Question 1

A nation's annual growth rate of real GDP per person is 2 percent.Its standard of living will

Accepted Answer

A)  double in 35 years.
B)  not change because its population is growing.
C)  fall because of its population growth.
D)  double in 10 years.
E)  double in 50 years.

Question 2

Economic freedom requires

Accepted Answer

A)  that there are no regulations and restrictions set on businesses and households by the government.
B)  the rule of law and the ability to enforce the laws.
C)  strong labor unions.
D)  freedom to bribe government officials.
E)  that the government be a democracy.

Question 3

Suppose France's real GDP grew from $750 billion in 2010 to $821 billion in 2011.What was the growth rate of France's real GDP?

Accepted Answer

A)  10 percent
B)  9.5 percent
C)  9.1 percent
D)  8.6 percent
E)  $71 billion

Question 4

Which of the following statements is FALSE?

Accepted Answer

A)  Saving helps create economic growth.
B)  Improvements in quality of education are important for economic growth.
C)  Free international trade helps create economic growth.
D)  Faster population growth is the key to growth in real GDP per person.
E)  Economic freedom requires property rights.

Question 5

A reason for an increase in labor productivity growth is

Accepted Answer

A)  an increase in people's human capital.
B)  a decrease in the capital stock so that firms must hire more workers.
C)  growth in the supply of labor.
D)  an increase in the population so that firms hire more workers.
E)  an increase in the quantity of labor.

Question 6

Economic freedom provides the

Accepted Answer

A)  political system that encourages democracy.
B)  social system that supports families.
C)  production system that discourages property rights.
D)  incentive system that encourages growth-producing activities.
E)  necessary alternative to free markets.

Question 7

Labor productivity is defined as

Accepted Answer

A)  total real GDP.
B)  real GDP per person.
C)  total output multiplied by total hours of labor.
D)  real GDP per hour of labor.
E)  hours of work per person.

Question 8

An important condition required for economic growth is

Accepted Answer

A)  a democratic government.
B)  a totalitarian government.
C)  a libertarian government.
D)  economic freedom.
E)  the incentive to limit international trade so that all economic growth remains within the country.

Question 9

According to the production function,as the quantity of labor employed increases,real GDP increases

Accepted Answer

A)  at an increasing rate.
B)  at a decreasing rate.
C)  at a constant rate.
D)  and then eventually decreases.
E)  until it reaches potential GDP,and then it no longer changes.

Question 10

Increases in human capital can come

Accepted Answer

A)  only from formal schooling.
B)  from employing more machinery.
C)  only from on-the-job experience.
D)  from formal education and on-the-job learning.
E)  from nowhere because whatever human capital an individual possesses is what he or she was born with.

Exam 17: Potential Gdp and Economic Growth

Economic freedom provides the

Correct Answer
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An important condition required for economic growth is

Correct Answer
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According to the production function,as the quantity of labor employed increases,real GDP increases

Correct Answer
verified

Economic freedom requires

Correct Answer
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Suppose France's real GDP grew from $750 billion in 2010 to $821 billion in 2011.What was the growth rate of France's real GDP?

Correct Answer
verified

Increases in human capital can come

Correct Answer
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Which of the following statements is FALSE?

Correct Answer
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Labor productivity is defined as

Correct Answer
verified

A reason for an increase in labor productivity growth is

Correct Answer
verified

A nation's annual growth rate of real GDP per person is 2 percent.Its standard of living will

Correct Answer
verified

Exam 17: Potential Gdp and Economic Growth

Economic freedom provides the

Correct AnswerverifiedShow Answer

An important condition required for economic growth is

Correct AnswerverifiedShow Answer

According to the production function,as the quantity of labor employed increases,real GDP increases

Correct AnswerverifiedShow Answer

Economic freedom requires

Correct AnswerverifiedShow Answer

Suppose France's real GDP grew from $750 billion in 2010 to $821 billion in 2011.What was the growth rate of France's real GDP?

Correct AnswerverifiedShow Answer

Increases in human capital can come

Correct AnswerverifiedShow Answer

Which of the following statements is FALSE?

Correct AnswerverifiedShow Answer

Labor productivity is defined as

Correct AnswerverifiedShow Answer

A reason for an increase in labor productivity growth is

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A nation's annual growth rate of real GDP per person is 2 percent.Its standard of living will

Correct AnswerverifiedShow Answer

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