Deck 2: The Us Economy: A Global View

Question 1

Those who are interested in assessing the relative standard of living of different countries over a given time period are most likely to look at

A)GDP.
B)Percentage change in GDP.
C)Population.
D)Per capita GDP.

Answer 1

D

Question 2

Per capita GDP will rise if GDP

A)Increases more rapidly than the population increases.
B)Increases at the same rate as the population increases.
C)Decreases and the population increases.
D)Increases more slowly than the population increases.

Answer 2

A

Question 3

Which of the following countries (or regions)produces the most output annually?

A)Japan.
B)United States.
C)China.
D)Germany.

Answer 3

B

Question 4

Per capita GDP is

A)The sum of consumer goods,investment goods,government services,and net exports.
B)A dollar measure of the economic growth rate of a country.
C)The value of the factors of production used to produce output in a country.
D)GDP divided by total population.

Question 5

Approximately how much of the world's output does the United States produce?

A)4 percent.
B)20 percent.
C)30 percent.
D)1.5 percent.

Question 6

Which of the following is an indicator of how much output the average person would get if all output were divided up evenly among the population?

A)GDP.
B)Nominal GDP.
C)Per capita GDP.
D)Real GDP.

Question 7

Approximately how much of the world's output does China produce?

A)13 percent.
B)0 percent.
C)9 percent.
D)1.5 percent.

Question 8

The best measure of how much output the average person would get if all output were divided evenly among the population would be

A)GDP.
B)The economic growth of the economy.
C)Per capita GDP.
D)The capital stock of the economy.

Question 9

Average living standards are best measured using

A)GDP.
B)The economic growth of the economy.
C)Per capita GDP.
D)The capital stock of the economy.

Question 10

The United States has roughly how much of the world's arable land?

A)14 percent.
B)12 percent.
C)10 percent.
D)8 percent.

Question 11

Per capita GDP will definitely rise if

A)The population falls and GDP does not fall.
B)The rate of economic growth falls.
C)The rate of economic growth is less than the rate of population growth.
D)There is a decrease in the size of the labor force.

Question 12

The measure of final new goods and services produced in the United States is the

A)GDP of the United States.
B)Percentage change in the GDP of the United States.
C)Per capita GDP in the United States.
D)Total sales of all goods during the year.

Question 13

What percentage of the world's population subsists on incomes of less than $2 a day?

A)33 percent.
B)50 percent.
C)60 percent.
D)70 percent.

Question 14

Per capita GDP will definitely fall if

A)The population falls.
B)The rate of economic growth falls.
C)The rate of economic growth is less than the rate of population growth.
D)There is a decrease in the size of the labor force.

Question 15

Average GDP per person is

A)Also known as GDP.
B)Also known as per capita GDP.
C)The value of the factors of production used to produce output in a country.
D)A measure of the economic growth rate of a country.

Question 16

The United States has roughly how much of the world's population?

A)5 percent.
B)10 percent.
C)15 percent.
D)20 percent.

Question 17

The best definition of GDP is

A)The sum of the physical amounts of goods and services in the economy.
B)A dollar measure of final output produced during a given time period.
C)A measure of the per capita economic growth rate of the economy.
D)A physical measure of the capital stock of the economy.

Question 18

Which of the following statements is true about the U.S.economy?

A)The United States produces over one-fifth of the world's production.
B)The United States has the world's third largest economy.
C)The United States produces less than half as much as China does.
D)The United States produces less than one-third as much as Japan does.

Question 19

China has roughly how much of the world's population?

A)10 percent.
B)20 percent.
C)30 percent.
D)40 percent.

Question 20

If population growth is less than output growth for a country,

A)Real GDP has decreased.
B)Average living standards will decrease.
C)GDP must have fallen at a fairly rapid rate.
D)The per capita living standard will increase.

Question 21

The current U.S.economy is based primarily on the production of

A)Agricultural goods.
B)Goods for federal government use.
C)Manufacturing goods.
D)Services.

Question 22

To an economist,the four factors of production are

A)Labor,workers,profit,and services.
B)Land,labor,capital,and entrepreneurship.
C)Entrepreneurship,machinery,workers,and profit.
D)None of the choices are correct.

