Question 1

On average, by how much does each year of schooling raise a person's wage in Canada?

Accepted Answer

A)  about 5 percent
B)  about 10 percent
C)  about 15 percent
D)  about 20 percent

Question 2

When a country removes trade barriers and exports pork chops and imports stereos, which of the following will most likely happen?

Accepted Answer

A)  Its growth will slow down.
B)  Its productivity will decrease.
C)  It will essentially be transforming pork chops into stereos.
D)  Its economic well-being will decrease, while that of the country that sells stereos will increase.

Question 3

The catch-up effect says that countries with low income can grow faster than countries with higher income. However, in statistical studies that include many diverse countries we do not observe the catch-up-effect unless we control for other variables that affect productivity. Considering the determinants of productivity, list and explain some things that would tend to prohibit or limit a poor country's ability to catch up with the rich ones.

Accepted Answer

The argument that poor countries will te...

Question 4

An increase in the saving rate does not permanently increase the growth rate of real GDP per person.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following best defines the catch-up effect?

Accepted Answer

A)  It is the idea that saving will always "catch up" with investment spending.
B)  It is the idea that it is easier for a country to grow fast and "catch up" with richer countries if it starts out relatively poor.
C)  It is the idea that rich countries aid relatively poor countries so as to help them "catch up."
D)  It is the idea that if investment spending is low, increased saving will help investment to "catch up."

Question 6

Once one person discovers an idea, the idea generally enters society's pool of knowledge. Therefore, knowledge is generally what kind of good?

Accepted Answer

A)  a societal good
B)  a private good
C)  a public good
D)  a normal good

Question 7

According to Malthus's view, which of the following 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 8

Which of the following is an example of a nonrenewable resource?

Accepted Answer

A)  coal
B)  honey
C)  livestock
D)  lumber

Question 9

The president of a developing country proposes that his country needs to help domestic firms by imposing trade restrictions. What kind of policies are these?

Accepted Answer

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

Question 10

In the 1800s, Europeans purchased stock in Canadian companies, which used the funds to build railroads and factories. What type of investments did the Europeans make?

Accepted Answer

A)  foreign portfolio investments
B)  indirect domestic investments
C)  foreign direct investments
D)  foreign indirect investments

Question 11

Which of the following does Y/L refer to?

Accepted Answer

A)  productivity
B)  output
C)  the availability of natural resources
D)  the amount of human capital

Question 12

Economists generally believe that outward-oriented policies are more likely to foster growth than inward-oriented policies.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following countries had the highest growth rate over the past 100 years?

Accepted Answer

A)  Brazil
B)  Germany
C)  Canada
D)  United States

Question 14

Which of the following terms refers to the relationship between the quantity of output created and the quantity of inputs needed to create it?

Accepted Answer

A)  the capital accumulation function
B)  technological knowledge
C)  the production function
D)  human capital

Question 15

Which of the following is considered human capital?

Accepted Answer

A)  the number of computers available in schools and universities
B)  the average percentage of income people give to charity
C)  the number of persons in the labour force
D)  knowledge acquired from on-the-job training

Question 16

Which of the following is an externality aspect of education?

Accepted Answer

A)  Education produces a return to society that is greater than the return to the individual.
B)  Education produces a return to society that is less than the return to the individual.
C)  Education produces costs to society that the individual does not take into account.
D)  Only education acquired abroad by immigrants has an externality effect.

Question 17

Over about the past 30 years, 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 18

Of the following countries, which grew the slowest between 1870 and 2003?

Accepted Answer

A)  Germany
B)  the United Kingdom
C)  Canada
D)  the United States

Question 19

Which of the following 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 20

What do economists call the equipment and structures available to produce goods and services?

Accepted Answer

A)  physical capital
B)  human capital
C)  the production function
D)  technology

Exam 7: Production and Growth

Which of the following is an externality aspect of education?

Correct Answer
verified

Which of the following countries had the highest growth rate over the past 100 years?

