Question 1

A system of private property rights

Accepted Answer

A)   encourages economic growth by creating incentives to invest in capital and to be innovative.
B)   discourages economic growth by discouraging the development of new ideas and ways of doing things.
C)   reduces the efficiency of government, which reduces the growth rate of the economy over time.
D)   encourages investment but discourages entrepreneurial activity, so the effect on economic growth is uncertain.E) A) and B)
F) A) and C)

Question 2

Which of the following variables can be used to measure labor productivity?

Accepted Answer

A)   real GDP
B)   number of workers
C)   number of labor hours
D)   all of the aboveE) B) and D)
F) C) and D)

Question 3

Per capita real GDP is a measure of

Accepted Answer

A)   economic welfare.
B)   cost of living standards.
C)   cultural harmony.
D)   productive activity.E) B) and C)
F) A) and D)

Question 4

Economic growth is best measured by increases in

Accepted Answer

A)   nominal personal income.
B)   nominal Gross Domestic Product (GDP) .
C)   per capita real Gross Domestic Product (GDP) .
D)   per capita nominal Gross Domestic Product (GDP) .E) All of the above
F) B) and D)

Question 5

Economic growth occurs as a result of all of the following EXCEPT

Accepted Answer

A)   more labor hours.
B)   growth of capital.
C)   technological progress.
D)   less saving.E) A) and B)
F) B) and D)

Question 6

The term "economic growth" refers to increases in

Accepted Answer

A)   resources use.
B)   nominal income.
C)   satisfaction.
D)   productive capacity.E) B) and C)
F) A) and C)

Question 7

The transformation of an invention into something that benefits the economy is known as

Accepted Answer

A)   an innovation.
B)   a patent.
C)   an externality.
D)   magical growth.E) A) and D)
F) B) and C)

Question 8

How should per capita real Gross Domestic Product (GDP)  be used?

Accepted Answer

A)   It is an accurate measure of economic well-being.
B)   It is a reasonably good measure of productive activity.
C)   Per capita real Gross Domestic Product (GDP)  is a good gauge of a nation's quality of life because it takes into account a nation's cultural and spiritual values.
D)   all of the aboveE) A) and D)
F) A) and B)

Question 9

When economic growth is compared between countries, the best measure to use is

Accepted Answer

A)   nominal GDP.
B)   real GDP.
C)   chain-weighted GDP.
D)   real GDP per capita.E) B) and D)
F) B) and C)

Question 10

Suppose a country experiences an increase in output per worker. Such a development represents which of the following?

Accepted Answer

A)   a decrease in economic growth
B)   an increase in labor productivity
C)   a reduction in the saving rate
D)   an increase in population growthE) B) and D)
F) B) and C)

Question 11

When analyzing stages of economic development in the United States, it appears that we have entered the "tertiary stage." This is a stage marked by a shift toward

Accepted Answer

A)   agriculture.
B)   manufacturing.
C)   services.
D)   population increases.E) None of the above
F) A) and D)

Question 12

Entrepreneurs often undertake the innovations that are necessary to bring inventions to the marketplace. Accordingly, what empirical pattern should be expected in an international comparison?

Accepted Answer

A)   Countries with higher rates of entrepreneurship have higher rates of poverty.
B)   Countries with higher rates of entrepreneurship have lower rates of immigration.
C)   Countries with higher rates of entrepreneurship have lower rates of economic growth.
D)   Countries that protect the property rights of entrepreneurs will have higher rates of economic growth.E) A) and D)
F) A) and B)

Question 13

How does innovation differ from invention? Why is innovation required for economic growth?

Accepted Answer

Innovation involves the transformation o...

Question 14

Institutions and laws, such as patent protection, that foster innovations lead to economic growth because they

Accepted Answer

A)   allow the government control of the innovations.
B)   give confidence to inventors that they will profit from their innovation.
C)   give confidence to consumers that the products they buy are safe.
D)   give businesses loans to buy new machinery.E) B) and C)
F) A) and D)

Question 15

Which of the following is a TRUE statement concerning economic growth?

