Chapter 13 Why Do Economies Grow?

| November 9, 2018

21)
Which of the following creates difficulties in making comparisons of real GDP
across nations?
A)
Each nation has a different population.
B)
Nations produce different goods and services.
C)
Relative prices differ sharply across countries.
D)
Nations often have different languages.

22)
In making accurate comparisons of GDP across countries, it is important to take
differences in ________ into account.
A)
population size
B)
the average age of the population
C)
family size
D)
all of the above

23)
Convergence refers to closing the gap in ________ between poorer countries and
richer countries.
A)
real GDP
B)
real GDP per capita
C)
the growth rate in real GDP
D)
the growth rate in real GDP per capita

24)
A comparison of the average growth rates across time for developed nations
indicates that
A)
nations with lower levels of income grow more slowly than those with higher
levels of income.
B)
nations with lower levels of income will never be as rich as nations with high
levels of income.
C)
nations with high levels of income experience a continuously increasing growth
rate.
D)
nations with lower levels of income grow more quickly than those with higher
levels of income.

25)
Nations with low levels of GDP per capita may converge to richer nations if
A)
nations with high levels of income experience a continuously increasing growth
rate.
B)
nations with lower levels of income grow more quickly than those with higher
levels of income.
C)
nations with lower levels of income spend less on investment.
D)
nations with lower levels of income grow more slowly than those with higher
levels of income.

26)
If a nation with a low level of GDP per capita converges to a richer nation,
the poor nation
A)
experiences low growth rates.
B)
enters into a free trade agreement with the richer nation.
C)
experiences a rate of high growth such that its GDP per capita increases to
that of the richer nation.
D)
experiences a rate of low growth such that its GDP per capita increases to that
of the richer nation.

27)
Most economists believe that convergence of GDP per capita ________ between
developed nations and ________ between developing and developed nations.
A)
has occurred; has occurred
B)
has not occurred; has occurred
C)
has occurred; has not occurred
D)
has not occurred; has not occurred

28)
Technological progress is one of the mechanisms by which economies can grow.

29)
Capital deepening is the only mechanism by which economies can grow.

30)
The real GDP per capita allows economic comparison between countries.

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