Question 1

Which of the following is a part of your economics professor's human capital?

Accepted Answer

A)   the things she learned at some prestigious university
B)   her copy of Mankiw's text
C)   her chalk holder
D)   All of the above are correct.E) A) and B)
F) A) and C)

Question 2

In a market economy, the real, or inflation-adjusted, price of a resource measures its

Accepted Answer

A)   contribution to revenue.
B)   relative scarcity.
C)   productivity.
D)   contribution to efficiency.E) C) and D)
F) A) and B)

Question 3

John and Miguel are fishermen. When they go fishing, John consistently catches 2 or 3 fish per hour, while Miguel consistently catches 5 or 6 fish per hour. Miguel's _______ exceeds that of John.

Accepted Answer

The answer of John and Miguel are fishermen. When they...

Question 4

Technological knowledge refers to

Accepted Answer

A)   human capital.
B)   available information on how to produce things.
C)   resources expended transmitting society's understanding to the labor force.
D)   All of the above are technological knowledge.E) C) and D)
F) B) and D)

Question 5

In which of the following cases can we be certain that a natural resource has become scarcer?

Accepted Answer

A)   both the demand for the resource and the supply of the resource have increased
B)   both the demand for the resource and the supply of the resource have decreased
C)   demand for the resource is unchanged and the supply of the resource has increased
D)   the demand for the resource has decreased and the supply of the resource is unchangedE) B) and C)
F) A) and C)

Question 6

What is the distinction between foreign direct investment and foreign portfolio investment?

Accepted Answer

A capital investment that is owned and o...

Question 7

In the long run, a higher saving rate

Accepted Answer

A)   cannot increase the capital stock.
B)   increases the growth rate of income.
C)   increases the growth rate of productivity.
D)   None of the above is correct.E) B) and D)
F) A) and B)

Question 8

If your firm's production function has constant returns to scale and you increase all your inputs by 60%, then your firm's output will

Accepted Answer

A)   not change.
B)   increase, but by less than 60%
C)   increase by 60%
D)   increase by more than 60%.E) A) and C)
F) A) and B)

Question 9

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 10

Economist Robert Fogel focused on which of the following factors as one determinant of long-run economic growth?

Accepted Answer

A)   education
B)   research and development
C)   nutrition
D)   trade restrictionsE) C) and D)
F) A) and D)

Question 11

If a good has become more scarce, then we know for sure that

Accepted Answer

A)   the demand for it increased.
B)   the supply of it decreased.
C)   either the demand for it increased or the supply of it decreased.
D)   both the supply of it and the demand for it decreased.E) None of the above
F) A) and C)

Question 12

Which of the following can explain faster growth of real GDP in country A than in Country B?

Accepted Answer

A)   both greater population growth and greater productivity growth in Country A
B)   greater population growth in Country A, but not greater productivity growth in Country A
C)   greater productivity growth in Country A, but not greater population growth in Country A
D)   neither greater population growth nor greater productivity growth in Country AE) A) and C)
F) B) and C)

Question 13

Country A has a population of 1,000, of whom 800 work 8 hours a day to make 128,000 final goods. Country B has a population of 2,000, of whom 1,800 work 6 hours a day to make 270,000 final goods.

Accepted Answer

A)   Country A has higher productivity and higher real GDP per person than country B.
B)   Country A has lower productivity and lower real GDP per person than country B.
C)   Country A has higher productivity, but lower real GDP per person than country B.
D)   Country B has lower productivity, but higher real GDP per person than country B.E) All of the above
F) A) and D)

Question 14

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 15

If there are constant returns to scale, the production function can be written as

Accepted Answer

A)   xY = 2xAFL, K, H, N) .
B)   Y/L = A FxL, xK, xH, xN) .
C)   Y/L = A F 1, K/L, H/L, N/L) .
D)   L = AFY, K, H, N) .E) A) and B)
F) A) and C)

Question 16

Average income has been stagnant for many years in

Accepted Answer

A)   Western European counties.
B)   some Asian countries like South Korea and Singapore.
C)   some Sub-Saharan African countries.
D)   All of the above are correct.E) B) and D)
F) A) and C)

Question 17

In 2010, income per person in the United States was about 14 times that in India.

