refer to the information above. Given this​ information, the steady state rate of growth of output per worker​ is:

3%

Use the information provided below to answer the following questions. δ​= .11 gA​ = .03 gN​ = .02 Refer to the information above. Given this​ information, we know that effective labor​ (NA) grows at which​ rate?

5%

(list above) Refer to the information above. Which of the following represents the steady−state growth rate of output in this​ economy?

5%.

The amount of education in a country affects output per worker​ __________.

A and B are both correct.

Which of the following examples best describes ways to increase human capital​ directly? ​(Check all that apply.​)

A university professer decides to attend a conference on best teaching practices Sam decides to put off working and attends a 4-year university

Why is the amount of​ R&D spending important for​ growth?

All of the above.

Consider an economic model with three types of​ firms, wherein each firm type follows a different strategy towards research. Type X firms undertake basic​ research, type Y firms undertake applied​ research, and type Z firms imitate research. Any type X firm can sell its research to a type Y​ firm, whereas type Z firms can only imitate the research done by type Y firms. In this economic​ model, if the governing agency decides to implement laws promoting perfect competition market​ scenarios, which of the following implications materialize for firms in each of the​ categories?

Appropriability of research would go down​ permanently, fertility of research would improve only in the short run and diffusion of new technology would eventually go down.

Education increases human capital and thus output. Give a possible reason why the government should subsidize education.

Because​ education, at least higher​ levels, incurs an opportunity cost of lost​ wages, people may not be willing to invest in additional amounts of human capital.

Where does technological progress come from for the economic leaders of the​ world?

By generating new ideas through research and development.

Developing countries A and B have many​ similarities, such as a high level of​ corruption, export-oriented economic​ activities, high savings​ rates, and frequent outbreaks of violence and political instability. To boost the growth of their​ economies, both of the countries decided to introduce a series structural changes. Country A decided to transform into a free market economy under the belief that the markets will decide the most beneficial outcomes. The role of Country​ A's government was restricted to maintenance of basic law and order in the society and defense​ forces, leaving the corporate sector to​ self-regulate itself​ (a laissez-faire​ economy). Country B went for slow privatization with a large amount of government intervention in the economy.​ Simultaneously, Country​ B's government built a strong set of property rights. If the two countries started from the same point under the technology​ frontier,__________ will have lower technological progress and​ growth, due to_________

Country A lack of protection against monopolies

Developing countries do not generally create new ideas through research and development. Which of the following is not a source of technological progress for developing​ countries?

Discovering new sources of natural resources can lead to progress in developing countries.

In order to write the production function in the form​ below, according to the​ textbook, what two key assumptions must we​ make?

Employment is constant and there is no technological progress in the economy.

A higher investment rate can sustain higher growth of output forever.

False

A higher saving rate implies a higher level of capital per effective worker in the steady state and thus a higher rate of growth of output per effective worker.

False

Capital accumulation does not affect the level of output in the long​ run, only technological progress does.

False

Education increases human capital and thus output. It follows that governments should subsidize education.

False

Evidence suggests that happiness in rich countries increases with output per person

False

In steady​ state, output per effective worker grows at the rate of population growth.

False

In virtually all the countries of the​ world, output per person is converging to the level of output per person in the United States.

False

Technology has not played an important part in Chinese economic growth.

False

The fact that one cannot patent a theorem implies that private firms will not engage in basic research.

False

The price of food is higher in poor countries than it is in rich countries.

False

A firm in Country​ A, launched a new product P which became a success in national as well as international markets. Following the success of​ P, many firms in Country B started producing and marketing product P in bulk. Country B firms have noticed lower​ productivity, as compared to the Country A​ firm, and huge inventory stocks. Within a​ year, Country C firms introduced an​ improved, cheaper and more​ efficient, version of product P. This improved product became a success in domestic and international markets. Which of the following statements is​ true?

Firms in Country A and B both incur​ losses, but the losses incurred by Country B firms are greater due to poor managerial practices of these firms.

Which of the following is not a reason developing countries may choose to have poor patent​ protection?

Firms in developing countries are more willing to engage in research and development with poor patent protection.

