Question 1

The one- third rule states that, holding technology constant, for every 1 percent increase in

Accepted Answer

The one-third rule states that, holding technology constant, for every 1 percent increase in capital per hour of labor, real GDP per hour of labor will increase by 0.33 percent. Therefore, option B is the correct choice.

Question 2

If capital per hour of labor grows by 3 percent a year and labor productivity grows by 2.5 percent a year, the one third rule says that the growth in labor productivity can be divided so that capital growth accounted for percentage points and technological change accounted for percentage points.

Accepted Answer

According to the one third rule, one third of the growth in capital per hour of labor (3% * 1/3 = 1%) contributes to labor productivity growth, so technological change accounts for the remaining 1.5% (2.5% - 1%).

Question 3

Suppose capital per hour of labor grows at 3.0 percent per year and the growth rate of real GDP per hour of labor is 2.0 percent per year. Thus technological change leads to _ percent per year change in real GDP per hour of labor.

Accepted Answer

Technological change leads to the difference between the growth rate of real GDP per hour of labor and the growth rate of capital per hour of labor. Therefore, the answer is 2.0% - 3.0% = -1.0%, which is a decrease of 1.0% per year.

Question 4

Suppose capital per hour of labor grows at 3.0 percent per year and technological change grows at
1)0 percent per year. The growth rate of real GDP per hour of labor is percent per year.

Accepted Answer

The answer of Suppose capital per hour of labor grows...

Question 5

Growth accounting explains changes in labor productivity by

Accepted Answer

Growth accounting takes into account both changes in capital per hour of labor and technological change when explaining changes in labor productivity over time.

Question 6

Growth accounting breaks the growth rate of real GDP into which of the following components?

Accepted Answer

Growth accounting breaks down the growth rate of real GDP into three components: the growth of labor inputs (usually measured as employment or hours worked), the growth of capital inputs (measured as the stock of physical and human capital), and the growth of technological advances (measured as total factor productivity or efficiency in combining inputs). Therefore, all of the above (labor inputs, capital inputs, and technological advances) are included in growth accounting.

Question 7

According to MIT economist Robert Solow, in the absence of a change in technology, a 1 percent increase in capital per hour of labor

Accepted Answer

This is known as the "Solow productivity paradox" and is based on the production function Y = F(K,AL), where Y is real GDP, K is physical capital, L is labor, and A is the level of technology. In the absence of technology change (i.e. A is constant), an increase in K leads to a smaller and smaller increase in Y due to diminishing returns to capital. Solow estimated that in the long run, a 1 percent increase in K per hour of labor leads to a 1/3 (0.33 percent) percent increase in real GDP per hour of labor, holding A constant.

Question 8

provides a way for economists to calculate the impact of different determinants of economic growth.

Accepted Answer

Growth accounting is a way for economists to calculate the impact of different determinants of economic growth, such as changes in labor productivity, human capital, and technology. It helps to identify which factors are driving economic growth and can inform policy decisions aimed at promoting growth. Labor productivity (B) and nominal GDP (C) are important factors in growth accounting, but they are not the method itself. Growth theory (D) is a broader field of study that examines the underlying mechanisms of economic growth.

Question 9

In Lotusland, real GDP per hour of labor grows at 6 percent a year and capital per hour of labor increases by 6 percent a year. The one- third rule tells us that capital per hour of labor increased real GDP per hour of labor by .

Accepted Answer

The one-third rule suggests that if capital per hour of labor increases by 6 percent, it contributes one-third of that increase to the growth in real GDP per hour of labor, which is 2 percent.

Question 10

If capital per hour of labor increases 6 percent and real GDP per hour of labor increases by 4 percent, then according to the one- third rule technological change

Accepted Answer

According to the one-third rule, if capital per hour of labor increases by 6 percent, then 2 percent (one-third of 6 percent) of the increase in real GDP per hour of labor is due to capital deepening, implying that the remaining 2 percent of the 4 percent growth is due to technological change.

Question 11

Suppose capital per hour of labor grows at 3.0 percent per year and technological change grows at
1)0 percent per year. Using the one- third rule, the growth rate of real GDP per hour of labor is
Percent per year.

Accepted Answer

The answer of Suppose capital per hour of labor grows...

Question 12

Growth accounting divides the growth of labor productivity into two components, which are

Accepted Answer

Growth accounting divides the growth of labor productivity into two components: growth in capital per hour of labor and technological change. These two components together determine the rate of growth of labor productivity. Factors such as the labor/capital ratio and the price of labor relative to capital may have an impact on these components, but they are not themselves the components that growth accounting aims to identify. Choice A is therefore incorrect. While real GDP per person and the amount of capital per worker may be useful measures of economic growth and development, they are not the two components of growth accounting, so choice C is incorrect. Finally, real GDP per hour of labor and real GDP per dollar of capital may be useful measures of productivity and efficiency, but they do not map directly onto the two components identified by growth accounting, so choice D is also incorrect.

Question 13

If capital per hour of labor grows by 3 percent a year and labor productivity grows by 1.5 percent a year, the one third rule says that the growth in labor productivity can be divided so that capital growth accounted for percentage points and technological change accounted for percentage points.

