Question 1

Thomas Edison received patents on many of his inventions. While the patents existed, his ideas were

Accepted Answer

A)   public goods and proprietary knowledge.
B)   public goods but not proprietary knowledge.
C)   private goods and proprietary knowledge.
D)   private goods but not proprietary knowledge.E) A) and C)
F) C) and D)

Question 2

Over the last century, U.S. real GDP per person grew at a rate of about

Accepted Answer

A)   2 percent per year, so that it is now 2 times as high as it was a century ago.
B)   2 percent per year, so that it is now 8 times as high as it was a century ago.
C)   4 percent per year, so that it is now 2 times as high as it was a century ago.
D)   4 percent per year, so that it is now 8 times as high as it was a century ago.E) B) and D)
F) None of the above

Question 3

Of the following countries, which grew most slowly, in terms of real GDP per person, over the last 100 years?

Accepted Answer

A)   Brazil
B)   Mexico
C)   China
D)   United StatesE) A) and B)
F) All of the above

Question 4

Which of the following are residents of rich countries likely to have in greater quantities, or better quality, than residents of poor countries?

Accepted Answer

A)   housing
B)   healthcare
C)   life expectancy
D)   All of the above.E) A) and C)
F) All of the above

Question 5

What is a production function? Write an equation for a typical production function, and explain what each of the terms represents.

Accepted Answer

A production function is a mathematical ...

Question 6

Indonesians, for example, have a lower standard of living than Americans because they have a lower level of productivity.

Accepted Answer

A) True 
 B)False

Question 7

Human capital is the term economists use to refer to the knowledge and skills that workers acquire through education, training, and experience.

Accepted Answer

A) True 
 B)False

Question 8

Upland has a population of 15,000, of whom 9,000 work 8 hours a day to produce real output of $342,000. Lowland has a population of 8,000, of whom 7,000 work 7 hours a day to produce real output of $171,500.

Accepted Answer

A)   Upland has higher productivity and higher real GDP per person than Lowland.
B)   Upland has higher productivity but lower real GDP per person than Lowland.
C)   Upland has lower productivity but higher real GDP per person than Lowland.
D)   Upland has lower productivity and lower real GDP per person than Lowland.E) C) and D)
F) A) and D)

Question 9

Human capital is

Accepted Answer

A)   the same thing as technological knowledge.
B)   the same thing as labor.
C)   the tools and equipment operated by humans.
D)   knowledge and skills that workers have acquired.E) B) and D)
F) C) and D)

Question 10

Suppose over the last year that the price of copper increased from ore increased from $1.70 a pound to $1.79 per pound. Over the same time a measure of the overall price level increased from 300 to 309. The price of copper increased by

Accepted Answer

A)   less than inflation, and this means it became relatively less scarce.
B)   less than inflation, and this means it became scarcer.
C)   more than inflation, and this means it became scarcer.
D)   more than inflation, but this doesn't necessarily mean that it become scarcer.E) A) and B)
F) B) and D)

Question 11

Which of the following is human capital?

Accepted Answer

A)   a student loan
B)   understanding how to use a company's accounting software
C)   training videos for new corporate employees
D)   All of the above are correct.E) A) and D)
F) A) and C)

Question 12

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) B) and C)
F) None of the above

Question 13

The equipment and structures available to produce goods and services are called

Accepted Answer

A)   physical capital.
B)   human capital.
C)   the production function.
D)   technology.E) A) and C)
F) A) and B)

Question 14

At first patents might seem like a deterrent to growth because in effect they restrict the use of new technology. Yet many economists believe that patents generate growth. Explain why.

Accepted Answer

Once someone comes up with an idea it is...

Question 15

In 1870, the richest country in the world was

Accepted Answer

A)   the United States.
B)   Spain.
C)   the United Kingdom.
D)   Germany.E) A) and B)
F) C) and D)

Question 16

Average income has been stagnant for many years in

Accepted Answer

A)   Gabon.
B)   Ireland.
C)   Singapore.
D)   All of the above are correct.E) B) and D)
F) All of the above

Question 17

Real GDP per person is $30,000 in Country A, $20,000 in Country B, and $11,000 in Country C. Saving per person is $1,000 in all three countries. Other things equal, we would expect that

Accepted Answer

A)   all three countries will grow at the same rate.
B)   Country A will grow the fastest.
C)   Country B will grow the fastest.
D)   Country C will grow the fastest.E) B) and C)
F) B) and D)

Question 18

In a market economy, scarcity of resources is most clearly reflected in

Accepted Answer

A)   supply.
B)   demand.
C)   market prices.
D)   the stock of the resource.E) All of the above
F) A) and C)

Question 19

The average income in a rich country

Accepted Answer

A)   is about 5 times that in a poor country. Further, people in rich countries have longer life expectancy.
B)   is about 5 times that in a poor country. However, people in rich countries have about the same life expectancy as those in poor countries.
C)   is more than ten times that in a poor country. Further, people in rich countries have longer life expectancy.
D)   is more than ten times that in poor country. However, people in rich countries have about the same life expectancy as those in poor countries.E) A) and D)
F) A) and C)

Question 20

A leading environmental group recently published a report contending that humans are running a "resource deficit" because we are using natural resources faster than they can be regenerated. The group claims that this means that economic growth will eventually stop, and will even be reversed. An economist would

Accepted Answer

A)   agree with the report, and would point to rising natural resource prices as evidence.
B)   agree with the report, but wouldn't think it was important because growth will not slow down for several centuries.
C)   disagree with the report, in part because it ignores the mitigating effects of technological change.
D)   disagree with the report because labor and capital are the primary determinants of growth, and since they are plentiful, growth will not slow down.E) None of the above
F) A) and D)

Exam 7: Production and Growth

What is a production function? Write an equation for a typical production function, and explain what each of the terms represents.

