Macroeconomics graded assignment #5

What has been the average growth rate of U.S. real GDP per person over the past 100​ years? In which periods was growth most rapid and in which periods was it​ slowest? Over the past 100​ years, the average growth rate of U.S. real GDP per person is ______ percent. Over the past 100​ years, growth was most rapid during the​ ______ and slowest during the​ ______.

2 percent 1960s; Great Depression

In 2018​ Brazil's real GDP is growing at 1.7 percent a year and its population is growing at 0.7 percent a year. If these growth rates​ continue, in what year will​ Brazil's real GDP per person be twice what it is in​ 2018? If these growth rates​ continue, Brazil's real GDP per person will be twice what it is in 2018 in​ _______.

2088

Choose the correct statement. A. If there is a shortage of​ labor, the real wage rate falls to eliminate the shortage. B. The nominal wage influences the quantity of labor supplied because what matters to households is not the number of dollars they earn but what they can buy with those dollars. C. Each additional hour of labor increases real GDP by successively smaller amounts. D. The quantity of labor demanded in the economy during a given period depends on the quantity of labor supplied.

Each additional hour of labor increases real GDP by successively smaller amounts

Choose the correct statement. A. The real wage rate is the number of dollars that an hour of labor earns B. if there is a shortage of​ labor, the real wage rate rises to eliminate the shortage. C. The demand for labor is the relationship between the quantity of labor demanded and the money wage rate. D. The real wage rate is the money wage rate multiplied by the price level.

If there is a shortage of​ labor, the real wage rate rises to eliminate the shortage.

Choose the correct statement. A. An increase in the quantity of labor and a corresponding decrease in leisure hours will have no effect on real GDP. B. An increase in the quantity of labor and a corresponding decrease in leisure hours shifts the production function upward. C. Labor hours are not all equally productive. D. The aggregate production function is the relationship that tells us how real GDP changes as the real wage rate​ changes, when all other influences on production remain the same.

Labor hours are not all equally productive.

Choose the correct statement. A. The fundamental source of labor productivity growth is physical capital. B. The largest contribution to labor productivity growth comes from human capital. C. Growth in average hours per work increase labor productivity. D. Most technologies are embodied in physical capital.

Most technologies are embodied in physical capital.

Choose the correct statement about an increase in the population. A. The production function shifts upward. B. Potential GDP decreases. C. Potential GDP per hour of labor decreases. D. The real wage rate rises.

Potential GDP per hour of labor decreases.

Describe the gaps between real GDP per person in the United States and in other countries. For which countries is the gap​ narrowing? For which is it​ widening? For which is it the​ same? Since​ 1980, the gap between the United States and​ _______.

Russia and between the United States and Nigeria​ narrowed, the gap between the United States and Mexico​ widened, and the gap between the United States and the Europe Big 4 remained relatively constant

Choose the statements concerning neoclassical growth theory that are true. 1. Neoclassical growth theory states that growth in real GDP per person can persist indefinitely. nothing 2. Economic growth will stop if technology stops advancing. nothing 3. The rate of technological change influences the economic growth rate but economic growth does not influence the pace of technological change. 4. Neoclassical growth theory was developed in the late 19th century. nothing

Statements 2 and 3 are correct.

Choose the correct statement. A. The annual growth rate of real GDP fluctuates widely over the business cycle. B. The growth rate of potential GDP and the trend growth rate of real GDP have risen since 2000. C. The return to full employment in an expansion phase of the business cycle is economic growth. D. The annual growth rate of real GDP provides information about changes in the trend growth rate.

The annual growth rate of real GDP fluctuates widely over the business cycle.

