Chapter 13 Why Do Economies Grow?

| November 9, 2018

1)
An event that allows the economy to operate more efficiently by producing more
outputs without using any more inputs is referred to as
A)
absolute progress.
B)
efficiency progress.
C)
capital investment.
D)
technological progress.

2)
Which of the following is NOT an example of technological progress?
A)
an increase in the labor supply as the result of population growth
B)
the development of laser eye surgery
C)
the invention of the microwave oven
D)
the development of smart phones

3)
Which of the following is NOT an example of technological progress?
A)
builders constructing a new office building that uses less energy
B)
an increase in Florida’s orange crop resulting from a mild winter
C)
the invention of wireless Internet access
D)
the development of blue tooth headsets

4)
Which of the following is an example of technological progress?
A)
an increase in corn output resulting from genetic engineering
B)
the invention of the air conditioner
C)
the invention of LCD televisions
D)
all of the above

5)
According to Robert Solow, the production function should be written as
A)
Y = F(K, L).
B)
Y = F(K, L, A).
C)
Y = F(K, A).
D)
Y = F(A, L).

6)
Growth accounting refers to the method used to
A)
identify the contribution of economic growth from increased capital, labor, and
technological progress.
B)
identify the costs of promises made by the government today but paid for by
future generations.
C)
measure the growth in the labor force.
D)
measure growth in the capital stock.

7)
According to the method of growth accounting, which of the following contribute
to economic growth?
A)
capital growth
B)
labor growth
C)
technological progress
D)
all of the above

8)
Suppose the growth rate of GDP in the United States is 4.2%. If 2.9% and 1.3%
of GDP growth are due, respectively, to capital and labor growth, the amount
resulting from technological progress is
A)
0%.
B)
1.3%.
C)
2.9%.
D)
4.2%.

9)
Suppose the growth rate of GDP in the United States is 4.2%. If 1.1% and 1.4%
of GDP growth are due, respectively, to capital and labor growth, the amount
resulting from technological progress is
A)
0.3%.
B)
1.1%.
C)
1.4%.
D)
1.7%.

Recall
the Application about growth in China and India to answer the following
question(s). From 1978 to 2004, China grew at a rate of 9.3% per year and India
grew at a rate of 5.4% per year.

10)
Recall the application. Based on the analysis of the sources of growth in China
and India, and assuming that nothing changes, it can be concluded that
A)
India’s long-term growth prospects are not as strong those for China.
B)
the growth rate in China should significantly slow down in the near future, but
the growth rate in India will continue to rapidly increase in the near and
distant future.
C)
there is convergence between the nations in Asia.
D)
China’s reliance on technology for economic growth makes it less likely to keep
pace with the growth rate in India.

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