Correct Answer
verified
A production function is a mathematical ...
View Answer

Which of the following is human capital?

Correct Answer
verified

Over the last century, U.S. real GDP per person grew at a rate of about

Correct Answer
verified

Thomas Edison received patents on many of his inventions. While the patents existed, his ideas were

Correct Answer
verified

In a market economy, scarcity of resources is most clearly reflected in

Correct Answer
verified

In 1870, the richest country in the world was

Correct Answer
verified

Human capital is the term economists use to refer to the knowledge and skills that workers acquire through education, training, and experience.

Correct Answer
verified

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 Answer
verified

Suppose over the last year that the price of copper increased from ore increased from $1.70 a pound to $1.79 per pound. Over the same time a measure of the overall price level increased from 300 to 309. The price of copper increased by

Correct Answer
verified

Upland has a population of 15,000, of whom 9,000 work 8 hours a day to produce real output of $342,000. Lowland has a population of 8,000, of whom 7,000 work 7 hours a day to produce real output of $171,500.

Correct Answer
verified

The average income in a rich country

Correct Answer
verified

Indonesians, for example, have a lower standard of living than Americans because they have a lower level of productivity.

Correct Answer
verified

At first patents might seem like a deterrent to growth because in effect they restrict the use of new technology. Yet many economists believe that patents generate growth. Explain why.

Correct Answer
verified
Once someone comes up with an idea it is...
View Answer

Correct Answer
verified

Average income has been stagnant for many years in

Correct Answer
verified

Human capital is

Correct Answer
verified

Which of the following are residents of rich countries likely to have in greater quantities, or better quality, than residents of poor countries?

Correct Answer
verified

The equipment and structures available to produce goods and services are called

Correct Answer
verified

Real GDP per person is $30,000 in Country A, $20,000 in Country B, and $11,000 in Country C. Saving per person is $1,000 in all three countries. Other things equal, we would expect that

Correct Answer
verified

Of the following countries, which grew most slowly, in terms of real GDP per person, over the last 100 years?

Correct Answer
verified

Exam 7: Production and Growth

What is a production function? Write an equation for a typical production function, and explain what each of the terms represents.

Correct AnswerverifiedA production function is a mathematical ...View AnswerShow Answer

Which of the following is human capital?

Correct AnswerverifiedShow Answer

Over the last century, U.S. real GDP per person grew at a rate of about

Correct AnswerverifiedShow Answer

Thomas Edison received patents on many of his inventions. While the patents existed, his ideas were

Correct AnswerverifiedShow Answer

In a market economy, scarcity of resources is most clearly reflected in

Correct AnswerverifiedShow Answer

In 1870, the richest country in the world was

Correct AnswerverifiedShow Answer

Human capital is the term economists use to refer to the knowledge and skills that workers acquire through education, training, and experience.

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

Suppose over the last year that the price of copper increased from ore increased from $1.70 a pound to $1.79 per pound. Over the same time a measure of the overall price level increased from 300 to 309. The price of copper increased by

Correct AnswerverifiedShow Answer

Upland has a population of 15,000, of whom 9,000 work 8 hours a day to produce real output of $342,000. Lowland has a population of 8,000, of whom 7,000 work 7 hours a day to produce real output of $171,500.

Correct AnswerverifiedShow Answer

The average income in a rich country

Correct AnswerverifiedShow Answer

Indonesians, for example, have a lower standard of living than Americans because they have a lower level of productivity.

Correct AnswerverifiedShow Answer

At first patents might seem like a deterrent to growth because in effect they restrict the use of new technology. Yet many economists believe that patents generate growth. Explain why.

Correct AnswerverifiedOnce someone comes up with an idea it is...View AnswerShow Answer

Correct AnswerverifiedShow Answer

Average income has been stagnant for many years in

Correct AnswerverifiedShow Answer

Human capital is

Correct AnswerverifiedShow Answer

Which of the following are residents of rich countries likely to have in greater quantities, or better quality, than residents of poor countries?

Correct AnswerverifiedShow Answer

The equipment and structures available to produce goods and services are called

Correct AnswerverifiedShow Answer

Real GDP per person is $30,000 in Country A, $20,000 in Country B, and $11,000 in Country C. Saving per person is $1,000 in all three countries. Other things equal, we would expect that

Correct AnswerverifiedShow Answer

Of the following countries, which grew most slowly, in terms of real GDP per person, over the last 100 years?

Correct AnswerverifiedShow Answer

Correct Answer
verified
A production function is a mathematical ...
View Answer

Correct Answer
verified

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Correct Answer
verified
Once someone comes up with an idea it is...
View Answer

Correct Answer
verified

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Correct Answer
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