8

In five​ years, a salary of ​$54 comma 000 per year with a 5 percent growth due to cost-of-living adjustment in the fifth year would be ​$ 56700. ​(Round your response to the nearest dollar​.)

The same​ salary, with a 1 percent growth due to​ cost-of-living adjustment compounded​ yearly, would be ​$ 56755 in five years. ​(Round your response to the nearest dollar​.)

Suppose that a 10 percent increase in the physical capital stock increases GDP by 10 percent. Now consider an additional 10 percent increase in the physical capital stock.

This increase in the physical capital stock will increase GDP by LESS THAN 10%

Improvements in technology _________ run into diminishing marginal product. This is why advances in technology ________ explain major differences in income per capita across countries.

don't necessarily, can

Factors that help households decide whether to consume or save their income are​ ___________. ​(Check all that apply.​)

expectations of future income growth. expectations about taxes. the interest rate.

The saving rate in an economy is defined as the​ ____________.

fraction of total income that households save.

Based on your understanding of the​ chapter, poverty can best be reduced by​ ____________. ​(Check all that apply.​)

improving the knowledge and technologies available in the world economy. increasing international trade.

Based on the data recorded​ above, it can be seen that the government budget in the fourth quarter of 2018 was __________.

in deficit

In​ general, the subsistence level​ ____________.

is unique in each environment.

To find how long for China to catch​ up, we simply set the above equation for the United States equal to the equation for​ China

ln(41,365) + 0.0200t = ln(7,746) + 0.0472 t SO t = ln(US GDP growth rate) - ln(China GDP growth rate) / avg annual growth % of (US - China) in decimal form

The subsistence level is the​ ___________.

minimum level of income per person that is generally necessary for an individual to survive.

Rule of 70 formula

number of years to double = 70/growth rate

Exponential growth is the​ ____________.

process by which new growth builds on past​ growth, leading to a​ (roughly) constant growth rate.

​Catch-up growth is the​ ____________.

process by which relatively poorer nations increase their incomes by taking advantage of the knowledge and technologies already invented in other technologically advanced nations.

Sustained growth is the​ ____________.

process where GDP per capita grows at a positive and relatively steady rate for long periods of time.

Based on the​ video, __________ can disguise the wide variations in living standards within a country. An example is _________, where _________ is comparable to​ Italy, and _________ has rural areas that have the same health and wealth as Ghana.

regional differences China Shanghai Guizhou

The change in gross saving from the fourth quarter of 2013 to the fourth quarter of 2018 would be displayed in the figure to the right as a ___________ curve.

rightward shifting supply

An interesting study of the slowdown has been done by Yale economist William​ Nordhaus, which is summarized at ​blahhhh. The two main conclusions that Nordhaus reaches concerning the 1970s slowdown are​ ___________ and​ ___________. ​(Check only two​.)

the 1970s energy crises accounted for approximately​ two-thirds of the slowdown. the productivity slowdown was not unique.

The changes in technology that serve as the basis for the sustained growth we observe today began with​ ____________.

the Industrial Revolution.

An example of sustained growth is​ ____________.

the United​ States, which demonstrated sustained growth between 1820 and 2007.

Which of the following statements do not correctly describe exponential​ growth? ​(Check all that​ apply.)

the growth rate fluctuates drastically. the growth rate keeps increasing each year.

Economic growth is​ ____________.

the increase in income​ (GDP) per capita of an economy.

All of the following statements concerning countries undergoing​ catch-up growth are true except​ _________.

they must develop technologies that other countries will import.

Increasing taxes is the only way that government saving can be increased.

this claim is FALSE

The Malthusian cycle​ ___________.

was common prior to the Industrial Revolution.

The Letting the Data Speak box on levels versus growth points out how one important index of health-life expectancyl-has changed in various countries over time. To see a dramatic animation of the data mentioned in the​ box, go to blah Hans Rosling is an expert in global health and is known for his creative presentation of statistics. Watch the brief​ video, and answer the following questions. The upper limit on life expectancy in almost all countries in 1810 was ____ years.

40

The graph on the right shows an index of world GDP per capita from 1000 BC to the year 2000. As you can​ see, over most of that​ period, global economic growth was virtually nonexistent. While there were periods that experienced some increase in per capita​ income, sustained growth begins only in the mid-18th ​century, and explodes after that--by the year​ 2000, income per capita is 12 times what it had been 250 years before. The dramatic change in economic growth beginning in the 18th century may be accounted for by

A & C only

Which countries failed to improve much in life expectancy and income as a result of the Industrial​ Revolution? ​(Check all that apply​.)

