Exploring Economic Growth: Definitions and Measurement

Chapter 28 1. Economists define and measure economic growth as ____. a. An increase in real GDP per capita over some period of time 2. Which of these explain why growth is an important economic goal? a. It increases real wages and incomes b. It increases a society’s ability to resolve socioeconomic problems c. It increases standard of living 3. Economists pay attention to small changes in economic growth because small changes in economic growth can make a big difference in the living ________ of a country a. Standard 4. Which of the following statements best summarizes the growth in real GDP in the United States between 1950 and 2018? a. Real GDP rose more than eightfold 5. Other than a higher standard of living and more innovations, which of the following are true to the impacts of modern economic growth in industrialized nations? a. Elimination of archaic social norms b. Increase in democracies c. Increased leisure time and arts 6. Which of the following are used by economists to define and measure economic growth? a. An increase in real GDP occurring over some time period b. An increase in real GDP per capita occurring over some time period. 7. Those countries which experienced modern economic growth earlier than other countries now have significantly _____. a. Higher standard of living 8. An economy that is experiencing economic ______ is better able to meet people’s wants and resolve socioeconomic problems. a. Growth 9. What are leader countries? a. Countries that develop and use the most advanced technologies 10. Why do economists pay so much attention to small changes in the rate of economic growth? a. These changes have large effects on the volume of output 11. Which of the following are growth-promoting institutional structures? a. Strong property rights b. Free trade c. Patents and copyrights d. Efficient financial institutions e. Competitive market system Which of the following statements best summarizes the real economic growth per capita in the United States between 1950 and 2018? a. Real GDP per capita rose nearly fourfold 13. Modern economic growth has significantly increased the standard of living as well as _____, social, and political arrangements. a. Cultural 14. The determinants that directly affect economic growth can be grouped into which of the following categories? a. Demand b. Efficiency c. Supply 15. True or False: Countries that experienced economic growth earlier than other countries have lower average incomes today. a. False 16. The four supply factors that constitute changes in physical and technical agents of production ______. a. Enable an economy to expand its potential GDP 17. Countries that develop and use the most advanced technologies, which then became available to follower countries, are known as ______ countries. a. Leader 18. The purchase of the economy’s expanding goods and services by households, businesses, and the government is known as the _____ factor. a. Demand 19. Strong property rights, ______ trade, patents and ______ market systems are all growth-promoting institutional structures. a. Free b. Competitive 20. Efficiency factor is when an economy must achieve economic efficiency as well as _________ ________ to reach its full production. a. Full b. Employment 21. The six “determinants” of economic growth are grouped into three categories: one demand factor, four _________ factors, and one efficiency factor. a. Supply 22. Labor productivity is: a. Real output per hour of work 23. The supply factors that are part of the “determinants” of economic growth include increasing the quality and quantity of natural 12. and human resources, increasing the stock of capital, and improvements in _______. a. Technology 24. The two main supply-side elements that contribute to changes in real GDP are increases in hours worked and increases in ________. a. Labor productivity 25. The demand factor involves households, businesses, and government purchasing the economy’s expanding output of goods and services so that there will be _____. a. No unplanned increase in inventories and resources will remain fully employed. 26. Which of the following helps explain why the growth rate in the United States has been positive during the 1900s? a. The increase in labor productivity 27. Efficiency factor is when an economy must achieve economic efficiency as well as ______ to reach its full production potential. a. Full employment 28. Output per hour of work is the definition of: a. Labor productivity 29. What are the two supply-side elements of real GDP? a. Increases in labor productivity b. Increases in hours worked 30. Generally, technological advance is generated by the discovery of new ______ which allows ______ to be combined in improved ways that increase output. a. Knowledge b. Resources 31. A nation’s economic growth from one year to the next depends on its ______. a. Increase in labor inputs and increase in labor productivity 32. Ideally, a nation acquires funds for investment spending on plant and equipment by ______ income. a. Saving 33. Human capital refers to ______. a. Knowledge and skills that make a worker productive 34. Reactions in per-unit production costs that result from increases in output levels lead to _____ of _______. a. Economies b. Scale 35. An increase in productivity growth is important because real output, real income and real wages are linked to ______. a. Labor productivity 36. The largest contributor to productivity growth is through ________. a. Technological advancement The core element of the productivity speedup between 1995 and 2010 was an explosion of entrepreneurship and innovation based on _______. a. The microchip 38. Sources of funds for investment spending in plant and equipment are _____. a. Savings by households, governments, and foreigners. 39. Which of the following allow the economy to achieve a higher rate of economic growth? a. Stronger productivity growth and heightened global competition 40. Human capital refers to _____. a. The improvement in labor created by education and knowledge that is embodied in the work force. 41. What is potentially the result of overcapacity and the stalling of technological progress? a. A decline in productivity growth rates 42. Reductions in per-unit production costs that result from increases in output levels are called ____. a. Economies of scale 43. Which of produce the following are arguments against rapid economic growth? a. Rapid economic growth has not solved sociological problems like poverty and homelessness b. Rapid economic growth results in pollution, global warming, and other environmental problems c. Rapid economic growth is unsustainable due to the earth’s finite resources. 44. Increasing productivity leads to improved standards of living by increasing _______. a. Real hourly earnings 45. True or false: Growth enables society to improve nations’ infrastructure a. True 46. The core element of the productivity speedup between 1995 and 2010 was an explosion of entrepreneurship and innovations based on ______. a. The microprocessor 47. Stronger ______ growth and heightened ______ competition allow the economy to achieve a greater rate of economic growth. a. Productivity b. Global 37. 48. Which of the following are some possible reasons for the slowdown in productivity growth rates starting in 2010? a. Accumulation of high debt levels b. Recent products like internet apps that are free and do not generate a measurable effect on GDP 49. What do antigrowth economists cite as evidence in favor of their argument that growth is undesirable? a. Poverty b. Pollution c. Materialism 50. Economic growth provides society _____. a. Higher living standards b. Greater material abundance c. More goods and services