Between 1898 and 1998, real GDP per person in the United States has grown at an average rate of 2 percent a year. During this 100-year period, _______ has grown at a faster rate than _______.

inflation; real GDP
GDP; the population
real GDP; the population
the population; real GDP

An increase in the capital stock with no change in population creates a _______ the productivity function, and an increase in human capital creates a _______ the productivity function.

shift of; movement along
shift of; shift of
movement along; movement along
movement along; shift of

When capital per hour of work increases by $20,000, real GDP per hour of work increases by $14,000. According to the law of diminishing returns, if capital per hour of work increases by an additional $20,000, real GDP per hour of work _________________.

will increase by $14,000
will increase by less than $14,000
will remain unchanged
will decrease by less than $14,000

In Lotus land, real GDP per hour of work grows at 9 percent a year when capital per hour of work increases by 3 percent a year. The one-third rule tells us that capital per hour of work increased real GDP per hour by __________.

1 percent a year
1/3 percent a year
3 percent a year
6 percent a year

In Lotus land, real GDP per hour of work grows at 9 percent a year when capital per hour of work increases by 3 percent a year. The one-third rule tells us that advances in technology increased real GDP per hour by __________.

6 percent a year
3 percent a year
8 percent a year
2 percent a year

In Dreamland, capital per hour of work increased by 6 percent a year and advances in technology increased real GDP per hour of work by 1 percent a year. Real GDP per hour of work increased by _________________.

5 percent a year
4 percent a year
6 percent a year
3 percent a year

In SleepyTime, as capital per hour of work grows by 3 percent a year and technology does not change, _______________ and real GDP per hour of work increases by _____ percent a year.

SleepTime moves along its productivity function; 3
SleepTime moves along its productivity function; 1
SleepTime's productivity function shifts upward; 1
SleepTime's productivity function shifts upward; 3

In Lotus land, real GDP per hour of work grows at 15 percent a year when technology increases real GDP per hour of work by 5 percent a year. Lotus Land ______________ as capital per hour of work grows by _____ percent a year.

productivity function shifts upward; 30
productivity function shifts upward; 10
moves along its productivity function; 10
moves along its productivity function; 30

The economy is at point a in the figure, and the wage rate is the subsistence real wage rate of $100 per day. Classical growth theory predicts that with technological advance, the economy will move first to point _______ and then to point _______.

b; c
f; e
d; e
d; a

An assumption of classical growth theory is that when ______________ the population growth rate _________.

people become more skilled; decreases
real wage rate exceeds the subsistence real wage rate; increases
saving declines; decreases
real wage rate decreases; increases

Please enter your name and press the SEND button