Question 1

If Ernest Rutherford died and left $8000 to be invested for a period of 100 years to benefit medical students and scientific research, how often would this money double if it were to earn 5 per cent per year for all years?

Accepted Answer

A)  every 10 years
B)  every 14 years
C)  every seven years
D)  every five yearsE) B) and D)
F) All of the above

Question 2

The output per worker equation Y/L = A F(1, K/L, H/L, N/L)  provides a mechanical summary of the four determinants of:

Accepted Answer

A)  technology
B)  diminishing returns
C)  catch-up effect
D)  productivityE) A) and C)
F) A) and D)

Question 3

The amount that a nation trades with others is determined by:

Accepted Answer

A)  geography
B)  the availability of natural sea ports
C)  government policy
D)  all of the aboveE) A) and C)
F) B) and C)

Question 4

The production function is given as Y = AF(L, K, H, N) , where Y is the quantity of output, A is the level of available production technology, L is the quantity of labour, H is the quantity of human capital and N is the quantity of natural resources.This equation provides:

Accepted Answer

A)  a summary for the four determinants of productivity
B)  a summary for the four determinants of production
C)  a foundation for measuring inflation
D)  a measure of the availability of natural resourcesE) C) and D)
F) None of the above

Question 5

The word productivity refers to:

Accepted Answer

A)  the quantity of goods and services that a worker can produce in a year
B)  the quantity of goods and services that a worker can produce in a day
C)  the quantity of goods and services that a worker can produce for each hour of work
D)  the quantity of goods and services that a nation produces in a yearE) C) and D)
F) A) and B)

Question 6

The production function curve can be used to illustrate diminishing returns to capital.

Accepted Answer

A) True 
 B)False

Question 7

Productivity is a measure of:

Accepted Answer

A)  the amount of goods and services produced from each worker in a given year
B)  the amount of goods and services produced per person in the country
C)  the amount of goods and services produced from each hour of a worker's time
D)  the amount of goods and services produced by a country relative to another countryE) B) and D)
F) C) and D)

Question 8

Suppose that the average weekly income in a nation was $120 in 1952, and the growth rate of average income is 3.5 per cent per year.About how high will average national weekly income be in 2012?

Accepted Answer

Using the rule of 70, we determine that ...

Question 9

Which of the following make economic growth certain?

Accepted Answer

A)  property rights
B)  democracies
C)  markets
D)  no factor can guarantee economic growthE) A) and D)
F) None of the above

Question 10

A production function shows the relationship between:

Accepted Answer

A)  the quantity of inputs used in production and the quantity of output from production
B)  gross domestic product and national income
C)  workers as inputs and consumers as buyers
D)  production and spendingE) C) and D)
F) All of the above

Question 11

Why is capital growth incapable of accounting for sustained productivity growth?

Accepted Answer

Because of diminishing returns...

Question 12

An economy can increase its real rate of economic growth by increasing consumption and debt creation.

Accepted Answer

A) True 
 B)False

Question 13

The term constant returns to scale refers to:

Accepted Answer

A)  none of the below
B)  a situation where increasing all inputs by a multiple results in no change in the output
C)  a situation where increasing all inputs by a multiple results in the output being increased by more than that multiple
D)  a situation where increasing all inputs by a multiple results in the output being increased by the same multipleE) C) and D)
F) B) and C)

Question 14

Is there statistical evidence that shows correlations between investment and economic growth, and between population growth and economic growth across countries, where growth is defined in terms of per-capita GDP? Does this evidence prove a causal relationship?

Accepted Answer

There is a positive statistical correlat...

Question 15

Physical capital is:

Accepted Answer

A)  the knowledge and skills that workers acquire while using machinery and tools
B)  the stock of equipment and structures that are used to produce goods and services
C)  education, training and experience
D)  land, rivers and mineral depositsE) C) and D)
F) B) and D)

Question 16

While Africa should have grown faster than other developing areas because of its relatively low income per head, it has grown more slowly.This was because some of its countries had policies of:

Accepted Answer

A)  higher trade barriers
B)  low tax rates
C)  excessive saving rates
D)  all of the aboveE) None of the above
F) B) and C)

Question 17

New Zealand was the first country to sign a free trade agreement with China.What would be the reason for this, from the point of view of both parties?

