macro review for exam 3

The classical form of the production function states that

Output = f(L, K)

The government decides to subsidize the development of a new communications network. It is acting in its role to promote economic growth by:

enhancing physical and human capital.

Developed nations tend to have

limited labor supplies but lots of capital

If the Bureau of Economic Analysis reports that the annualized U.S. growth rate was 2.5% for the second quarter, then the actual growth rate from the first quarter to the second quarter was:

.625%

If an economy's GDP will double in 25 years, then its growth rate must be about?

2.8%

Which of the following factors is NOT generally viewed by economists as critical to economic growth? a. access to large amounts of natural resources b. strong and fair legal system economic freedom stable monetary system

a

According to Malthus, a fixed quantity of land and a growing human population will eventually produce:

a stationary state in which growth will cease.

Developing countries can achieve higher productivity per unit of capital because they can use technologies developed by other countries. This is known as the:

catch up effect

The recent global financial instability:

caused severe credit crunches. - All of the answers are correct. slowed down economic growth. harmed standards of living.

The ability to use physical resources in creative ways to produce goods and services is known as

entrepreneurial ability, technology, and ideas

According to the classical model, which of the following developments does NOT contribute to economic growth?

higher interest rates

The relationship between economic freedom and per capita GDP is:

positive

Over the past century, when worker productivity rose:

real wages rose.

A production function

shows the output that is produced using different combinations of inputs combined with existing technology

Which of the following would promote long-run economic growth?

technological advancement

What is the primary explanation for the rapid growth of the U.S. economy over the last century?

technological progress

If a country's population increases at a higher rate than the growth in its real GDP?

the standard of living in the country has declined.

Which is NOT an example of infrastructure? the federal highway system airports Walmart stores the Hoover Dam

walmart stores