Ch 12

For a given level of technology, we should expect an increase in labor productivity within a nation when there is an increase in each of the following except

labor

When a nation has very little income per person,

it has the potential to grow relatively quickly due to the catch up effect

Once a country is wealthy,

it may be harder for it to grow quickly because of the diminishing returns to capital

The world's rich countries, such as the United States and Germany, have income per person that is about _____ times income per person in the world's poor countries, such as Pakistan and India.

10

Over the past century, real GDP per person in the United States has grown about _____ percent per year, meaning it has roughly doubled every _____ years.

2, 35

If real income per person in 2018 is $18,073 and real income per person in 2019 is $18,635, what is the growth rate of real income over this period?

3.1 percent

Which of the following policies would lead to greater productivity in the printing industry? Check all that apply.

Encouraging saving by allowing workers to set aside a portion of their earnings in tax free retirement accounts Subsidizing research and development into new printing technologies

When the Japanese car maker Toyota expands one of its car factories in the United States, what is the likely impact of this event on the gross domestic product and gross national product of the United States?

GDP and GNP both rise but GDP rises by more

Which of the following expenditures to enhance productivity is most likely to emit a positive externality?

Susan pays her college tuition

Which of the following is an example of foreign portfolio investment?

Toyota buys stock in Ford, and Ford uses the proceeds to build a new plant in Michigan

The opportunity cost of growth is

a reduction in current consumption

If Mazda builds a new plant in Illinois,

a. in the future US GDP will rise more than US GNP

Thomas Malthus argued that

an ever-increasing population is constrained only by the food supply, resulting in chronic famines

Over the past century, ________ has experienced particularly strong growth, and ________ has experienced particularly weak growth.

japan, the united kingdom

If a production function exhibits constant returns to scale,

doubling all of the inputs doubles output

Because capital is subject to diminishing returns, higher saving and investment do not lead to higher

growth in the long run

Which of the following government policies is least likely to increase growth in Africa?

increase restrictions on the importing of Japanese automobiles and electronics

Increases in the amount of human capital in the economy tend to ________ real incomes because they increase the ________ of labor.

increase, productivity

To increase growth, governments should do all of the following except

nationalize major industries

Most economists are ________ that natural resources will eventually limit economic growth. As evidence, they note that the prices of most natural resources, adjusted for overall inflation, have tended to ________ over time.

not concerned, fall

Our standard of living is most closely related to

our productivity because our income is equal to what we produce

Thomas Robert Malthus believed that population growth would

put stress on the economy's ability to produce food, dooming humans to remain in poverty.

A reasonable measure of the standard of living in a country is

real income per person

China, Japan, and Brazil are growing very quickly because

they save and invest an unusually high percentage of their real income