Correct Answer
verified

Once one person discovers an idea, the idea generally enters society's pool of knowledge. Therefore, knowledge is generally what kind of good?

Correct Answer
verified

When a country removes trade barriers and exports pork chops and imports stereos, which of the following will most likely happen?

Correct Answer
verified

Which of the following best explains the logic behind the catch-up effect?

Correct Answer
verified

Over about the past 30 years, the ratio of investment to GDP in South Korea was higher than in Canada and so South Korea had substantially higher growth.

Correct Answer
verified

Which of the following is an example of a nonrenewable resource?

Correct Answer
verified

On average, by how much does each year of schooling raise a person's wage in Canada?

Correct Answer
verified

Economists generally believe that outward-oriented policies are more likely to foster growth than inward-oriented policies.

Correct Answer
verified

Correct Answer
verified
The argument that poor countries will te...
View Answer

The president of a developing country proposes that his country needs to help domestic firms by imposing trade restrictions. What kind of policies are these?

Correct Answer
verified

What do economists call the equipment and structures available to produce goods and services?

Correct Answer
verified

According to Malthus's view, which of the following is a consequence of increased population?

Correct Answer
verified

Which of the following is considered human capital?

Correct Answer
verified

Which of the following terms refers to the relationship between the quantity of output created and the quantity of inputs needed to create it?

Correct Answer
verified

Which of the following does Y/L refer to?

Correct Answer
verified

In the 1800s, Europeans purchased stock in Canadian companies, which used the funds to build railroads and factories. What type of investments did the Europeans make?

Correct Answer
verified

An increase in the saving rate does not permanently increase the growth rate of real GDP per person.

Correct Answer
verified

Which of the following best defines the catch-up effect?

Correct Answer
verified

Of the following countries, which grew the slowest between 1870 and 2003?

Correct Answer
verified

Exam 7: Production and Growth

Which of the following is an externality aspect of education?

Correct AnswerverifiedShow Answer

Which of the following countries had the highest growth rate over the past 100 years?

Correct AnswerverifiedShow Answer

Once one person discovers an idea, the idea generally enters society's pool of knowledge. Therefore, knowledge is generally what kind of good?

Correct AnswerverifiedShow Answer

When a country removes trade barriers and exports pork chops and imports stereos, which of the following will most likely happen?

Correct AnswerverifiedShow Answer

Which of the following best explains the logic behind the catch-up effect?

Correct AnswerverifiedShow Answer

Over about the past 30 years, 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

Which of the following is an example of a nonrenewable resource?

Correct AnswerverifiedShow Answer

On average, by how much does each year of schooling raise a person's wage in Canada?

Correct AnswerverifiedShow Answer

Economists generally believe that outward-oriented policies are more likely to foster growth than inward-oriented policies.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedThe argument that poor countries will te...View AnswerShow Answer

The president of a developing country proposes that his country needs to help domestic firms by imposing trade restrictions. What kind of policies are these?

Correct AnswerverifiedShow Answer

What do economists call the equipment and structures available to produce goods and services?

Correct AnswerverifiedShow Answer

According to Malthus's view, which of the following is a consequence of increased population?

Correct AnswerverifiedShow Answer

Which of the following is considered human capital?

Correct AnswerverifiedShow Answer

Which of the following terms refers to the relationship between the quantity of output created and the quantity of inputs needed to create it?

Correct AnswerverifiedShow Answer

Which of the following does Y/L refer to?

Correct AnswerverifiedShow Answer

In the 1800s, Europeans purchased stock in Canadian companies, which used the funds to build railroads and factories. What type of investments did the Europeans make?

Correct AnswerverifiedShow Answer

An increase in the saving rate does not permanently increase the growth rate of real GDP per person.

Correct AnswerverifiedShow Answer

Which of the following best defines the catch-up effect?

Correct AnswerverifiedShow Answer

Of the following countries, which grew the slowest between 1870 and 2003?

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The argument that poor countries will te...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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