Question 23

If output growth exceeds population growth for a country,

A)Average living standards will increase.
B)GDP must have fallen at a very rapid rate.
C)Per capita GDP will decrease.
D)This country must have overcome the problem of scarcity.

Question 24

As the U.S.economy relies more and more heavily on the production of services rather than goods,

A)GDP will decrease since there will be less real production.
B)International trade will become more difficult.
C)Mass unemployment will result.
D)Nearly all future job growth will be in service-producing industries.

Question 25

On average,since 1900 U.S.output has grown roughly ____ times faster than population growth.

A)5
B)4
C)3
D)2

Question 26

On average,since 1900 the population of the United States has grown by roughly ____ percent per year.

A)9
B)6
C)3
D)1

Question 27

Which component(s)of U.S.real GDP decreased in size relative to total U.S.real GDP from 1950 to 2000?

A)Only agriculture.
B)Only manufacturing.
C)Agriculture and manufacturing.
D)Only services.

Question 28

Economic growth

A)Is an increase in output or real GDP.
B)Causes a contraction in the production possibilities curve.
C)Involves reduced capacity in the short run.
D)None of the choices are correct.

Question 29

Which of the following is considered a service in the calculation of GDP?

A)Reclining chairs.
B)Photographs.
C)Tax preparation.
D)Automobiles.

Question 30

On average,since 1900 U.S.output has grown by roughly ____ percent per year.

A)9
B)6
C)3
D)1

Question 31

Which of the following has been a century-long trend in the United States?

A)Decline of total value of world trade.
B)Relative increase in farming to manufacturing.
C)Relative decline in manufacturing to the service sector.
D)Relative decline in service sector to manufacturing.

Question 32

As of the year 2000,agriculture accounted for what percentage of total U.S.output?

A)1 percent.
B)5 percent.
C)8 percent.
D)None of the choices are correct.

Question 33

The WHAT question can best be answered using data about which of the following?

A)The distribution of output among manufacturing,services,and agricultural sectors.
B)Per capita GDP.
C)Productivity.
D)The distribution of GDP among different income quintiles.

Question 34

Which of the following countries experienced a decline in total output from 2000 to 2009?

A)Canada.
B)Zimbabwe.
C)China.
D)Burundi.

Question 35

High U.S.incomes have led to the transformation of the United States into primarily

A)A manufacturing economy.
B)A closed economy with little foreign trade.
C)An agricultural economy.
D)A service economy.

Question 36

As of the year 2000,manufacturing,mining,and construction accounted for what percentage of total U.S.output?

A)15 percent.
B)19 percent.
C)28 percent.
D)None of the choices are correct.

Question 37

As of the year 2000,services accounted for what percentage of total U.S.output?

A)25 percent.
B)50 percent.
C)80 percent.
D)90 percent.

Question 38

Which of the following contains the two sectors whose percentage contribution to the real GDP has declined since 1900?

A)Farming and manufacturing.
B)Manufacturing and exports.
C)Farming and services.
D)Services and exports.

Question 39

Which of the following countries had the highest average growth rate for per capita GDP from 2000 to 2009?

A)Canada.
B)Haiti.
C)China.
D)Burundi.

Question 40

Differences in size of real GDP across countries are best explained by

A)Population growth.
B)Human capital.
C)Large farming sector.
D)None of the choices are correct.

Question 41

How will a decrease in technology from a natural disaster such as a hurricane,ceteris paribus,affect an economy's production possibilities curve?

A)Shift the curve inward.
B)Result in a movement from inside the curve to a point on the curve.
C)Shift the curve outward.
D)Result in a movement along the curve.

Question 42

According to the World View chart in the text,from highest to lowest real GDP per capita,which is correct?

A)United States,Japan,France,Canada,China.
B)United States,China,Japan,Germany,Russia.
C)United States,Canada,Japan,France,South Korea.
D)United States,China,India,Jordan,Germany,Japan,Russia.

Question 43

How will an increase in factor mobility,ceteris paribus,affect an economy's production possibilities curve?

