Question 1

Suppose there are two countries that are identical with the following exception.The saving rate in country A is greater than the saving rate in country B.Given this information,we know that in the long run

Accepted Answer

A)  output per capita will be greater in B than in A.
B)  output per capita will be greater in A than in B.
C)  economic growth will be higher in A than in B.
D)  more information is needed to answer this question.

Question 2

First,what are the primary determinants of output per worker? And second,to what extent can each cause a permanent change in economic growth?

Accepted Answer

The two primary determinants of growth a...

Question 3

For this question,assume that a country experiences a permanent increase in its saving rate.Which of the following will occur as a result of this increase in the saving rate?

Accepted Answer

A)  a permanently faster growth rate of output
B)  a permanently higher level of output per capita
C)  a permanently higher level of capital per worker
D)  all of the above
E)  both B and C.

Question 4

"Leapfrogging" refers to

Accepted Answer

A)  the typical irregular pattern of growth: rapid in some decades,and almost non-existent in others.
B)  the tendency for a country's output per capita to catch up to,and then exceed,that of another country.
C)  "one-upsmanship" by politicians who use growth statistics to help win elections.
D)  the increased likelihood that a country with very high growth will have a recession,during which some other country will have the highest growth rate.
E)  the interchangeability of capital and labor in the aggregate production function.

Question 5

Which of the following will cause a reduction in output per worker in the long run run?

Accepted Answer

A)  capital accumulation or technological progress
B)  capital accumulation
C)  an increase in the number of workers
D)  expansionary monetary policy
E)  none of the above

Question 6

Which of the following will cause a reduction in output per worker (Y / N) ?

Accepted Answer

A)  a reduction in the capital stock (K) 
B)  a reduction in the saving rate
C)  a reduction in K / N
D)  all of the above

Question 7

Suppose individuals wish to obtain the most accurate comparison of living standards between the Canada and Saudi Arabia.To do so,one would convert Saudi Arabian output into dollars using

Accepted Answer

A)  the current nominal exchange rate.
B)  the current real exchange rate.
C)  the prior year's real exchange rate.
D)  an average of the last five years' exchange rates.
E)  purchasing power parity methods.

Question 8

Graphically show and explain the effects of an improvement in the state of technology.

Accepted Answer

An improvement in technology s...

Question 9

Suppose there are two countries that are identical with the following exception.The saving rate in country A is greater than the saving rate in country B.Given this information,we know that in the long run

Accepted Answer

A)  the growth rate of output per capita will be greater in B than in A.
B)  the growth rate of output per capita will be greater in A than in B.
C)  the capital-labor ratios (K / N) will be the same in both countries.
D)  the growth rate of output per capita will be the same in both countries.

Question 10

For this question,assume that the saving rate decreases.We know that this decrease in the saving rate will cause which of the following?

Accepted Answer

A)  a temporary decrease in the level of output per capita
B)  no permanent change in the level of output per capita
C)  a temporary decrease in the rate of growth of output per capita
D)  a permanently lower rate of growth of output per capita
E)  none of the above

Question 11

Which of the following countries had the highest level of output per capita in 1950?

Accepted Answer

A)  United States
B)  France
C)  Japan
D)  United Kingdom

Question 12

Assume that constant returns to scale exists and that N and K both increase by 2%.Given this information,we know that

Accepted Answer

A)  output (Y) will increase by 4%.
B)  Y will increase by 2%.
C)  Y will increase by less than 2%.
D)  Y will increase by less than 4% and more than 2%.

Question 13

Briefly explain what effect an increase in the saving rate will have on growth.

Accepted Answer

An increase in the saving rate will incr...

Question 14

Is it possible for a country to experience a permanent increase in output per worker over time? If so,how can this occur?

Accepted Answer

Yes,it is possible for sustain...

Question 15

Assume that constant returns to scale exists and that N and K both decrease by 3%.Given this information,we know that

Accepted Answer

A)  output (Y) will decrease 6%.
B)  Y will decrease by 3%.
C)  Y will decrease by less than 3%.
D)  the capital-labor ratio (K / N) will decrease.