The government of a centrally planned economy wants to boost the rates of technological​ progress, investments, and output growth in the economy. Which of the following strategies will be most effective for the​ country?

Following a policy of slow paced privatization of state enterprises and developing a good set of property rights.

Which of the following is not a true​ statement?

In a competitive​ market, If firms have made large profits from new​ products, they tend to have fewer incentives to create new discoveries.

Suppose that an international treaty ensuring that each​ country's patents are legally protected all over the world is signed. How does this affect the appropriability and fertility of​ research, R&D spending in the long​ run, and output in the long​ run?

It will raise the appropriability for​ firms, increase​ R&D spending, and raise growth for developed economies.

In the production function Y​ = f(K,​ NA), for a given state of​ technology, constant returns to scale implies that output​ (Y) will increase by​ 7% when

K and N increase by​ 7%.

Which of the following is not a necessity for this country to attain a rapid output growth​ rate?

Make large investments in​ R&D so that the country will sustain a rapid growth rate over a long period of time.

For about​ 1,000 years after the fall of the Roman​ Empire, there was essentially no growth in output per person in Europe—any increase in output led to a proportional increase in population. This type of phenomenon is referred to as the

Malthusian trap.

Which of the following is NOT constant when balanced growth is​ obtained?

NA

Is the United States likely to fall into a Malthusian trap the same way that England did during the 18th​ century?

No, the U.S economy is more diversified and can internalize technological advances better than England could.

Assume that an economy experiences both positive population growth and technological progress. Once the economy has achieved balanced​ growth, we know​ that:

S/NA = (δ​+ gA + gN​) K/NA

Assume there is a permanent reduction in the rate of technological progress. What is the likely impact on the growth rate and the level of output per worker in the short run and in the long​ run?

The growth rate of output per worker falls in the short run. In the long​ run, the growth rate approaches a new steady state with a permanently lower growth rate. Output per worker continues to rise over​ time, just at a slower rate.

The governments of Countries​ A, B, and C enter into an agreement for the implementation of strong patent laws in all three of the countries. Which of the following statements depict the result of this agreement in the short​ run?

The output and the rate of technological progress will fall for firms in Country​ B, they will rise for firms in Country​ A, and will be indeterminate for firms in Country C.

Assume there is a permanent reduction in the saving rate. What is the likely impact on the growth rate and the level of output per worker in the short run and in the long​ run?

There is no effect on the​ steady-state growth rate of output per worker. The growth rate of output per worker falls in the short​ run, but in the long run it approaches its original​ steady-state rate.

Even if the potential returns from​ R&D spending are identical to the potential returns from investing in a new​ machine, R&D spending is much riskier for firms than investing in new machines.

True

For about​ 1,000 years after the fall of the Roman​ Empire, there was essentially no growth in output per person in Europe because any increase in output led to a proportional increase in population.

True

If capital never​ depreciated, growth could go on forever.

True

If the rate of technological progress​ increases, the investment rate​ (the ratio of investment to​ output) must increase to keep capital per effective worker constant.

True

Writing the production function in terms of capital and effective labor implies that as the level of technology increases by​ 10%, the number of workers required to achieve the same level of output decreases by​ 10%.

True

n steady​ state, output per worker grows at the rate of technological progress.

True

Because eventually we will know​ everything, growth will have to come to an end.

Uncertain

Given the production function​ above, an increase in human capital per worker will lead to​

a higher​ steady-state level of output per worker.

Based on recent​ research, which of the following is the most likely cause of the reduction in the rate of technological​ progress?

a reduction in the fertility of research

Which of the following can help explain the technology gap that exists between some​ countries?

all of the above

Which of the following is hypothesized to explain the reduction in the rate of technological​ progress?

all of the above

Which of the following represents a dimension of technological​ progress?

all of the above

Even if the potential returns from​ R&D spending are identical to the potential returns from investing in a new​ machine, R&D spending is much riskier for firms than investing in new machines because​ __________.

all of the above.

Low tax rates and good public infrastructure would be expected to raise output per worker because​ __________.

all of the above.

Which of the following best describes a situation where research is considered​ appropriable?

all of the above.

