Question 1

One reason that Mexico has experienced relatively low rates of economic growth is that

Accepted Answer

Mexico has a long-standing problem with organized crime and corruption, which have hindered economic growth by discouraging foreign investment and creating an unstable business environment. Additionally, these issues have led to a lack of trust in the government and institutions, making it difficult to implement effective economic policies. While the other options may also impact economic growth to some extent, the issue of crime and corruption is seen as a significant barrier to progress in Mexico.

Question 2

The rapid growth of the Chinese economy should

Accepted Answer

The rapid growth of the Chinese economy means that they can produce consumer goods at a lower cost which may benefit U.S. consumers by providing them with less-expensive goods. The other options are not necessarily true and are based on assumptions rather than facts.

Question 3

According to Douglass North,the Industrial Revolution occurred in England because

Accepted Answer

Douglass North argued that the Industrial Revolution occurred in England because the British Parliament took control of the government and could credibly commit to upholding property rights. This created a stable and predictable environment for entrepreneurs to invest and innovate, leading to the emergence of new technologies and industries. In contrast, other countries that lacked strong institutions and property rights protection failed to experience sustained economic growth and industrialization.

Question 4

If real GDP per capita in the United States is $8,000 in 2018,and if real GDP per capita is $12,000 in 2028,what is the approximate average annual percent change in the growth rate of GDP per capita between 2018 and 2028?

Accepted Answer

We can use the following formula to calculate the average annual percent change:

[(Ending Value / Beginning Value)^(1/Number of Years) - 1] x 100

Plugging in the values given:

[(12,000 / 8,000)^(1/10) - 1] x 100

= 4.14%

Rounding to the nearest whole number, the average annual percent change is approximately 5%, which corresponds to choice B.

Question 5

Growth in real GDP per capita for the world economy was greatest during

Accepted Answer

The twentieth century experienced the greatest growth in real GDP per capita for the world economy, driven by advancements in technology, globalization, and the expansion of international trade. This period also saw massive economic growth in countries like China and India, which contributed significantly to the overall increase in global output.

Question 6

Over the past 50 years,deaths among children have

Accepted Answer

According to global trends, deaths among children have declined in nearly all countries, including most low-income countries, over the past 50 years. Although some countries have made greater progress than others, the overall trend is one of improvement.

Question 7

Suppose that in 2018,real GDP grew in Estonia by 3% and the population increased by 5%.Therefore,in 2018,Estonia experienced

Accepted Answer

Economic growth is measured by real GDP, which increased by 3%. However, an increase in population by 5% means that the per capita GDP (a measure of living standards) actually decreased. Therefore, there was economic growth but not an increase in living standards.

Question 8

According to the World Bank,in 2016,China's GDP was approximately $11.2 trillion (or $11,200 billion).That same year,India's GDP was approximately $2.3 trillion (or $2,300 billion).With which of the following populations would India's standard of living have been considered higher than China's that year?

Accepted Answer

India's GDP per capita would be higher than China's if India's GDP is divided by a smaller population compared to China's. In option B, China's population is unrealistically large, making its GDP per capita lower than India's.

Question 9

The best measure of a country's standard of living is

Accepted Answer

Real GDP per capita measures the average economic output per person in a country and is a commonly used metric to compare living standards across countries. It takes into account the size of a country's population and provides a more accurate picture of the country's economic well-being than just looking at total nominal GDP.

Question 10

If real GDP per capita in Ireland is estimated to be $7,400 in 2018,what will real GDP per capita be in 2023 if real GDP per capita grows at an annual rate of 2.8%?

Accepted Answer

We can use the formula:

Future value = Present value x (1 + growth rate)^n

where:
Present value = $7,400
Growth rate = 2.8% per year
n = number of years = 5 (from 2018 to 2023)

Plugging in the values, we get:

Future value = $7,400 x (1 + 0.028)^5
Future value = $7,400 x 1.151
Future value = $8,496

Therefore, the answer is B) $8,496.

Question 11

Increasing the growth rate of GDP per capita and sustaining this growth rate in an economy can

Accepted Answer

Increasing the growth rate of GDP per capita and sustaining this growth rate in an economy can lead to an increase in standards of living, as it implies an increase in the availability of goods and services for people to consume. It is not directly related to infant mortality, poverty, or life expectancy.

