Question 1

The determinants of economic growth include all of the following except

Accepted Answer

Growth in money supply may result in inflation, but it does not directly contribute to long-term economic growth. The other options - technological improvement, growth in physical capital, and growth in human capital - are all factors that can contribute to sustained economic growth.

Question 2

All other things unchanged, which of the following events leads to a shift further outward in the country's production possibility curve?

Accepted Answer

Increasing government expenditure on basic research can lead to the development of new technologies and innovations, which can increase productivity and shift the production possibility curve outward. The other options either involve a decrease in resources (labor force, saving rate, college-educated individuals) or do not directly contribute to increased productivity.

Question 3

In the long run, economic growth will lead to
I.the opportunity to produce more consumer goods.
II.the opportunity to produce more capital goods.
III.a higher material standard of living.
IV.a more equitable distribution of income.

Accepted Answer

The answer of In the long run, economic growth will...

Question 4

What is the opportunity cost of allocating more and more resources to the production of capital goods?

Accepted Answer

Allocating more resources to the production of capital goods means allocating fewer resources to the production of consumption goods. Therefore, the opportunity cost is the amount of consumption goods that could have been produced. The other options (A, C, and D) are not directly related to the production of capital goods.

Question 5

Which of the following is an example of an investment in human capital?

Accepted Answer

Enrolling in a course to improve your computer skills is an example of investing in human capital because you are acquiring knowledge and skills that can increase your productivity and contribute to your overall earning potential in the long term. Purchasing a computer or installing new software may also enhance productivity, but they do not necessarily involve the development of human capital. Accepting a job in the computer industry may or may not involve investing in human capital, depending on whether the job requires you to acquire new skills or knowledge.

Question 6

The determinants of economic growth include all of the following except

Accepted Answer

A stable price level is not considered a determinant of economic growth. Technological improvement, improvements in the quality of factors of production, and increases in the quantity of factors of production are all factors that contribute to economic growth, but a stable price level is not.

Question 7

Which of the following factors contribute to economic growth?

Accepted Answer

Economic growth is typically measured by the increase in a country's real GDP over time. Factors that contribute to this growth include an increase in physical capital (such as factories, machines, and infrastructure), an increase in the availability of natural resources (such as oil or timber), and an increase in the productivity of labor (due to advancements in technology or education, for example). Therefore, all of the choices – A, B, and C – contribute to economic growth.

Question 8

During the industrial revolution, technological changes, capital investment, and the number of workers employed all increased.What must be true about capital and labor?

Accepted Answer

The fact that both capital investment and the number of workers employed increased during the industrial revolution implies that they are complementary inputs in production. This means that they are both needed to produce goods and services efficiently.

Question 9

For a given level of technology, a higher rate of economic growth can probably be achieved only if a country's citizens are prepared to

Accepted Answer

To achieve a higher rate of economic growth, citizens need to sacrifice some present consumption, meaning they need to save instead of spending all their income. This will allow for more investment in the economy, leading to higher productivity and growth in the long run. The other options may have short-term effects but are not sustainable for achieving long-term economic growth.

Question 10

Which of the following events would be most likely to increase an economy's potential output?

Accepted Answer

An improvement in technology can increase an economy's potential output by improving productivity and making it possible to produce more goods and services with the same amount of resources. A tax increase or an increase in transfer payments by the government can decrease an economy's potential output by reducing incentives to work, save, and invest. An increase in net exports may increase an economy's actual output, but it does not necessarily increase its potential output.

Question 11

All of the following are sources of economic growth except

Accepted Answer

An increase in consumption spending may temporarily stimulate production and activity, but it does not promote long-term economic growth. Economic growth is sustained by increases in physical and human capital, as well as improvements in technology and innovation. An increase in the savings rate can also contribute to economic growth by providing funds for investment in physical capital.

Question 12

An increase in saving

Accepted Answer

When people save more, there is more money available for investment in capital goods, which are used to produce more goods and services in the future. This can lead to an increase in economic growth and a higher standard of living in the long run.

Question 13

In the long run, economic growth can be expected to lead to
I.increases in consumption.
II.increases in the capital stock.
III.increases in the savings rate.
IV.outward shifts in the production possibilities curve.