Which of the following will cause an increase in the steady−state growth rate of​ capital?

an increase in the population growth rate.

Which of the following will cause an increase in output per effective​ worker?

an increase in the saving rate.

How do each of the following policy proposals affect the appropriability and fertility of​ research, R&D spending in the long​ run, and output in the long​ run? Suppose that tax credits are given for each dollar of​ R&D spending. This proposal would lead to​ __________ in​ R&D spending. There would be​ __________ in the rates of technological progress and​ __________ in output growth.

an​ increase; an​ increase; an increase

Suppose there is a decrease in funding of​ government-sponsored conferences between universities and corporations. This proposal would lead to​ __________ in the fertility of applied research and to a​ __________ in growth.

a​ decrease; a decrease

If all of the type X firms started undertaking research which was not substitutable by research of other firms in the same category and simultaneously extremely strong patent laws were​ implemented, the fertility of research in the economy would ________

decrease

This is because the ease of undertaking research would_________ for type Y firms.

decrease

Writing the production function in terms of capital and effective labor implies that as the level of technology increases by​ 10%, the number of workers required to achieve the same level of output​ __________.

decreases by​ 10%.

The method of constructing a measure of technological progress relies on which of the following​ assumptions?

each factor of production is paid its marginal product

Which of the following is not a reason for firms to engage in basic​ research:

firms cannot patent a theorem.

Assume that an economy experiences both positive population growth and technological progress. Once the economy has achieved balanced​ growth, we know that the output per worker ratio​ (K/N) is:

growing at a rate of gA

Assume that an economy experiences both positive population growth and technological progress. Once the economy has achieved balanced​ growth, we know that output​ (Y) is:

growing at a rate of gA + gN

Assume that an economy experiences both positive population growth and technological progress. Once the economy has achieved balanced​ growth, we know that the capital stock​ is:

growing at a rate of gA + gN

Assume that an economy experiences both positive population growth and technological progress. Once the economy has achieved balanced​ growth, we know that the capital per effective worker ratio​ (K/NA) is:

growing at a rate of δ + gA + gN

Assume that an economy experiences both positive population growth and technological progress. Once the economy has achieved balanced​ growth, we know that the output per effective worker ratio​ (Y/NA) is:

growing at a rate of 0

Assume that an economy experiences both positive population growth and technological progress. Once the economy has achieved balanced​ growth, we know that the capital per worker ratio​ (K/N) is:

growing at the same rate as​ Y/N

Which of the following best characterizes the economic growth for OECD countries since the mid−​1970s

growth has slowed down.

In the OECD​ countries, there is a negative relationship between output per capita in 1950 and

growth since 1950.

A higher rate of female participation in the labor market​ (but constant​ population). This would​ ________ the level of output per​ worker, leading to a​ ________ level of output per person.

have no effect​ on; higher

Convergence of output per capita across countries has come​ from:

higher technological progress from the countries that started behind

Which of the following represents the fertility of​ research?

how​ R&D spending translates into new ideas

The amount of protection of property rights in a country affects output per worker by​ _________.

impacting the amount of productivity because strong property rights encourage more​ R&D.

Between 1950 and​ 1973, France,​ Germany, and Japan all experienced growth rates that were at least two percentage points higher than those in the United States. Yet the most important technological advances of that period were made in the United States. This can best be explained because the other countries​

imported the technology advancements from the United States

Research by Richard Layard indicates that an increase in a​ country's level of output per capita​ will

increase happiness in that country if output per capita is relatively low

In the absence of technological​ progress, we know with certainty that an increase in the saving rate will cause which of the​ following?

increase steady state consumption only if the increase in saving is less than the increase in depreciation.

Discuss how the level of output per person in the long run would likely be affected by each of the following​ changes: The right to exclude saving from income when paying income taxes. This would​ ________ the saving​ rate, leading to​ ________ output per worker and output per person in the long run

increase; higher

Which of the following represents the change in the capital​ stock?

investment minus depreciation

When the economy is in the steady​ state, we know with certainty​ that:

investment per worker is equal to depreciation per worker

If the rate of technological progress​ increases, in order to keep capital per effective worker​ constant, the​ __________.

investment rate must increase.