Question 12

Which of the following accurately describes the economic growth and standards of living between 1,000,000 B.C.and 1300 A.D.?

Accepted Answer

The time span between 1,000,000 B.C. and 1300 A.D. is vast and covers the majority of human history. While there were instances where certain societies experienced temporary economic growth, there was no sustained economic growth during this entire period. Additionally, evidence suggests that standards of living varied greatly depending on the region and time period, but overall did not show a significant improvement from 1,000,000 B.C. to 1300 A.D. Therefore, option D is the most accurate description.

Question 13

If real GDP per capita in the United States is $8,000 in 2018,and if real GDP per capita is $12,000 in 2028,what is the total percent change in the growth rate of GDP per capita between 2018 and 2028?

Accepted Answer

The total percent change in the growth rate of GDP per capita from $8,000 to $12,000 is calculated as (($12,000 - $8,000) / $8,000) * 100 = 50%.

Question 14

If real GDP per capita in the United States is $8,000,what will real GDP per capita in the United States be after 5 years if real GDP per capita grows at an annual rate of 3.2%?

Accepted Answer

Using the formula for calculating the future value of a present amount, we have:

FV = PV x (1 + r)^n

where FV is the future value, PV is the present value, r is the annual growth rate, and n is the number of years.

Plugging in the values given in the question, we get:

FV = $8,000 x (1 + 0.032)^5
FV = $8,000 x 1.176
FV = $9,408

However, we need to find the future value per capita, so we need to divide this amount by the population. Assuming a population of 328 million for the US, we get:

FV per capita = $9,408 / 328,000,000
FV per capita ≈ $28.63

Therefore, the answer that is closest is C, $9,365.

Question 15

Table 11-1
 
-Refer to Table 11-1.Based on the table above,which country has a higher standard of living and why?

Accepted Answer

The standard of living is more accurately reflected by GDP per capita rather than total GDP, as it accounts for the population size and indicates the average wealth of each person in the country. If Ireland has a higher GDP per capita, it suggests a higher standard of living compared to Sweden, regardless of the total GDP or GDP growth rates.

Question 16

The Industrial Revolution began in

Accepted Answer

The Industrial Revolution began in England around 1750, marked by the development of new technologies and improvements in manufacturing processes. This period had a significant impact on global economic and social development, transforming many societies from agrarian-based to industrial-based economies.

Question 17

Significant economic growth did not begin in the world until

Accepted Answer

Significant economic growth on a global scale is widely recognized to have begun around 1750 A.D., coinciding with the onset of the Industrial Revolution. This period marked a dramatic increase in the rate of economic growth due to technological innovations, increased productivity, and the expansion of global trade networks.

Question 18

If real GDP in the United States is growing at an annual rate of 3.2% per capita and Bolivia's real GDP per capita is growing at a rate of 1.3%,which of the following would we expect in the long run? Assume real GDP per capita in the United States begins at a level above that of real GDP per capita in Bolivia.

Accepted Answer

Since the United States' real GDP per capita is growing at a faster rate (3.2%) compared to Bolivia's (1.3%), the absolute difference in real GDP per capita between the two countries will increase over time, assuming all other factors remain constant.

Question 19

If a country's real GDP is rising by 2% per year while its population is rising at 7% per year,which of the following is true?

Accepted Answer

Real GDP measures the value of all final goods and services produced within a country's borders, adjusted for inflation. In this scenario, real GDP is only rising by 2%, which is lower than the population growth rate of 7%. This means that the country's overall production of goods and services is not keeping up with the pace of population growth. As a result, the country's per capita output, or standard of living, is falling.

Question 20

The period of time from 1,000,000 B.C.to 1300 A.D.was a period of

Accepted Answer

The period from 1,000,000 B.C. to 1300 A.D. spanned a vast amount of time and saw many different civilizations rise and fall. However, overall, there was no sustained economic growth during this time period. There may have been periods of growth in certain regions or under certain rulers, but these were not sustained over the long term. Additionally, many civilizations during this time relied heavily on agriculture and were limited by technological and logistical constraints, further hindering widespread economic growth.

Quiz 11: Long-Run Economic Growth: Sources and Policies