Question 1

The growth accounting equation suggests that the growth rate of output is equal to the growth rate of ________.
A) total factor productivity plus the contributions of both capital and labor
B) total factor productivity minus the rate of depreciation
C) capital and labor
D) the overall population

Accepted Answer

According to the growth accounting equation, the growth rate of output is equal to the growth rate of total factor productivity plus the contributions of both capital and labor. This equation can be written as: Y = A*K^α*L^(1-α), where Y is output, A is total factor productivity, K is capital, L is labor, and α is the share of income going to capital. Therefore, the growth rate of output is equal to the growth rate of A, K, and L.

Question 2

Figure 6.1 
-According to Figure 6.1, fluctuations in the rate of output growth are due mostly to changes in the growth of ________.
A) productivity
B) labor input
C) output
D) capital input

Accepted Answer

The figure shows that fluctuations in the rate of output growth are closely related to changes in the growth of productivity. Labor input and capital input growth rates do not appear to have as significant an impact on output growth fluctuations.

Question 3

National output is a function of ________.
A) capital and saving
B) technology, employment and demand
C) labor and depreciation
D) labor, technology and capital

Accepted Answer

National output is determined by the factors of production which include labor, technology and capital. These factors work together to create goods and services that meet the demands of the economy. Labor refers to the workforce, technology refers to the machinery and tools used in production, and capital refers to the financial resources used to produce the goods and services. Therefore, the correct answer is option D.

Question 4

The economic growth of the United States over the last century ________.
A) is best understood as the result of high levels of saving and investment
B) is quite unlike the experience of most other economies.
C) was driven by rising import purchases.
D) was the result of reducing government intervention in the economy.

Accepted Answer

The answer of The economic growth of the United States...

Question 5

Productivity growth can be measured ________.
A) by dividing output by Kt0.3 Lt0.7
B) by adding the contributions from capital growth and labor growth
C) by subtracting the contributions from capital growth and labor growth from the growth of output
D) by dividing the growth of output by the contributions from capital growth and labor growth

Accepted Answer

The answer of Productivity growth can be measured ________.
A) by...

Question 6

Figure 6.1 
-According to Figure 6.1, the average annual rate of growth of the U.S. economy in the period 1948-73 equalled ________.
A) 1.8 percent.
B) 4.0 percent.
C) 39 percent.
D) 697 percent.

Accepted Answer

From the figure, it can be seen that the average annual rate of growth of the U.S. economy in the period 1948-73 was approximately 4%.

Question 7

Figure 6.1 
-According to Figure 6.1, the average annual rate of growth of the U.S. economy in the period 1996-2008 equalled ________.
A) 0.3 percent.
B) 3.0 percent.
C) 30 percent.
D) 300 percent.

Accepted Answer

The line indicating the average annual rate of growth of the U.S. economy in the period 1996-2008 is labelled as 3.0 percent.

Question 8

The highest rate of U.S. growth was recorded in which of the following periods?
A) 1948-73.
B) 1967-83.
C) 1974-95.
D) 1996-2008.

Accepted Answer

The highest rate of U.S. growth was recorded in the period from 1948 to 1973, a time often referred to as the "Golden Age" of economic expansion in the post-World War II era. This period was characterized by rapid industrial growth, significant increases in productivity and living standards, and relatively low unemployment rates.

Question 9

Capital and labor are distinct from productivity in that ________.
A) productivity is independent of technology changes
B) productivity can only increase over time
C) productivity is subject to diminishing returns
D) capital and labor are subject to diminishing marginal returns

Accepted Answer

Capital and labor are subject to diminishing marginal returns, meaning that as more units of capital or labor are added, productivity eventually decreases. Productivity itself can increase or decrease based on a variety of factors including changes in technology, organizational practices, and worker skills. It is not independent of technology changes nor subject to only increasing over time, and it may also be subject to diminishing returns.

Question 10

If productivity growth equals 3.0 percent, the contribution from capital growth 1.2 percent and the contribution from labor growth 2.0 percent, then output growth must equal ________.
A) 2.2 percent.
B) 4.2 percent.
C) 6.2 percent.
D) 7.2 percent.

Accepted Answer

Output growth is the sum of productivity growth, capital growth, and labor growth. Therefore, output growth equals 3.0 + 1.2 + 2.0 = 6.2 percent. Therefore, the correct option is C.

Question 11

Which of the following is the most difficult to measure? Changes in ________.
A) the size of the labor force
B) population
C) the quantity of labor
D) productivity

Accepted Answer

Productivity is the most difficult to measure as it involves complex calculations and requires accurate data on input and output. Changes in the size of the labor force, population, and the quantity of labor can be measured using relatively simple methods such as census data and surveys.

Question 12

Figure 6.1 
-According to Figure 6.1, the period from 1974 to 1995 is particularly remarkable for the slow growth of ________.
A) output per worker
B) labor input
C) output
D) capital input

Accepted Answer

Figure 6.1 shows that the output per worker growth rate was the slowest from 1974 to 1995, which is a period of slow growth for this measure of productivity.

Question 13

Across national economies which of the following is the most important source of variation in growth rates?
A) labor growth.
B) capital growth.
C) productivity growth.
D) government regulation.