Patent protection is important in affecting technological progress because it makes research and development

more appropriable

Assume that an economy experiences both positive population growth and technological progress. A reduction in the saving rate will​ cause

none of the above

Assume that an economy experiences both positive population growth and technological progress. In this​ economy, which of the following is constant when balanced growth is​ achieved?

none of the above

Suppose the stock of capital increases by​ 2% and employment increases by​ 2%. Given this​ information, we know​ that:

none of the above

Suppose there is a reduction in the saving rate. This decrease in the saving rate will cause a reduction in which of the following once the economy reaches its new steady state​ equilibrium?

none of the above

Suppose two countries are identical in every way with the following exception. Economy A has a higher saving rate than economy B. Given this​ information, we know with certainty​ that:

none of the above

Which of the following will cause an increase in the steady−state growth rate of output per​ worker?

none of the above

As an economy adjusts to an increase in the saving​ rate, we would expect output per​ worker:

none of the above.

For this question assume that technological progress does not occur. The rate of saving in Canada has generally been greater than the saving rate in the U.S. Given this​ information, we know that in the long​ run:

none of the above.

Our model of long−run economic growth suggests that

none of the above.

Suppose there is an increase in the saving rate. This increase in the saving rate will cause an increase in which of the following once the economy reaches its new steady state​ equilibrium?

none of the above.

Which of the following will cause a reduction in the steady−state growth rate of output per​ worker?

none of the above.

A​ country's openness to trade can affect output per worker through​ __________ because it can impact the diffusion of technology.

productivity

Suppose individuals wish to obtain the most accurate comparison of living standards between the Canada and Saudi Arabia. To do​ so, one would convert Saudi Arabian output into dollars using

purchasing power parity methods

Low population growth would be expected to​ __________.

raise output per​ worker, because it will raise all of the levels of inputs and productivity per worker.

Suppose there is an elimination of patents on new pharmaceutical​ drugs, so the drugs can be copied and sold at a low cost as soon as they become available. This proposal would​ __________ the appropriability of drug research. There would be​ __________ in the development of new​ drugs, __________ in the rate of technological​ progress, and​ __________ in the growth rate.

reduce; a​ reduction; a​ reduction; a reduction

Which of the following best describes a situation where research is considered relatively​ fertile?

research that translates into many new products.

Suppose the following situation exists for an​ economy: K​t+1​/N > Kt​/N. Given this​ information, we know​ that:

saving per worker is greater than depreciation per worker in period t

Economic growth theory shows that the two main factors for an economy to grow are

technological advancement and capital accumulation.

Which of the following must occur to sustain economic growth in the long​ run?

technological progress.

Suppose there are two countries that are identical with the following exception. The saving rate in country A is greater than the saving rate in country B. Given this​ information, we know that in the long​ run:

the capital−labor ratio​ (K/N) will be greater in A than in B

Which of the following represents the appropriability of​ research?

the extent to which firms benefit from the results of their own​ R&D spending

Which of the following is always true after an economy reaches a balanced growth​ equilibrium?

the growth rate of capital is equal to the growth rate of the effective work force.

The aggregate production function shows the relationship between output and​

the inputs in production.

​"Convergence" has been occurring among the OECD countries because

the poorer countries have had higher growth rates than the richer ones.

the protection given to new products by the law

the protection given to new products by the law

A higher saving rate implies a higher level of capital per effective worker in the steady state and​ _________.

the rate of growth of output per effective worker remains unchanged.

Between 1950 and​ 2017, standards of living in the OECD countries

were converging

Economists do not only look at current growth​ trends, they also look at past growth patterns and what may have caused them. For​ example, growth rates from the end of the Roman Empire until 1500_________​, while the growth rates from 1500 to 1700 were ________

were flat with no growth small but positive

In steady​ state, the rate of population growth​ __________.

will have no effect on output per worker.

(list above) Refer to the information above. Which of the following represents the steady−state growth rate of output per worker in this​ economy?

​3%.