A)Shift the curve inward.
B)Result in a movement from inside the curve to a point on the curve.
C)Shift the curve outward.
D)Result in a movement along the curve.

Question 44

As a country's literacy rate and human capital capacity increase,the relative number of

A)Labor-intensive production processes increases.
B)Capital-intensive production processes increases.
C)Sector service jobs decreases.
D)None of the choices are correct.

Question 45

A labor-intensive production process is one that

A)Has a low ratio of labor to capital.
B)Has a low ratio of capital to labor.
C)Is used only in the United States.
D)All of the choices are correct.

Question 46

The United States has a larger real GDP than China because

A)The U.S.population is smaller but works in capital-intensive jobs.
B)The U.S.population is smaller but works in labor-intensive jobs.
C)The U.S.population is larger but works in capital-intensive jobs.
D)The U.S.population is larger but works in labor-intensive jobs.

Question 47

The term externalities refers to

A)Only positive benefits of a market activity borne by a third party.
B)Only negative costs of a market activity borne by a third party.
C)The negative costs and positive benefits of a market activity borne by a third party.
D)None of the choices are correct.

Question 48

An example of a positive externality is

A)Increased factory use of private sector robotics that came from government research.
B)Increased health problems from air pollution.
C)Increased business profits at a hardware store that benefited from a tornado.
D)None of the choices are correct.

Question 49

A capital-intensive production process is one that

A)Has a high ratio of labor to capital.
B)Has a high ratio of capital to labor.
C)Is used only in the United States.
D)All of the choices are correct.

Question 50

According to the World View chart in the text,from highest to lowest real GDP,which is correct?

A)United States,Japan,China,Germany,Britain.
B)United States,China,Japan,Germany,Russia.
C)United States,China,Japan,Germany,Britain.
D)United States,China,Germany,Japan,Canada.

Question 51

As of 2010,per capita GDP in the United States was approximately how many times the world average?

A)3.
B)5.
C)7.
D)

Question 52

When the government provides a legal framework,

A)Domestic market transactions suffer and foreign trade market transactions suffer.
B)Domestic market transactions benefit and foreign trade market transactions benefit.
C)Domestic transactions benefit and foreign market transactions suffer.
D)None of the choices are correct.

Question 53

Regarding increasing productivity,factor mobility is

A)Important in that it helps to fix a stable labor-intensive production process.
B)Important in that it helps to fix a stable capital-intensive production process.
C)Important in that it helps to reallocate resources in a dynamic economy.
D)Not important in either a stable or dynamic economy.

Question 54

A U.S.firm that outsources jobs would be

A)Building a factory in Canada and hiring Canadian workers.
B)Buying raw materials from a Chinese firm instead of a U.S.firm.
C)Buying computers assembled in Mexico that used U.S.parts.
D)All of the choices are correct.

Question 55

Which component(s)of U.S.real GDP increased in size relative to total U.S.real GDP from 1950 to 2000?

A)Only agriculture.
B)Only manufacturing.
C)Agriculture and manufacturing.
D)Only services.

Question 56

Although the necessary role of government in the economy is highly debated,many people agree that it should

A)Provide a legal framework.
B)Protect the environment.
C)Protect consumers and labor.
D)All of the choices are correct.

Question 57

When the government provides a legal framework,

A)Private market transactions suffer and government market transactions suffer.
B)Private market transactions suffer and government market transactions benefit.
C)Private market transactions benefit and government market transactions benefit.
D)None of the choices are correct.

Question 58

As of 2010,per capita GDP in the United States was approximately

A)$26,000.
B)$37,000.
C)$47,000.
D)None of the choices are correct.

Question 59

In providing a legal framework,the government

A)Protects patents to encourage entrepreneurship.
B)Protects copyrights to encourage textbook protection.
C)Protects the ownership of private property to encourage the private sector.
D)All of the choices are correct.

Question 60

Factor mobility aids in economic development when

A)A region suffers a natural disaster such as an earthquake or tornado.
B)A technological advance causes some firms to go out of business.
C)There is an increase in both outsourcing and insourcing.
D)All of the choices are correct.

Question 61

An example of human capital would be

A)A computer.
B)Carpentry skills.
C)A carpenter's saw.
D)All of the choices are correct.

