Question 1

If your firm has constant returns to scale, what would happen to your firm's output if you doubled all your inputs?

Accepted Answer

A)   It would not change.
B)   It would increase, but by less than double.
C)   It would double.
D)   It would more than double.

Question 2

What do property rights refer to?

Accepted Answer

A)   a document stating the rights of ownership that accompany owning property
B)   the ability of people to exercise authority over the resources they own
C)   the right of the government to exercise authority over property owners
D)   the right to use a common property

Question 3

What is a characteristic of inward-oriented policies?

Accepted Answer

A)   They are generally supported by economists.
B)   They are primarily concerned with the development of human capital.
C)   They are in some ways like prohibiting the use of certain technologies.
D)   They are generally rejected by domestic producers in import-competing industries.

Question 4

Over the past 100 years, Canadian real GDP per person has doubled about every 35 years. If in the next 100 years it doubles every 25 years, then what will Canadian real GDP per person be a century from now?

Accepted Answer

A)   8 times higher than it is now
B)   10 times higher than it is now
C)   12 times higher than it is now
D)   16 times higher than it is now

Question 5

From 1974 to 1982, what was the growth in Canadian productivity?

Accepted Answer

A)   0.5 percent
B)   1.3 percent
C)   1.8 percent
D)   2.5 percent

Question 6

What is generally an opportunity cost of investment in human capital?

Accepted Answer

A)   future job security
B)   forgone wages at present
C)   increased earning potential
D)   the cost of tuition during the years of school

Question 7

What indicates greater scarcity of a natural resource?

Accepted Answer

A)   an increase in its demand
B)   a decrease in its supply
C)   an increase in its price
D)   a decrease in its stock

Question 8

In a market economy, when do we know that a resource has become scarcer?

Accepted Answer

A)   when its price rises relative to other prices
B)   when it is nonrenewable and some of it is used
C)   when substitutes exist
D)   when there are no substitutes

Question 9

What would an economist call the saws, lathes, and drill presses that woodworkers at Cedar Valley Furniture use to produce chests and cabinets?

Accepted Answer

A)   human capital
B)   physical capital
C)   production resources
D)   technological knowledge

Question 10

From 1960 to 1990, the ratio of investment to GDP in South Korea was higher than in Canada and so South Korea had substantially higher growth.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following is considered human capital?

Accepted Answer

A)   better working conditions
B)   safety in the workplace
C)   the things you have learned this semester
D)   machinery that requires a human to operate

Question 12

Which statement best explains the logic behind the catch-up effect?

Accepted Answer

A)   Workers in countries with low incomes will work more hours than workers in countries with high incomes.
B)   The capital stock in rich countries deteriorates at a higher rate because it already has a lot of capital.
C)   New capital adds more to production in a country that doesn't have much capital than in a country that already has much capital.
D)   Poor countries tend to save a higher share of their income than rich countries.

Question 13

One of the ten principles of economics is that people face tradeoffs. The growth that arises from capital accumulation is not a free lunch. What is the opportunity cost of that capital accumulation?

Accepted Answer

A)   People need to work longer hours, thus having less time for leisure.
B)   People need to consume less goods and services now in order to enjoy more consumption in the future.
C)   People need to recycle resources so that future generations can produce goods and services with the accumulated capital.
D)   People need to devote less time in school and more at work.

Question 14

Why are property rights important for the growth of a nation's standard of living

Accepted Answer

Property rights are an important prerequ...

Question 15

Which of the following best describes changes in the average well-being in a country?

Accepted Answer

A)   the growth rate of the unemployed
B)   the growth rate of nominal GDP
C)   the growth rate of real GDP
D)   the growth rate of real GDP per person

Question 16

Which of the following goods does a patent turn a new idea into?

Accepted Answer

A)   a public good, which increases the incentive to engage in research
B)   a public good, which decreases the incentive to engage in research
C)   a private good, which increases the incentive to engage in research
D)   a private good, which decreases the incentive to engage in research

Question 17

All else equal, which of the following would tend to cause GDP per person to rise?

Accepted Answer

A)   high immigration growth
B)   investment in human capital
C)   rapid growth in the labour force population
D)   policies to reduce imports

Question 18

According to Malthus's view, what is a consequence of increased population?

Accepted Answer

A)   increased GDP per person
B)   more people imply more ideas and more labour force, which promotes growth
C)   depletion of productive resources and lower standards of living
D)   increase in productivity in the food sector, which is necessary to support the increase in population

Question 19

If a country's saving rate increases, what happens in the long run?

Accepted Answer

A)   Income decreases faster.
B)   Productivity increases faster.
C)   Productivity decreases.
D)   Income increases.

Question 20

What is the difference between human capital and technology

Accepted Answer

Technology is society's understanding of...

Exam 7: Production and Growth

What is a characteristic of inward-oriented policies?

Correct AnswerverifiedShow Answer

What would an economist call the saws, lathes, and drill presses that woodworkers at Cedar Valley Furniture use to produce chests and cabinets?

Correct AnswerverifiedShow Answer

One of the ten principles of economics is that people face tradeoffs. The growth that arises from capital accumulation is not a free lunch. What is the opportunity cost of that capital accumulation?

Correct AnswerverifiedShow Answer

Which of the following goods does a patent turn a new idea into?

Correct AnswerverifiedShow Answer

From 1974 to 1982, what was the growth in Canadian productivity?

Correct AnswerverifiedShow Answer

In a market economy, when do we know that a resource has become scarcer?

Correct AnswerverifiedShow Answer

What is the difference between human capital and technology

Correct AnswerverifiedTechnology is society's understanding of...View AnswerShow Answer

If your firm has constant returns to scale, what would happen to your firm's output if you doubled all your inputs?

Correct AnswerverifiedShow Answer

Which of the following is considered human capital?

Correct AnswerverifiedShow Answer

Over the past 100 years, Canadian real GDP per person has doubled about every 35 years. If in the next 100 years it doubles every 25 years, then what will Canadian real GDP per person be a century from now?

Correct AnswerverifiedShow Answer

What do property rights refer to?

Correct AnswerverifiedShow Answer

Which of the following best describes changes in the average well-being in a country?

Correct AnswerverifiedShow Answer

What is generally an opportunity cost of investment in human capital?

Correct AnswerverifiedShow Answer

According to Malthus's view, what is a consequence of increased population?

Correct AnswerverifiedShow Answer

From 1960 to 1990, the ratio of investment to GDP in South Korea was higher than in Canada and so South Korea had substantially higher growth.

Correct AnswerverifiedShow Answer

All else equal, which of the following would tend to cause GDP per person to rise?

Correct AnswerverifiedShow Answer

What indicates greater scarcity of a natural resource?

Correct AnswerverifiedShow Answer

Which statement best explains the logic behind the catch-up effect?

Correct AnswerverifiedShow Answer

Why are property rights important for the growth of a nation's standard of living

Correct AnswerverifiedProperty rights are an important prerequ...View AnswerShow Answer

If a country's saving rate increases, what happens in the long run?

Correct AnswerverifiedShow Answer

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Technology is society's understanding of...
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Correct Answer
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Property rights are an important prerequ...
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Correct Answer
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