Accepted Answer

China would have to produce all its own ...

Question 18

The historical data show that:

Accepted Answer

A)  the world's poorest countries have remained in poverty
B)  the world's richest countries have no guarantee that they will stay the richest
C)  living standards have not varied widely from country to country
D)  the world's poorest countries could always catch up with the world's richest countriesE) B) and D)
F) B) and C)

Question 19

Countries have tried various methods to increase their living standards by reducing population growth.As an economist interested in incentives rather than coercion, what kind of policy would you recommend to slow population growth?

Accepted Answer

Since bearing a child has an opportunity...

Question 20

A production function describes the relationship between the quantity of inputs used in production and the quantity of output from production.

Accepted Answer

A) True 
 B)False

Exam 26: Production and Growth

The word productivity refers to:

Correct AnswerverifiedShow Answer

The amount that a nation trades with others is determined by:

Correct AnswerverifiedShow Answer

New Zealand was the first country to sign a free trade agreement with China.What would be the reason for this, from the point of view of both parties?

Correct AnswerverifiedChina would have to produce all its own ...View AnswerShow Answer

Physical capital is:

Correct AnswerverifiedShow Answer

An economy can increase its real rate of economic growth by increasing consumption and debt creation.

Correct AnswerverifiedShow Answer

While Africa should have grown faster than other developing areas because of its relatively low income per head, it has grown more slowly.This was because some of its countries had policies of:

Correct AnswerverifiedShow Answer

If Ernest Rutherford died and left $8000 to be invested for a period of 100 years to benefit medical students and scientific research, how often would this money double if it were to earn 5 per cent per year for all years?

Correct AnswerverifiedShow Answer

Productivity is a measure of:

Correct AnswerverifiedShow Answer

The production function is given as Y = AF(L, K, H, N) , where Y is the quantity of output, A is the level of available production technology, L is the quantity of labour, H is the quantity of human capital and N is the quantity of natural resources.This equation provides:

Correct AnswerverifiedShow Answer

Is there statistical evidence that shows correlations between investment and economic growth, and between population growth and economic growth across countries, where growth is defined in terms of per-capita GDP? Does this evidence prove a causal relationship?

Correct AnswerverifiedThere is a positive statistical correlat...View AnswerShow Answer

The term constant returns to scale refers to:

Correct AnswerverifiedShow Answer

The production function curve can be used to illustrate diminishing returns to capital.

Correct AnswerverifiedShow Answer

Which of the following make economic growth certain?

Correct AnswerverifiedShow Answer

Countries have tried various methods to increase their living standards by reducing population growth.As an economist interested in incentives rather than coercion, what kind of policy would you recommend to slow population growth?

Correct AnswerverifiedSince bearing a child has an opportunity...View AnswerShow Answer

Suppose that the average weekly income in a nation was $120 in 1952, and the growth rate of average income is 3.5 per cent per year.About how high will average national weekly income be in 2012?

Correct AnswerverifiedUsing the rule of 70, we determine that ...View AnswerShow Answer

The historical data show that:

Correct AnswerverifiedShow Answer

A production function describes the relationship between the quantity of inputs used in production and the quantity of output from production.

Correct AnswerverifiedShow Answer

The output per worker equation Y/L = A F(1, K/L, H/L, N/L) provides a mechanical summary of the four determinants of:

Correct AnswerverifiedShow Answer

Why is capital growth incapable of accounting for sustained productivity growth?

Correct AnswerverifiedBecause of diminishing returns...View AnswerShow Answer

A production function shows the relationship between:

Correct AnswerverifiedShow Answer

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China would have to produce all its own ...
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There is a positive statistical correlat...
View Answer

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Since bearing a child has an opportunity...
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Using the rule of 70, we determine that ...
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Correct Answer
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Because of diminishing returns...
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Correct Answer
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