The effect of the United States returning millions of workers to their home countries is​ _____ Mexico's production function and​ _____ in potential GDP.

a movement up​ along; an increase

According to classical growth​ theory, the growth of real GDP per person stops when​ _______. According to neoclassical growth​ theory, the growth of real GDP per person stops when​ _______. According to new growth​ theory, the growth of real GDP per person​ _______.

a population explosion eventually occurs and real GDP per person returns to the subsistence level technology stops advancing persists indefinitely

When labor productivity​ increases, there is​ _____ the production function and​ _____ in potential GDP.

an upward shift​ of; an increase

Economic growth is measured by

changes in real GDP.

An increase in the population​ ______ the real wage rate and​ ______ the equilibrium quantity of labor. Potential GDP​ ______ and potential GDP per hour of labor​ ______.

decreases; increases ​increases; decreases

In new growth theory​ ______.

discoveries result from choices

We are interested in long - term growth primarily because it brings

higher standards of living.

The aggregate production function is the relationship that tells us​ ______, when all other influences on production remain the same.

how real GDP changes as the quantity of labor changes

The fundamental source of labor productivity growth is​ ______.

human capital

An increase in the population​ ______ the equilibrium quantity of​ labor, ______ and potential GDP. An increase in the population​ _______ the real wage rate.

increases; increases lowers

The key proposition of new growth theory that makes growth persist is that​ ______ is not subject to diminishing returns.

knowledge capital

China was the largest economy for centuries because everyone had the same type of economy- subsistence -and so the country with the most people would be economically biggest. Then the Industrial Revolution sent the West on a more prosperous path. Now the world is returning to a common​ economy, this time​ technology- and​ information-based, so once again population triumphs. Why was China the​ world's largest economy until​ 1890? Why did the United States surpass China in 1890 to become the​ world's largest​ economy? China was the​ world's largest economy until 1890 because​ ______. In​ 1890, the United States surpassed China to become the​ world's largest economy because​ ______.

people in all countries had approximately the same subsistence level of income and China had the largest population the benefits of the Industrial Revolution were greater in the United States than in China

Once the preconditions for growth are in​ place, the influences on the pace of labour productivity growth are​ _______.

physical capital​ growth, human capital​ growth, and technological advances

Real GDP per person grows when​ ______.

real GDP grows at a faster rate than the population grows

According to classical growth​ theory, when real GDP per person​ ______, the population grows.

rises above the subsistence level

An increase in labor productivity​ ______.

shifts the demand for labor curve rightward and the production function upward

According to neoclassical growth​ theory, the fundamental cause of economic growth is​ ______.

technological​ change, which induces saving and investment that make capital per hour of labor grow

What is the relationship between the growth rate of real GDP and the growth rate of real GDP per​ person? The growth rate of real GDP per person​ _______.

tells us about changes in the standard of living and the growth rate of real GDP tells us how rapidly the total economy is expanding

Economic growth is​ _______. Real GDP growth rate​ = [(Real GDP in​ ______ year-Real GDP in​ ______ ​year) divided by Real GDP in​ ______ year ​] X 100.

the expansion of production possibilities ​current; previous; previous

Potential GDP is determined by​ ______.

the​ full-employment quantity of labor

The Rule of 70 states that the number of years it takes for the level of any variable to​ ______ is approximately​ ______. If real GDP per person doubles in 20​ years, then the annual growth rate of real GDP per person is​ ______ percent a year.

​double; 70 divided by the annual percentage growth rate of the variable 3.5

An increase in the population​ ______ potential GDP and​ ______ potential GDP per hour of labor.

​increases; decreases

The demand for labor is the relationship between the quantity of labor demanded and the​ ______. The supply of labor is the relationship between the quantity of labor supplied and the​ ______. The quantity of labor demanded is the number of labor hours​ _______ during a given period. The quantity of labor supplied is the number of labor hours​ _______ during a given period. Labor market equilibrium occurs​ _______.

real wage​ rate; real wage rate hired by all the firms in the​ economy; that all the households in the economy plan to work at the real wage rate at which the quantity of labor demanded equals the quantity of labor supplied

The two broad sources of potential GDP growth are growth of​ ______ and growth of​ ______.

the supply of​ labor; labor productivity