Question 1

Over the period 1900-2014, Brazil's rate of economic growth exceeded that of China.

Accepted Answer

A) True 
 B)False

Question 2

In 2010, the imaginary nation of Mainland had a population of 6,000 and real GDP of 120,000. In 2011 the population was 6,200 and real GDP of 128,960. Over the year in question, real GDP per person in Mainland grew by

Accepted Answer

A)  2 percent, which is high compared to average U.S. growth over the last one-hundred years.
B)  2 percent, which is about the same as average U.S. growth over the last one-hundred years.
C)  4 percent, which is high compared to average U.S. growth over the last one-hundred years.
D)  4 percent, which is about the same as average U.S. growth over the last one-hundred years.E) A) and D)
F) C) and D)

Question 3

In 2009, the imaginary nation of Mainland had a population of 7,000 and real GDP of 210,000. In 2010 the population was 7,300 and real GDP of 223,380. Over the year in question, real GDP per person in Mainland grew by

Accepted Answer

A)  2 percent, which is high compared to average U.S. growth over the last one-hundred years.
B)  2 percent, which is about the same as average U.S. growth over the last one-hundred years.
C)  4 percent, which is high compared to average U.S. growth over the last one-hundred years.
D)  4 percent, which is about the same as average U.S. growth over the last one-hundred years.E) All of the above
F) A) and D)

Question 4

Daniel owns a coffee kiosk. All of his employees work 8 hours per day. In 2011, he employed 6 people who produced a total of 912 cups of coffee each day. In 2012, he hired a seventh employee and production increased to 1008 cups of coffee each day. In Daniel's kiosk, productivity

Accepted Answer

A)  increased by about 10.5 percent
B)  increased by 9.5 percent
C)  decreased by about 5.6 percent
D)  decreased by about 5.3 percentE) None of the above
F) All of the above

Question 5

Country A has twice as many workers as Country B. Country A also has twice as much physical capital, twice as much human capital, and access to twice as many natural resources as Country B. Assuming constant-returns to scale, which of the following is higher in Country A?

Accepted Answer

A)  both output per worker and productivity
B)  output per worker but not productivity
C)  productivity but not output per worker
D)  neither productivity nor output per workerE) B) and D)
F) B) and C)

Question 6

In 2010, the imaginary nation of Bovina had a population of 5,000 and real GDP of 500,000. In 2011 it had a population of 5,100 and real GDP of 520,200. During 2011 real GDP per person in Bovina grew by

Accepted Answer

A)  2 percent, which is high compared to average U.S. growth over the last one-hundred years.
B)  2 percent, which is about the same as average U.S. growth over the last one-hundred years.
C)  4 percent, which is high compared to average U.S. growth over the last one-hundred years.
D)  4 percent, which is about the same as average U.S. growth over the last one-hundred years.E) C) and D)
F) A) and D)

Question 7

Other things the same, another unit of capital will increase output by more in a poor country than in a rich country.

Accepted Answer

A) True 
 B)False

Question 8

The return to schooling for society is higher than the return to schooling for the individual if

Accepted Answer

A)  the concept of diminishing returns applies to education.
B)  the concept of constant returns to scale applies to education.
C)  human capital conveys positive externalities.
D)  investment in human capital involves no opportunity costs.E) A) and B)
F) A) and C)

Question 9

Which of the following statements is true?

Accepted Answer

A)  Productivity is calculated as hours worked divided by output produced.
B)  Americans have a higher standard of living than Indonesians because American workers are more productive than Indonesian workers.
C)  Both A and B are correct.
D)  None of the above are correct.E) B) and D)
F) A) and D)

Question 10

If Country A produces 7,000 units of goods and services using 700 hours of labor, and if Country B produces 5,500 units of goods and services using 500 units of labor, then productivity is lower in Country A than in Country B.

Accepted Answer

A) True 
 B)False

Question 11

Studies confirm that controlling for other variables such as the percentage of GDP devoted to investment, poor countries tend to grow at a faster rate than rich countries.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following can be measured by the level of real GDP per person?

Accepted Answer

A)  productivity and the standard of living
B)  productivity but not the standard of living
C)  the standard of living but not productivity
D)  neither the standard of living nor productivityE) C) and D)
F) All of the above

Question 13

Suppose a country imposes new restrictions on how many hours people can work. If these restrictions reduce the total number of hours worked in the economy, but all other factors that determine output are held fixed, then

Accepted Answer

A)  productivity and output both rise.
B)  productivity rises and output falls.
C)  productivity falls and output rises.
D)  productivity and output fall.E) A) and B)
F) A) and C)

Question 14

Last year a country had 800 workers who worked an average of 8 hours and produced 12,800 units. This year the same country had 1000 workers who worked an average of 8 hours and produced 14,000 units. This country's productivity was

Accepted Answer

A)  higher this year than last year. A possible source of this change in productivity is a change in the size of the capital stock.
B)  higher this year than last year. A change in the size of the capital stock does not affect productivity.
C)  lower this year than last year. A possible source of this change in productivity is a change in the size of the capital stock.
D)  lower this year than last year. A change in the size of the capital stock does not affect productivity.E) B) and D)
F) C) and D)

Question 15

If a production function has the property called __________, then doubling all inputs causes the amount of output to double as well.

Accepted Answer

constant r...