Question 16

Briefly explain the relationship between output per capita and happiness.Specifically,to what extent are these two variables related?

Accepted Answer

Research by Richard Layard indicates tha...

Question 17

Over the last hundred years,

Accepted Answer

A)  movements in output due to recessions and recoveries dominate the movement caused by long-run growth.
B)  output has decreased in as many years as it has increased.
C)  U.S.output has approximately doubled.
D)  all of the above
E)  none of the above

Question 18

For this question,assume that there are decreasing returns to capital,decreasing returns to labor,and constant returns to scale.Now suppose that both capital and labor decrease by 5%.Given this information,we know that output (Y) will

Accepted Answer

A)  not change.
B)  decrease by less than 5%.
C)  decrease by 5%.
D)  the reduction in Y will be more than 5% but less than 10%
E)  none of the above

Question 19

In the OECD countries,there is a negative relationship between output per capita in 1950 and

Accepted Answer

A)  growth since 1950.
B)  output per capita in the 1990s.
C)  distance from the equator.
D)  population.
E)  none of the above

Question 20

Which of the following countries had the highest rate of growth of output per capita between 1950 and 2009?

Accepted Answer

A)  United States
B)  France
C)  Japan
D)  United Kingdom

Exam 10: The Facts of Growth

Which of the following will cause a reduction in output per worker in the long run run?

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"Leapfrogging" refers to

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Suppose there are two countries that are identical with the following exception.The saving rate in country A is greater than the saving rate in country B.Given this information,we know that in the long run

Correct AnswerverifiedShow Answer

First,what are the primary determinants of output per worker? And second,to what extent can each cause a permanent change in economic growth?

Correct AnswerverifiedThe two primary determinants of growth a...View AnswerShow Answer

For this question,assume that a country experiences a permanent increase in its saving rate.Which of the following will occur as a result of this increase in the saving rate?

Correct AnswerverifiedShow Answer

Which of the following will cause a reduction in output per worker (Y / N) ?

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Assume that constant returns to scale exists and that N and K both increase by 2%.Given this information,we know that

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Briefly explain the relationship between output per capita and happiness.Specifically,to what extent are these two variables related?

Correct AnswerverifiedResearch by Richard Layard indicates tha...View AnswerShow Answer

Is it possible for a country to experience a permanent increase in output per worker over time? If so,how can this occur?

Correct AnswerverifiedYes,it is possible for sustain...View AnswerShow Answer

Over the last hundred years,

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Graphically show and explain the effects of an improvement in the state of technology.

Correct AnswerverifiedAn improvement in technology s...View AnswerShow Answer

In the OECD countries,there is a negative relationship between output per capita in 1950 and

Correct AnswerverifiedShow Answer

Briefly explain what effect an increase in the saving rate will have on growth.

Correct AnswerverifiedAn increase in the saving rate will incr...View AnswerShow Answer

Which of the following countries had the highest level of output per capita in 1950?

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Which of the following countries had the highest rate of growth of output per capita between 1950 and 2009?

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Assume that constant returns to scale exists and that N and K both decrease by 3%.Given this information,we know that

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For this question,assume that the saving rate decreases.We know that this decrease in the saving rate will cause which of the following?

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Suppose individuals wish to obtain the most accurate comparison of living standards between the Canada and Saudi Arabia.To do so,one would convert Saudi Arabian output into dollars using

Correct AnswerverifiedShow Answer

Suppose there are two countries that are identical with the following exception.The saving rate in country A is greater than the saving rate in country B.Given this information,we know that in the long run

Correct AnswerverifiedShow Answer

For this question,assume that there are decreasing returns to capital,decreasing returns to labor,and constant returns to scale.Now suppose that both capital and labor decrease by 5%.Given this information,we know that output (Y) will

Correct AnswerverifiedShow Answer

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The two primary determinants of growth a...
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Research by Richard Layard indicates tha...
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Yes,it is possible for sustain...
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Correct Answer
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An improvement in technology s...
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An increase in the saving rate will incr...
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