Accepted Answer

Productivity growth is the most important source of variation in growth rates across national economies. It refers to the increased efficiency in producing goods and services, which can lead to higher economic output and GDP growth. Labor and capital growth also contribute to economic growth, but productivity growth has a greater impact on overall growth rates. Government regulation can have an impact on growth rates, but it is not as important as productivity growth.

Question 14

The slowdown in U.S. economic growth in the period 1974-95 was primarily caused by ________.
A) falling labor growth.
B) falling capital growth.
C) falling productivity growth.
D) none of the above

Accepted Answer

Falling productivity growth was the primary cause of the economic slowdown in the U.S. during the period of 1974-95. During this time, productivity growth fell from an average of 3% per year in the 1960s to an average of 1.5% per year. This led to a decrease in economic output and slower economic growth. While labor and capital growth also played a role, they were not the primary drivers of the slowdown.

Question 15

Productivity is ________.
A) determined by central bank policy
B) the combined effect of monetary and fiscal policy
C) the residual component of the production function
D) driven by changes in the rate of growth of output

Accepted Answer

Productivity is determined by the residual component of the production function, which is the portion of output that cannot be attributed to inputs of labor and capital. It is influenced by factors such as technology, education, and innovation, and is not directly affected by monetary or fiscal policy. Changes in the rate of growth of output can impact productivity, but productivity is not solely driven by changes in output growth.

Question 16

Figure 6.1 
-In Figure 6.1, the post-World War II "baby boom" is reflected in the growth of ________.
A) labor input from 1974 - 1995
B) labor input from 1948 - 1973
C) output from 1948 - 1973
D) capital input from 1996 - 2008

Accepted Answer

The answer of Figure 6.1 
-In Figure 6.1, the post-World...

Question 17

If the contribution from capital and labor growth in a given economy equals 4.0 percent and output growth equals 6.4 percent over that same period of time, then productivity growth must equal ________.
A) 25.6 percent.
B) 10.4 percent.
C) 2.4 percent.
D) 1.6 percent.

Accepted Answer

Productivity growth can be calculated as the difference between output growth and the sum of capital and labor growth. Therefore, productivity growth in this economy would be:
Productivity growth = Output growth - (Capital growth + Labor growth)
Productivity growth = 6.4% - 4.0%
Productivity growth = 2.4%

Question 18

Economic growth ________.
A) is driven by different elements in different economies.
B) is driven primarily by digital technology.
C) is driven primarily by labor growth.
D) cannot be explained using economic models.

Accepted Answer

Economic growth is driven by different elements in different economies, such as natural resources, technology, human capital, infrastructure, and institutions. While digital technology may play a significant role in some economies, it is not the only driver of economic growth.

Question 19

Figure 6.1 
-According to Figure 6.1, in postwar U.S history ________.
A) productivity growth was always exceeded by labor growth.
B) labor growth has always exceeded capital growth.
C) productivity growth has always exceeded capital growth.
D) output growth has always exceeded productivity growth.

Accepted Answer

Output growth exceeding productivity growth implies that the increase in total production is greater than the improvements in the efficiency of production. This can occur when there is an increase in inputs (like labor and capital) alongside productivity improvements, leading to overall higher output growth.

Question 20

Figure 6.1 
-According to Figure 6.1, the period from 1996 to 2008 is particularly remarkable for the rapid growth of ________.
A) productivity
B) labor input
C) output
D) capital input

Accepted Answer

The period from 1996 to 2008 is noted for rapid growth in productivity, which often refers to the efficiency of production and is a key factor in economic growth.

Quiz 6: The Sources of Growth and the Solow Model

The growth accounting equation suggests that the growth rate of output is equal to the growth rate of ________.

Figure 6.1 -According to Figure 6.1, fluctuations in the rate of output growth are due mostly to changes in the growth of ________.

National output is a function of ________.

The economic growth of the United States over the last century ________.

Productivity growth can be measured ________.

Figure 6.1 -According to Figure 6.1, the average annual rate of growth of the U.S. economy in the period 1948-73 equalled ________.

Figure 6.1 -According to Figure 6.1, the average annual rate of growth of the U.S. economy in the period 1996-2008 equalled ________.

The highest rate of U.S. growth was recorded in which of the following periods?

Capital and labor are distinct from productivity in that ________.

If productivity growth equals 3.0 percent, the contribution from capital growth 1.2 percent and the contribution from labor growth 2.0 percent, then output growth must equal ________.

Which of the following is the most difficult to measure? Changes in ________.

Figure 6.1 -According to Figure 6.1, the period from 1974 to 1995 is particularly remarkable for the slow growth of ________.

Across national economies which of the following is the most important source of variation in growth rates?

The slowdown in U.S. economic growth in the period 1974-95 was primarily caused by ________.

Productivity is ________.

Figure 6.1 -In Figure 6.1, the post-World War II "baby boom" is reflected in the growth of ________.

If the contribution from capital and labor growth in a given economy equals 4.0 percent and output growth equals 6.4 percent over that same period of time, then productivity growth must equal ________.

Economic growth ________.

Figure 6.1 -According to Figure 6.1, in postwar U.S history ________.

Figure 6.1 -According to Figure 6.1, the period from 1996 to 2008 is particularly remarkable for the rapid growth of ________.