Accepted Answer

According to the one third rule, labor productivity growth can be divided into three parts: capital growth, technological change, and residual (unexplained) growth.

If capital per hour of labor grows by 3 percent a year and labor productivity grows by 1.5 percent a year, then the residual growth would be 1.5 percent (since 3% - 1.5% = 1.5%).

Using the one third rule, we can divide the 1.5% labor productivity growth between capital growth and technological change. Since capital growth is assumed to be one third of the total growth in labor productivity, it would account for 0.5 percentage points (or one third of 1.5%).

The remaining 1.0 percentage points (or two thirds of 1.5%) would be accounted for by technological change. Therefore, the correct answer is A) 1.0; 0.5.

Question 14

The one- third rule states that a one percent increase in per hour of labor with in technology results in a one- third of one percent increase in per hour of labor.

Accepted Answer

The answer of The one- third rule states that a...

Question 15

The one- third rule

Accepted Answer

The one-third rule is used in economics to show how capital contributes to an increase in output, specifically indicating that approximately one-third of output growth can be attributed to capital accumulation.

Question 16

The one- third rule

Accepted Answer

The one-third rule states that a 1 percent increase in capital per hour of labor leads to a 1/3 percent increase in real GDP per hour of labor. This means that an increase in the quantity of capital used in combination with labor will increase the output of goods and services.

Question 17

Which of the following describes the one- third rule?

Accepted Answer

The one-third rule states that if capital per hour of labor increases by 3 percent, real GDP per hour of labor will increase by 1 percent. Therefore, option B is the correct description of the one-third rule. Option A and D are incorrect as they do not describe the relationship between capital and real GDP per hour of labor correctly. Option C is incorrect as it reverses the relationship between the increase in capital and real GDP per hour of labor.

Question 18

Suppose capital per hour of labor grows at 1.0 percent per year and technological change grows at
2)0 percent per year. Using the one- third rule, the growth rate of real GDP per hour of labor is
Percent per year.

Accepted Answer

The answer of Suppose capital per hour of labor grows...

Question 19

Using growth accounting, a factor leading to "technological change" includes

Accepted Answer

Technological change is driven by advances in human capital, such as greater knowledge, skills, and education among workers, that lead to increased productivity and innovation. Diminishing returns and increases in capital per hour of labor are factors that contribute to economic growth but do not lead directly to technological change.

Question 20

Using growth accounting, technological change is calculated as the

Accepted Answer

Technological change is calculated as the growth in labor productivity not explained by the growth capital per hour of labor. This is because technological change refers to changes in the effectiveness and efficiency of the production process, which can result in increases in labor productivity. Growth accounting separates the contribution of different factors to economic growth, and isolates the portion of growth that cannot be explained by changes in capital and labor inputs, which is attributed to technological progress.

Quiz 6: Economic Growth

The one- third rule states that, holding technology constant, for every 1 percent increase in

If capital per hour of labor grows by 3 percent a year and labor productivity grows by 2.5 percent a year, the one third rule says that the growth in labor productivity can be divided so that capital growth accounted for percentage points and technological change accounted for percentage points.

Suppose capital per hour of labor grows at 3.0 percent per year and the growth rate of real GDP per hour of labor is 2.0 percent per year. Thus technological change leads to _ percent per year change in real GDP per hour of labor.

Suppose capital per hour of labor grows at 3.0 percent per year and technological change grows at 1) 0 percent per year. The growth rate of real GDP per hour of labor is percent per year.

Growth accounting explains changes in labor productivity by

Growth accounting breaks the growth rate of real GDP into which of the following components?

According to MIT economist Robert Solow, in the absence of a change in technology, a 1 percent increase in capital per hour of labor

provides a way for economists to calculate the impact of different determinants of economic growth.

In Lotusland, real GDP per hour of labor grows at 6 percent a year and capital per hour of labor increases by 6 percent a year. The one- third rule tells us that capital per hour of labor increased real GDP per hour of labor by .

If capital per hour of labor increases 6 percent and real GDP per hour of labor increases by 4 percent, then according to the one- third rule technological change

Suppose capital per hour of labor grows at 3.0 percent per year and technological change grows at 1) 0 percent per year. Using the one- third rule, the growth rate of real GDP per hour of labor is Percent per year.

Growth accounting divides the growth of labor productivity into two components, which are

If capital per hour of labor grows by 3 percent a year and labor productivity grows by 1.5 percent a year, the one third rule says that the growth in labor productivity can be divided so that capital growth accounted for percentage points and technological change accounted for percentage points.

The one- third rule states that a one percent increase in per hour of labor with in technology results in a one- third of one percent increase in per hour of labor.

The one- third rule

The one- third rule

Which of the following describes the one- third rule?

Suppose capital per hour of labor grows at 1.0 percent per year and technological change grows at 2) 0 percent per year. Using the one- third rule, the growth rate of real GDP per hour of labor is Percent per year.

Using growth accounting, a factor leading to "technological change" includes

Using growth accounting, technological change is calculated as the