(list above) Refer to the information above. Given this​ information, the steady state rate of growth of output​ is:

​5%

Use the following information to answer the questions​ below: ​ (1) the rate of depreciation is​ 10% per​ year, ​ (2) the population growth rate is​ 2% per​ year, and ​ (3) the growth rate of technology is​ 3% per year. Refer to the information above. Which of the following equals the annual growth rate of​ "effective labor" in the steady state in this​ economy?

​5%.

Assume that an economy experiences both positive population growth and technological progress. In this​ economy, which of the following is constant when balanced growth is​ achieved?

​Y/NA

As countries become richer in output per​ person, people are able to spend​ __________ resources on food​ consumption, so the real cost of food​ __________.

​less; decreases

The geographic location of a country affects output per worker through​ __________.

​productivity, because the climate of a country may make it easier or more difficult to produce goods and services.

When switching from the​ "current exchange​ rate" method to the​ "purchasing power​ parity" method,​ India's standard of living in dollars

​rises, but still remains far below that of the U.S.

Suppose there is an increase in the saving rate. This increase in the saving rate must cause an increase in consumption per capita in the long run​ when:

capital per worker approaches the golden−rule level of capital per worker.

Evidence suggests that richer countries tend to have higher levels of happiness compared to poorer countries. When rich people are compared to richer​ people, the level of happiness__________.

does not significantly differ.

Which of the following will cause a reduction in output per worker in the long run​ run?

an increase in the number of workers.

Which of the following statements is always​ true?

any change in the capital stock is equal to investment minus depreciation.

Research by Richard Layard indicates that​ happiness:

appears to depend on​ people's relative incomes

The countries with the lowest output per capita

are poor in both human and physical capital.

Decreasing returns occur for the variables​

capital and labor.

Which of the following is not among the four​ tigers?

China

How would you interpret the​ left-hand side of the equation​ above?

It is the change in the capital stock per worker from year t to year t ​+ 1.

Over the last half−​century, which of the following countries has had the highest growth rate of output per​ capita?

Japan

Which of the following countries had the highest rate of growth of output per capita between 1950 and​ 2017?

Japan

Which of the following countries had the lowest level of output per capita in​ 1950?

Japan

Which of the following is true regarding the interpretation of the equation​ above?

Saving has a positive impact on the change in the level of output per worker. Depreciation is a drag on capital accumulation. The level of output per worker is a key determinant of the change in the level of capital per worker.

On a logarithmic​ scale, a variable that increases at​ 5% per year will move along an​ upward-sloping line with a slope of 0.05.

True

The aggregate production function is a relation between output on one hand and labor and capital on the other.

True

The saving rate is always equal to the investment rate.

True

The U.S. capital stock is far below the​ golden-rule level. The government should give tax breaks for saving because the U.S. capital stock is far below the​ golden-rule level.

Uncertain

The higher the saving​ rate, the higher consumption in steady state.

Uncertain

We should transform Social Security from a​ pay-as-you-go system to a fully funded system. This would increase consumption both now and in the future.

Uncertain

Which of the following countries experienced the lowest level of output per capita in​ 2017?

United Kingdom

By​ 2017, which of the following countries had the highest level of real output per​ capita?

United States

Which of the following countries had the highest level of output per capita in​ 1950?

United States

In order to write the relationship between investment and output in the form​ below, what key assumptions must we​ make?

We assume that public​ saving, T − G​, is equal to zero and that private​ saving, S​, is proportional to income.

Which of the following will cause a reduction in output per worker​ (Y/N)?

all of the above

Decreasing returns to capital​ (K) implies that a​ 4% increase in K will​ cause:

Y to increase by less than​ 4%

Suppose an economy experience a​ 4% increase in each of the following​ variables: N,​ K, and H​ (human capital). Given this​ information, we know with certainty​ that:

Y will increase by less than​ 12% but by more than​ 4%

For this​ question, assume that a country experiences a permanent reduction in its saving rate. Which of the following will occur as a result of this reduction in the saving​ rate?

a permanently lower level of output per worker

For this​ question, assume that there are decreasing returns to​ capital, decreasing returns to​ labor, and constant returns to scale. A reduction in the capital stock will cause which of the​ following?

a reduction in output.