Accepted Answer

Economic growth leads to increases in consumption and the capital stock, as well as outward shifts in the production possibilities curve due to increased efficiency and technological advancements. Economic growth may also lead to increases in the savings rate as individuals and businesses have more income to save and invest. Therefore, choices I, II, and IV are all correct, but choice III is not necessarily true in every case.

Question 14

During the industrial revolution, the United States saw increases in the demand for labor and increases in the supply of labor.The increase in real wages rose during this period is consistent with which of the following statements?

Accepted Answer

The increase in real wages during the industrial revolution suggests that the rightward shift in the labor demand curve was greater than the rightward shift of the labor supply curve. This is because as demand for labor increased, employers were willing to pay higher wages to attract workers, and the increase in real wages reflects this increase in demand. If the rightward shift in the labor supply curve was greater than the rightward shift of the labor demand curve, we would expect to see a decrease in real wages as the increase in supply would allow employers to pay lower wages. Therefore, option A is the best choice.

Question 15

Which of the following is a cost of economic growth?

Accepted Answer

Economic growth often requires investment in capital goods, which can lead to a sacrifice of current consumption as resources are diverted from producing consumer goods to producing capital goods.

Question 16

For economic growth to occur, the citizens of an economy must

Accepted Answer

Economic growth requires investment in capital goods such as factories, machinery, and technology. Investing in these goods requires sacrificing current consumption in order to produce more goods and services in the future. This increased production leads to higher economic growth and higher levels of consumption in the future. Therefore, citizens must sacrifice current consumption for future consumption to achieve economic growth.

Question 17

The skills, training, and education possessed by workers contribute to economic growth

Accepted Answer

Workers who possess higher level skills, training, and education are able to perform their jobs at a higher level of quality, increasing productivity and efficiency. This, in turn, contributes to economic growth.

Question 18

Economic growth can generally be achieved through a(n)

Accepted Answer

Economic growth can be achieved through an increase in investment, which can lead to a higher level of productivity and output. This can be facilitated by an increase in the proportion of GDP used for saving.

Question 19

Economic growth can be modeled as
I.an outward shift of the economy's production possibilities curve.
II.a rightward shift of the economy's long-run aggregate supply curve.
III.a rightward shift of the labor demand and the labor supply curves.
IV.an upward shift of the economy's aggregate production function.

Accepted Answer

Economic growth is typically represented by an outward shift of the production possibilities curve and a rightward shift of the long-run aggregate supply curve, indicating an increase in the economy's capacity to produce goods and services.

Question 20

A factor critical to economic growth is

Accepted Answer

Technological change that increases labor productivity is critical to economic growth because it leads to increased efficiency, cost savings, and higher output levels. This, in turn, leads to increased competitiveness of domestic firms, higher levels of exports, and improved standards of living. Increased saving rates, increases in human consumption, and reduced dependence on imports can contribute to economic growth but are not as critical as improvements in productivity.

Quiz 23: Economic Growth

The determinants of economic growth include all of the following except

All other things unchanged, which of the following events leads to a shift further outward in the country's production possibility curve?

In the long run, economic growth will lead to I.the opportunity to produce more consumer goods. II.the opportunity to produce more capital goods. III.a higher material standard of living. IV.a more equitable distribution of income.

What is the opportunity cost of allocating more and more resources to the production of capital goods?

Which of the following is an example of an investment in human capital?

The determinants of economic growth include all of the following except

Which of the following factors contribute to economic growth?

During the industrial revolution, technological changes, capital investment, and the number of workers employed all increased.What must be true about capital and labor?

For a given level of technology, a higher rate of economic growth can probably be achieved only if a country's citizens are prepared to

Which of the following events would be most likely to increase an economy's potential output?

All of the following are sources of economic growth except

An increase in saving

In the long run, economic growth can be expected to lead to I.increases in consumption. II.increases in the capital stock. III.increases in the savings rate. IV.outward shifts in the production possibilities curve.

During the industrial revolution, the United States saw increases in the demand for labor and increases in the supply of labor.The increase in real wages rose during this period is consistent with which of the following statements?

Which of the following is a cost of economic growth?

For economic growth to occur, the citizens of an economy must

The skills, training, and education possessed by workers contribute to economic growth

Economic growth can generally be achieved through a(n)

A factor critical to economic growth is