Accepted Answer

A)   Changes in per capita nominal GDP are used to measure economic growth because population growth can distort the figures and we want to use the nominal amounts since that is what people identify with.
B)   Changes in per capita nominal GDP are used to measure economic growth, but there are serious problems concerning the desirability of using figures that do not account for pollution and urban sprawl.
C)   Changes in per capita real GDP are used to measure economic growth because this accurately measures all the differences in living standards across countries.
D)   Changes in per capita real GDP are used to measure economic growth because inflation and population growth can distort nominal GDP figures or total GDP figures.E) All of the above
F) A) and D)

Question 16

What did Malthus say about population growth?

Accepted Answer

A)   Population growth is the key to a nation's economic growth.
B)   Population growth is not a problem if food production keeps up, and Malthus predicted that it would.
C)   Population growth is a huge problem if housing and medical care don't also increase.
D)   The population would grow faster than food supplies, which would be a recipe for disaster.E) B) and C)
F) A) and B)

Question 17

-Refer to the above table. You have a choice among four alternatives. Choice A lets you invest $250,000 at 4 percent; B lets you invest $125,000 at 6 percent; C lets you invest $62,500 at 8 percent, and D lets you invest $31,250 at 10 percent. Which choice will get you to $1 million faster?

Accepted Answer

A)   A
B)   B
C)   C
D)   DE) A) and B)
F) B) and D)

Question 18

When the government grants an inventor a patent

Accepted Answer

A)   he has the exclusive right to make, sell or use his invention for 5 years.
B)   the patent holder has less incentive to invest in R&D because one successful invention removes the need to develop others.
C)   the patent holder is guaranteed a profit on his invention.
D)   the protection of a current invention would increase spending on R&D.E) All of the above
F) C) and D)

Question 19

According to the text, Ethiopia probably has a low per capita real Gross Domestic Product (GDP)  because

Accepted Answer

A)   it has too many resources.
B)   it has a corrupt government.
C)   it has a low rate of saving.
D)   there are too many skilled workers in the country.E) A) and B)
F) A) and C)

Question 20

Have Malthus' predictions about population growth come TRUE?

Accepted Answer

A)   no, because modern birth control has limited population growth in all nations
B)   yes, as evidenced by the famine and food shortages affecting every nation today
C)   no, because the world's food supply has grown much more rapidly than Malthus foresaw
D)   Yes. The world's food supply, measured by calories per person, continues to fall.E) None of the above
F) A) and B)

Exam 9: Global Economic Growth and Development

The transformation of an invention into something that benefits the economy is known as

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When economic growth is compared between countries, the best measure to use is

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A system of private property rights

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Which of the following is a TRUE statement concerning economic growth?

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Per capita real GDP is a measure of

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Institutions and laws, such as patent protection, that foster innovations lead to economic growth because they

Correct AnswerverifiedShow Answer

How should per capita real Gross Domestic Product (GDP) be used?

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Entrepreneurs often undertake the innovations that are necessary to bring inventions to the marketplace. Accordingly, what empirical pattern should be expected in an international comparison?

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Economic growth occurs as a result of all of the following EXCEPT

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When the government grants an inventor a patent

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According to the text, Ethiopia probably has a low per capita real Gross Domestic Product (GDP) because

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The term "economic growth" refers to increases in

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Suppose a country experiences an increase in output per worker. Such a development represents which of the following?

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Have Malthus' predictions about population growth come TRUE?

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When analyzing stages of economic development in the United States, it appears that we have entered the "tertiary stage." This is a stage marked by a shift toward

Correct AnswerverifiedShow Answer

What did Malthus say about population growth?

Correct AnswerverifiedShow Answer

Which of the following variables can be used to measure labor productivity?

Correct AnswerverifiedShow Answer

-Refer to the above table. You have a choice among four alternatives. Choice A lets you invest $250,000 at 4 percent; B lets you invest $125,000 at 6 percent; C lets you invest $62,500 at 8 percent, and D lets you invest $31,250 at 10 percent. Which choice will get you to $1 million faster?

Correct AnswerverifiedShow Answer

Economic growth is best measured by increases in

Correct AnswerverifiedShow Answer

How does innovation differ from invention? Why is innovation required for economic growth?

Correct AnswerverifiedInnovation involves the transformation o...View AnswerShow Answer

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Innovation involves the transformation o...
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