Which of the following will NOT cause an increase in aggregate output​ (Y) in the long​ run?

a reduction in the saving rate

​Suppose, due to the effects of a military conflict that has​ ended, that a country experiences a large reduction in its capital stock. Assume no other effects of this event on the economy. Which of the following will tend to occur as the economy adjusts to this​ situation?

a relative high growth rate for some time.

The United States has one of the largest incomes per capita in the world. As other world economies experience economic​ growth, they should begin to converge with the United States. Economists see this type of convergence occurring in​ __________.

a small percentage of the economies of the world.

In the following production​ function, Y​ = f(K,​ NA), suppose A increases by​ 20%. This​ 20% increase in A implies that

all of the above.

Given the broadest interpretation of​ technology, technology will include which of the​ following?

all of the above

If the saving rate is 1​ (i.e., s​ = 1), we know​ that:

all of the above

In the absence of technological​ progress, which of the following remains constant in the steady state​ equilibrium?

all of the above

Suppose the saving rate is initially less than the golden rule saving rate. We know with certainty that a reduction in the saving rate will​ cause:

all of the above

For this​ question, assume that a country experiences a permanent increase in its saving rate. Which of the following will occur as a result of this increase in the saving​ rate?

both B and C.

If output doubles when inputs​ double, the production function will be characterized by​ _________

constant returns to scale.

This problem is based on the material in the chapter appendix. Suppose that the​ economy's production function is given by...... where Y is​ output, K is​ capital, and N is labor. Assume that α ​= 1/3. This production function is characterized by

constant returns to​ scale, because doubling inputs will double output

For this​ question, assume that there are decreasing returns to​ capital, decreasing returns to​ labor, and constant returns to scale. Now suppose that both capital and labor decrease by​ 5%. Given this​ information, we know that output​ (Y) will

decrease by​ 5%.

When steady state capital per worker is above the golden−rule ​level, we know with certainty that an increase in the saving rate will

decrease consumption in both the short run and the long run.

The relationship between output per worker and capital per work exhibits​ __________.

decreasing returns to scale.

In the following production​ function, Y​ = f(K,​ NA), a​ 20% increase in A will cause which of the following variables to increase by​ 20%?

effective labor

In the absence of technological​ progress, an increase in the saving rate will cause which of the​ following?

increase temporarily the growth of output per worker.

The capital−labor ratio will tend to decrease over time when

investment per worker is less than saving per worker.

Given the narrow interpretation of​ technology, technology will include which of the​ following?

none of the above

Over the last hundred​ years,

none of the above

When using a logarithmic scale to plot output per capita over​ time, an upward−sloping curve that becomes increasingly steep indicates

output per capita is growing by an increasing percentage each year.

Suppose there are two countries that are identical with the following exception. The saving rate in country A is greater than the saving rate in country B. Given this​ information, we know that in the long​ run:

output per capita will be greater in A than in B

During the Malthusian​ era

output per person stayed constant

Assume that employment increases by​ 3%. Holding all other factors​ constant, we know with certainty that which of the following will​ occur?

output will increase by less than​ 3%

Suppose two countries are identical in every way with the following exception. Economy A has a greater quantity of human capital than economy B. Given this​ information, we know with certainty​ that:

steady state consumption in A is higher than in B

Suppose two countries are identical in every way with the following exception. Economy A has a higher rate of depreciation ​(δ​) than economy B. Given this​ information, we know with certainty​ that:

steady state consumption in A is lower than in B

When an economy is operating at the steady​ state, we know that

steady state saving is equal to depreciation per worker.

In the absence of technological​ progress, which of the following is true when the economy is operating at the steady​ state?

the growth of output per worker is zero.

Suppose there are two countries that are identical with the following exception. The saving rate in country A is greater than the saving rate in country B. Given this​ information, we know that in the long​ run:

the growth rate of output per capita will be the same in both countries

An increase in the saving rate will NOT affect which of the following variables in the long​ run?

the growth rate of output per worker

Of the​ following, the most often used measure of changing living standards is

the growth rate of real GDP per capita.

Suppose there are two countries that are identical in every way with the following​ exception: Country A has a higher stock of human capital than country B. Given this​ information, we know with certainty​ that

the growth rate will be the same in the two countries


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