Macro Unit 6
To graphically show economic growth at full employment we could draw
rightward shift of the LRAS curve and an outward shift of the PPC/PPF
Many USA producers believe an economy's productive capacity can be categorized by
specialization and division of labor
If an economy has real GDP of $10,000,000 and a population of 100 in Year 1 and real GDP at $10,500,000 and a population of 120 in Year 2, we would say that the economic growth as measured by real GDP per capita from Year 1 to Year 2 was
-12.5% (Final GDP pc - Inital GDP pc)/(initial GDP pc)
If an economy has real GDP of $10,000,000 in Year 1 and a population of 100 real GDP of $10,500,000 and a population of 120 in year 2, we would say that the real GDP per capita for Year 1 was
$100,000
A country will double its GDP in twenty years if its annual growth rate is
3.5 percent
Assuming a country's economy maintains an 8% rate of growth, young adults starting at age 20 would see the average standard of living in their country more than double by the time they had reached age __________.
30
In certain African countries like Niger, Tanzania, Nigeria, and Sudan, for example, GDP per capita at the start of the 2000s was still less than $___________.
300
If an economy has real GDP of $10,000,000 in Year 1 and real GDP of $10,500,000 in Year 2, we would say that the economic growth in real GDP from year 1 to year 2 was
5%
When discussing economic growth it is often useful to focus on ______ to avoid studying changes in the size of the GDP that represent only having more people in the economy and focus on those increases in GDP which represent an actual rise in the standard of living on a per person basis
GDP per capita
Which of the following is correct
Increased education adds to the stock of human capital, not unlike building factories adds to the stock of physical capital.
Which of the following best describes the relationship between economic growth and literacy
Increased literacy stimulates economic growth by raising labor productivity and as the economy grows, people consume more education
______ is output per hour in the business sector
Productivity
The largest increases in economic growth since 1980 have occurred in
Southeast Asia
_______________________ is a term which refers to the widespread use of power-driven machinery and the economic and social changes that resulted in the first half of the 1800s
The Industrial Revolution
A company's productive capacity is often graphically represented by
a vertical LRAS curve
An economy's production capacity is often graphically represented by
a vertical LRAS curve
In macroeconomics, the connection from inputs to outputs for the entire economy is called
an aggregate production function
Which of the following factors contribute to economic growth
an increase in the proportion of the population that is college educated
When society has a higher level of capital per person, it is called
capital deepening
IF AD was unchanging while the LRAS increased, the general price level would most likely
decrease
Country Able and Country Baker initially have the same real GDP per capita. Country Able experiences no economic growth, while Country Baker grows at a sustained rate of 7 percent. In 12 years, Country Baker's GDP will be approximately ___________ that of Country Able.
double
Often, the USA federal and state governments intervene in the economy in order to promote In the USA we generally use real GDP to measure
economic growth
A major goal of USA economic policy makers is to increase the economy's productive capacity at full
employment
In order to foster innovation and technological advances, governments
enforce intellectual property rights
Some recent economic research has suggested the African countries; economic growth many have been limited by
geography and climate
In the long run, the most important source of increase in a nation's standard of living is a:
high rate of economic growth
Which of the government policies below is most unlikely to encourage per capita economic growth Which of the following is most likely to contribute to economic growth as measured by GDP per capita
high taxes on companies that spend a lot on capital formation increased capital formation
If AD increased while LRAS was unchanging the general price level would most likely
increase
Tax breaks for companies investing in research and development are usually intended to Subsidies for the production of productivity-enhancing machines are usually intended to
increase AS
over the last 100 years, the USA capital has
increased faster than population
Over the last 60 years, the greatest contributors to economic growth in the USA
innovation and education
Investment in human capital
is characterized by both b) and c)
A nation can achieve higher economic growth if
it devotes more resources to research and development
A nation can achieve higher economic growth if:
it devotes more resources to research and development.
Which of the following did not result in economic growth
many citizens emigrating from Zimbabwe when a politically repressive regime took office
In general, the ultimate goal for producers is to increase productivity in order to produce
more with fewer resources
The statement: "economic growth needs to stop because it is so devastating to the environment" is an example of
normative economics
Country Alpha and Country Beta initially have the same real GDP per capita. Country Alpha experiences no economic growth, while Country Beta grows at a sustained rate of 5 percent. In 14 years, Country Alpha's GDP will be approximately _________ that of Country Beta.
one-half
Over the long run, ____________ per hour is the most important determinant of the average wage level in any economy. The value of what is produced per worker or per hour worked is called The ratio of output per unit of input
productivity
Economists typically measure economic growth by tracking
real GDP per capita
Since the late 1950s, economists have performed "growth accounting" studies in the United States. These have determined that ________________ is typically the most important contributor to U.S. economic growth.
technology
Which of the following is unlikely to affect the rate of economic growth
the level of government spending
Increased investment alone will guarantee economic growth.
this is a false statement because economic growth hinges on the quality and type of investment as well as the human capital and improvements in technology