Accepted Answer

A) True 
 B)False

Question 18

The president of Suldinia, a developing country, proposes that his country needs to help domestic firms by reducing trade restrictions.

Accepted Answer

A)   These are outward-oriented policies and most economists believe they would have beneficial effects on growth in Suldinia.
B)   These are outward-oriented policies and most economists believe they would have adverse effects on growth in Suldinia.
C)   These are inward-oriented policies and most economists believe they would have beneficial effects on growth in Suldinia.
D)   These are inward-oriented policies and most economists believe they would have adverse effects on growth in Suldinia.E) B) and D)
F) B) and C)

Question 19

Workland has a population of 10,000, of whom 7,000 work 8 hours a day to produce a total of 224,000 final goods. Laborland has a population of 5,000, of whom 3,000 work 7 hours a day to produce a total of 105,000 final goods.

Accepted Answer

A)   Workland has higher productivity and higher real GDP per person than Laborland.
B)   Workland has higher productivity but lower real GDP per person than Laborland.
C)   Workland has lower productivity but higher real GDP per person than Laborland.
D)   Workland has lower productivity and lower real GDP per person than Laborland.E) None of the above
F) C) and D)

Question 20

Productivity

Accepted Answer

A)   is nearly the same across countries, and so provides no help explaining differences in the standard of living across countries.
B)   explains very little of the differences in the standard of living across countries.
C)   explains some, but not most of the differences in the standard of living across countries.
D)   explains most of the differences in the standard of living across countries.E) C) and D)
F) A) and B)

Exam 17: Production and Growth

Country A has a population of 1,000, of whom 800 work 8 hours a day to make 128,000 final goods. Country B has a population of 2,000, of whom 1,800 work 6 hours a day to make 270,000 final goods.

Correct AnswerverifiedShow Answer

If your firm's production function has constant returns to scale and you increase all your inputs by 60%, then your firm's output will

Correct AnswerverifiedShow Answer

Which of the following can explain faster growth of real GDP in country A than in Country B?

Correct AnswerverifiedShow Answer

If a good has become more scarce, then we know for sure that

Correct AnswerverifiedShow Answer

Economist Robert Fogel focused on which of the following factors as one determinant of long-run economic growth?

Correct AnswerverifiedShow Answer

Which of the following is a part of your economics professor's human capital?

Correct AnswerverifiedShow Answer

What is the distinction between foreign direct investment and foreign portfolio investment?

Correct AnswerverifiedA capital investment that is owned and o...View AnswerShow Answer

John and Miguel are fishermen. When they go fishing, John consistently catches 2 or 3 fish per hour, while Miguel consistently catches 5 or 6 fish per hour. Miguel's _______ exceeds that of John.

Correct AnswerverifiedShow Answer

In which of the following cases can we be certain that a natural resource has become scarcer?

Correct AnswerverifiedShow Answer

Workland has a population of 10,000, of whom 7,000 work 8 hours a day to produce a total of 224,000 final goods. Laborland has a population of 5,000, of whom 3,000 work 7 hours a day to produce a total of 105,000 final goods.

Correct AnswerverifiedShow Answer

In a market economy, the real, or inflation-adjusted, price of a resource measures its

Correct AnswerverifiedShow Answer

Average income has been stagnant for many years in

Correct AnswerverifiedShow Answer

Technological knowledge refers to

Correct AnswerverifiedShow Answer

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

The president of Suldinia, a developing country, proposes that his country needs to help domestic firms by reducing trade restrictions.

Correct AnswerverifiedShow Answer

If there are constant returns to scale, the production function can be written as

Correct AnswerverifiedShow Answer

In 2010, income per person in the United States was about 14 times that in India.

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

Productivity

Correct AnswerverifiedShow Answer

In the long run, a higher saving rate

Correct AnswerverifiedShow Answer

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A capital investment that is owned and o...
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A production function is a mathematical ...
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