Question 16

Country A had a population of 1,000, of whom 600 worked an average of 8 hours a day and had a productivity of 2.5. Country B had a population of 800, of whom 560 worked 8 hours a day and had productivity of 3.0. Country

Accepted Answer

A)  A had the higher level of real GDP and real GDP per person.
B)  A had the higher level of real GDP and Country B had the higher level of real GDP per person
C)  B had the higher level of real GDP and Country A had the higher level of real GDP per person
D)  B had the higher level of real GDP and real GDP per person.E) A) and C)
F) A) and B)

Question 17

Two countries are the same, except one is poorer. Assuming the traditional assumption about the production function is made there are

Accepted Answer

A)  diminishing returns to capital so the poor country grows slower.
B)  increasing returns to capital so the poor country grows slower.
C)  diminishing returns to capital so the poor country grows faster.
D)  increasing returns to capital so the poor country grows faster.E) B) and C)
F) A) and D)

Question 18

Janet is a farmer. Which of the following are included in her human capital?

Accepted Answer

A)  her tractor and what she's learned from experience
B)  her tractor but not what she's learned from experience
C)  what she's learned from experience but not her tractor
D)  neither her tractor nor what she's learned from experienceE) B) and D)
F) All of the above

Question 19

Technological knowledge

Accepted Answer

A)  is the same thing as human capital.
B)  can be discovered but it can never be kept secret.
C)  is a determinant of productivity.
D)  does not play a role in the relationship that economists call the production function.E) A) and C)
F) C) and D)

Question 20

Mexico is

Accepted Answer

A)  a poor country, and over the past century its rate of economic growth has been higher than that of the United States.
B)  a poor country, and over the past century its rate of economic growth has been lower than that of the United States.
C)  a middle-income country, and over the past century its rate of economic growth has been higher than that of the United States.
D)  a middle-income country, and over the past century its rate of economic growth has been lower than that of the United States.E) All of the above
F) A) and B)

Exam 25: Production and Growth

Last year a country had 800 workers who worked an average of 8 hours and produced 12,800 units. This year the same country had 1000 workers who worked an average of 8 hours and produced 14,000 units. This country's productivity was

Correct AnswerverifiedShow Answer

Studies confirm that controlling for other variables such as the percentage of GDP devoted to investment, poor countries tend to grow at a faster rate than rich countries.

Correct AnswerverifiedShow Answer

In 2009, the imaginary nation of Mainland had a population of 7,000 and real GDP of 210,000. In 2010 the population was 7,300 and real GDP of 223,380. Over the year in question, real GDP per person in Mainland grew by

Correct AnswerverifiedShow Answer

The return to schooling for society is higher than the return to schooling for the individual if

Correct AnswerverifiedShow Answer

Country A has twice as many workers as Country B. Country A also has twice as much physical capital, twice as much human capital, and access to twice as many natural resources as Country B. Assuming constant-returns to scale, which of the following is higher in Country A?

Correct AnswerverifiedShow Answer

In 2010, the imaginary nation of Bovina had a population of 5,000 and real GDP of 500,000. In 2011 it had a population of 5,100 and real GDP of 520,200. During 2011 real GDP per person in Bovina grew by

Correct AnswerverifiedShow Answer

If Country A produces 7,000 units of goods and services using 700 hours of labor, and if Country B produces 5,500 units of goods and services using 500 units of labor, then productivity is lower in Country A than in Country B.

Correct AnswerverifiedShow Answer

Which of the following statements is true?

Correct AnswerverifiedShow Answer

Suppose a country imposes new restrictions on how many hours people can work. If these restrictions reduce the total number of hours worked in the economy, but all other factors that determine output are held fixed, then

Correct AnswerverifiedShow Answer

Other things the same, another unit of capital will increase output by more in a poor country than in a rich country.

Correct AnswerverifiedShow Answer

If a production function has the property called __________, then doubling all inputs causes the amount of output to double as well.

Correct Answerverifiedconstant r...View AnswerShow Answer

Two countries are the same, except one is poorer. Assuming the traditional assumption about the production function is made there are

Correct AnswerverifiedShow Answer

Technological knowledge

Correct AnswerverifiedShow Answer

In 2010, the imaginary nation of Mainland had a population of 6,000 and real GDP of 120,000. In 2011 the population was 6,200 and real GDP of 128,960. Over the year in question, real GDP per person in Mainland grew by

Correct AnswerverifiedShow Answer

Janet is a farmer. Which of the following are included in her human capital?

Correct AnswerverifiedShow Answer

Daniel owns a coffee kiosk. All of his employees work 8 hours per day. In 2011, he employed 6 people who produced a total of 912 cups of coffee each day. In 2012, he hired a seventh employee and production increased to 1008 cups of coffee each day. In Daniel's kiosk, productivity

Correct AnswerverifiedShow Answer

Over the period 1900-2014, Brazil's rate of economic growth exceeded that of China.

Correct AnswerverifiedShow Answer

Country A had a population of 1,000, of whom 600 worked an average of 8 hours a day and had a productivity of 2.5. Country B had a population of 800, of whom 560 worked 8 hours a day and had productivity of 3.0. Country

Correct AnswerverifiedShow Answer

Mexico is

Correct AnswerverifiedShow Answer

Which of the following can be measured by the level of real GDP per person?

Correct AnswerverifiedShow Answer

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