Africa. Asia.

The following table lists GDP per capita from 1970 to 2010 for South Korea and the United States. As you can ​see, both grew substantially over that​ 40-year period. Interpret the differences you see in the two graphs. (nonproportional vs proportional scale)

All of the above.

As of​ 2009, most ________ and some __________ countries had made great improvements in life expectancy and​ income, and most people were __________.

Asian, African, in the middle

Which industries were most affected by the​ slowdown? ​(Check all that apply​.)

Auto repair. Oil and gas extraction. Pipelines.

Which of the following are examples of a technological​ change? ​(Check all that​ apply.)

Firm A increased production after discovering that some of its new employees can operate an old-fashioned machine which was sitting idle. Firm A introduces a new product after incorporating feedback from its customers and the research and development team.

Which factors explain economic growth in the United States over the past few​ decades? ​(Check all that apply.​)

Human capital ​(H​). Physical capital ​(K​). Technology ​(A​).

Which were some of the countries that had not made much improvement in either measure by​ 1948? ​(Check all that apply​.)

India. China. Bangladesh.

Before​ 1800, a pattern developed showing that increases in aggregate income led to an expanding​ population, which in turn reduced income per capita and put downward pressure on the population. This pattern is known as the​ ___________.

Malthusian cycle.

Does an increase in GDP per capita of a nation imply that all its citizens have become​ richer?

No, because the average income per capita of a nation is not the same as the income of each individual in that nation.

Amidst discussions on budget cuts to rein in the U.S. fiscal​ deficit, some commentators were of the opinion that foreign aid spending should be reduced. Others felt that reducing foreign aid would adversely affect the recipient countries. How effective has foreign aid been in reducing​ poverty?

Not very​ effective, because the aid has not been directed at activities that increase sustained growth.

Over the past 200​ years, the U.S. economy has shown​ ____________.

Over the past 200​ years, the U.S. economy has shown​ ____________.

Based on the data in Exhibit​ 1, indicate which factors are most responsible for the overall decline in the annual growth rate of GDP per hour worked in these two decades.

Physical capital Not responsible Human capital Responsible Technology Responsible

What countries still lagged​ behind? ​(Check all that apply​.)

South Africa. Congo.

An example of​ catch-up growth is​ ____________.

South​ Korea, which by 1970 had become poorer relative to the United​ States, but over the last 40 years grew faster than the United​ States, closing the gap that had opened up previously.

Which factor is the most important contributor to growth in the United​ States?

Technology ​(A​).

Which two countries were slightly better​ off? ​(Check two countries​.)

The Netherlands. Britain.

What is the major reason for these industries being the most​ affected?

The energy crises in the 1970s.

What factors explain the dramatic increases in life expectancy that we saw in most countries in the twentieth​ century? ​(Select all that apply​.)

The establishment of simple but effective medical and public health practices. Innovations in disease​ control, including the use of DDT against malaria. Scientific breakthroughs leading to the development of antibiotics and vaccines.

Household saving decisions impact investment in the economy by having​ ___________.

a direct impact on​ investment, as saving is correlated with investment.

All of the following are factors in determining the subsistence level of an economy except​ ____________.

air

Gross saving in the economy is composed of gross private saving and gross government saving. This latter magnitude reflects the condition of the​ government's ____________.

budget

The exponential nature of technological knowledge ensures that innovations improve productive capacity in GDP by a _________.

constant percentage

Furthermore, compared to the fourth quarter of 2013​, the saving effort by government has _________.

decreased

Using the figure to the​ right, this latter observation​ indicates, on the assumption of constant gross private​ saving, that the level of investment in the economy will be __________.

decreased

GDP per capita __________ account for​ distribution; consequently, economic growth may actually reduce ___________.

does not equality

From January​, 2014 to January​, 2019​, real GDP per capita increased at an average annual rate of 1.95​%. ​

formula rgdp2019/rgdp2014^1/5 - 1

The term efficiency units of labor is the​ ____________.

product of the number of workers and the level of human capital.

Economic growth refers to the increase in ______ GDP per capita of an economy. Assume GDP per capita in constant dollars was ​$30,250 for 2003 and ​$39,250 for 2004.

real In this​ case, the​ economy's growth rate would be 29.8% ((39250-30250)/30250)

In the loanable funds market displayed in the​ figure, gross saving is represented by the _________ loanable funds.

supply of

As of​ 1948, disparities in life expectancy and income between countries had _______.

widened