Question 62

Which of the following contributes to the high productivity of American workers?

A)The labor-intensive production process in the United States.
B)The abundance of capital relative to labor.
C)The low level of factor mobility.
D)The decreasing investment in human capital.

Question 63

Human capital is defined as the

A)Amount of machinery,factories,and buildings an individual owns.
B)Dollar value of all the stocks and bonds an individual owns.
C)Knowledge and skills workers possess.
D)None of the choices are correct.

Question 64

Productivity is a measure of

A)Output per unit of input.
B)Output per dollar of input.
C)Input per unit of output.
D)Input per dollar of output.

Question 65

The government intervenes in the economy to protect labor by

A)Enforcing minimum age and working conditions for child labor.
B)Ensuring workplace safety conditions.
C)Ensuring minimum wages in addition to overtime provisions.
D)All of the choices are correct.

Question 66

Productivity

A)Rises when the value of output rises relative to the cost of inputs.
B)Falls when the value of output rises relative to the cost of inputs.
C)Rises when the ratio of output to input increases.
D)Falls when factors of production cost more.

Question 67

Which of the following definitely means productivity has increased?

A)More output from fewer workers.
B)Less output from fewer workers.
C)More output from more workers.
D)Less output from more workers.

Question 68

The investment in human capital through education and training can result in

A)Greater productivity.
B)Low factor mobility.
C)Less capital-intensive production.
D)Reduced output per labor hour.

Question 69

How will an increase in the level of human capital,ceteris paribus,affect an economy's production possibilities curve?

A)Shift the curve inward.
B)Result in a movement from inside the curve to a point on the curve.
C)Shift the curve outward.
D)Result in a movement along the curve.

Question 70

As a nation's average education level increases,the nation's level of productivity

A)Increases,and the production possibilities curve shifts to the right.
B)Decreases,and the nation's production possibilities curve shifts to the left.
C)Increases,and the nation moves to a new point on the same production possibilities curve.
D)Decreases,and the nation moves to a new point on the same production possibilities curve.

Question 71

When workers move from one industry to another in response to demand changes,this is an example of

A)Factor quality.
B)Factor mobility.
C)Capital stock.
D)The decreasing investment in human capital.

Question 72

The term factor of production refers to

A)Only those goods that are produced and then used to produce other goods and services.
B)Labor only.
C)Any resource used to produce goods and services.
D)Factories and machinery only.

Question 73

Which of the following is likely to be most capital-intensive?

A)Farming in developing countries.
B)Production of apparel by the Chinese.
C)Oil refining in the United States.
D)None of the choices are correct.

Question 74

In terms of an economy's production possibilities curve,a decrease in the level of human capital,ceteris paribus,will cause

A)An inward shift of the curve.
B)A movement from the curve to a point inside the curve.
C)A movement along the curve.
D)An expansion of the curve.

Question 75

Production processes that use a high ratio of capital to labor inputs are referred to as

A)Labor-intensive.
B)Production-intensive.
C)Capital-intensive.
D)Factor-intensive.

Question 76

Factor mobility refers to

A)Technological change in the use of capital.
B)The ease of reallocating resources.
C)Technological change in the use of labor.
D)The increase in labor productivity.

Question 77

According to economists,which of the following is NOT a factor of production?

A)Land.
B)Labor.
C)Money.
D)Entrepreneurship.

Question 78

When economists describe a production process as capital-intensive,they mean that the

A)Process uses a high ratio of machinery and other capital to labor.
B)Process needs a greater emphasis on labor in order to increase productivity.
C)Capital used in the process reflects the most advanced technology.
D)Capital used in the process tends to wear out (depreciate)very rapidly.

Question 79

Which of the following will increase the level of human capital in an economy?

A)An increase in land mass.
B)An increase in literacy rates.
C)An increase in factory capacity.
D)A decrease in the population.

Question 80

The government regulates monopolies in order to

A)Ensure that product quality meets minimum standards.
B)Prohibit mergers or acquisitions that would lessen competition.
C)Protect consumers from false advertising.
D)All of the choices are correct.