Questions and Answers
Some prominent members of the slow-economic growth country club include a high-income country like _________.
Germany
Over the long run, ____________ per hour is the most important determinant of the average wage level in any economy.
productivity
An economy's rate of productivity growth is closely linked to the growth rate of its ______________.
GDP per capita
The value of what is produced per worker, or per hour worked, is called ____________.
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Which of the following factors contribute to economic growth?
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In macroeconomics, the connection from inputs to outputs for the entire economy is called _______________.
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A nation can achieve higher economic growth if:
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To achieve a high standard of living, a nation should:
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A country will roughly double its GDP in twenty years if its annual growth rate is:
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Which of the government policies below is most unlikely to encourage per capita economic growth?
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A nation's prosperity is sometimes measured in terms of ___________.
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Which of the following is most likely to contribute to economic growth as measured by GDP per capita?
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Which of the following is correct?
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Which of the following best describes the relationship between economic growth and literacy?
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Which of the following factors contribute to economic growth?
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Over the long run, ____________ per hour is the most important determinant of the average wage level in any economy.
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A nation can achieve higher economic growth if:
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Investment in human capital:
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Since the late 1950s, economists have performed "growth accounting" studies in the United States. These have determined that ________________ is typically the most important contributor to U.S. economic growth.
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Which of the following is unlikely to affect the rate of economic growth?
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Economists typically measure economic growth by tracking:
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In the long run, the most important source of increase in a nation's standard of living is a:
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_____________________ is a term which refers to the widespread use of power-driven machinery and the economic and social changes that resulted in the first half of the 1800s.
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Country Able and Country Baker initially have the same real GDP per capita. Country Able experiences no economic growth, while Country Baker grows at a sustained rate of 7 percent. In 12 years, Country Baker's GDP will be approximately ___________ that of Country Able.
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When discussing economic growth, it is often useful to focus on ____________, to avoid studying changes in the size of GDP that represent only having more people in the economy, and focus on those increases in GDP which represent an actual rise in the standard of living on a per person basis.
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Assuming a country's economy maintains an 8% rate of growth, young adults starting at age 20 would see the average standard of living in their country more than double by the time they had reached age:
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Increased investment alone will guarantee economic growth.
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____________ is a term which refers to the widespread use of power-driven machinery and the economic and social changes that resulted in the first half of the 1800s.
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When society has a higher level of capital per person, it is called ______________.
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In the long run, the most important source of increase in a nation's standard of living is a:
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Study Notes
Macroeconomics Concepts
- Germany is an example of a high-income country with slow economic growth.
- Productivity per hour is crucial for determining average wage levels in an economy.
- The growth rate of GDP per capita is closely linked to productivity growth rates.
- Productivity refers to the output value produced per worker or per hour worked.
- Economic growth factors include increases in education levels and the average wage rate, while decreases in labor productivity are detrimental.
Economic Growth Determinants
- An aggregate production function describes how inputs relate to outputs for the entire economy.
- Higher economic growth can be achieved by increasing research and development resources.
- Promoting economic growth is essential for attaining a high standard of living.
- A nation with a 3.5% annual growth rate can approximately double its GDP in twenty years.
Government and Economic Policies
- High taxes on companies that invest in capital formation are unlikely to boost per capita economic growth.
- GDP per capita serves as a measure of a nation's prosperity.
- Increased capital formation positively affects GDP per capita growth.
- Investing in human capital, such as through education and training, is critical for economic advancement.
Education and Literacy
- Enhanced education increases the stock of human capital, similar to how factories add to physical capital.
- Improved literacy rates contribute to economic growth by enhancing labor productivity.
Resources and Economic Contributions
- Discovering new resources, such as oil, significantly contributes to economic growth.
- Despite previous findings, technological advancements typically remain the leading contributor to U.S. economic growth since the late 1950s.
Measuring Economic Growth
- Economic growth is commonly measured via real GDP per capita.
- Long-term economic growth is the key factor for increasing a nation's standard of living.
- The Industrial Revolution marked the transition to power-driven machinery and initiated significant economic and social changes.
Growth Projections
- Country Baker, growing at 7%, will double its GDP compared to Country Able within 12 years, which shows the impact of sustained growth rates.
- Focus on GDP per capita enables analysis of living standards beyond mere population increases.
- Maintaining an 8% growth rate from age 20 would lead to more than double the standard of living by age 30.
Investment and Economic Outcomes
- While increased investment is important, it does not guarantee economic growth; the quality of investment and technology plays a significant role.
- Capital deepening refers to enhanced capital availability per person, influencing productivity and growth outcomes.
Studying That Suits You
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Description
Test your knowledge with these flashcards from Chapter 20 of Macroeconomics. Covering key terms such as productivity and economic growth, these cards will help reinforce important concepts for your studies. Perfect for exam preparation or a quick review!
