econ 2200 - Study Guide - Test 2

econ 2200 - Study Guide - Test 2 - ECON 2200-Moore Study...

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ECON 2200-Moore Study Guide for Test 2 1. Use Tables 17.1 and 17.2 to describe postbellum growth in both the labor force and output across various sectors of the economy. In which sectors was productivity growth greatest? -total labor force grew by multiple of 3.4 while total output grew by a greater multiple. Railroads grew the most in labor force and output. Agriculture labor/output multiple = 2/3.7 while manufacturing = 5.4/10.8 -this shows evidence of productivity growth(strongest in manufacturing, RR, steel, iron and steel 2. What is “valued added?” Use Table 17.5 to describe changes in value added per worker in the reunification period. Why does value added per worker tend to be higher in “high tech” industries? Use examples from Table 17.5 to illustrate your answer. Value added = value of final product – total cost of product, -productivity growth especially high for boots and men’s clothing(standardized sizes developed) 3. Use examples from Table 17.3 to show how changes in the major U.S. industries (ranked by value added) mirrored changes in society. How did the #1-ranked good change between 1860 and 1910? What goods were on the list of top industries in 1860, but no longer included in 1910? What new industries were added to the list in 1910? Use the concept of income elasticity to explain the declining position of goods like flour and woolen goods and the increasing position of goods like malt liquors and tobacco. -U.S. changed from being a predominantly agriculture society to a manufacturing society. In 1860 cotton goods were the leading industries for value added, but in 1910 machinery was tops in value added -Flour and Meal, woolen goods, carriages and wagons, and leather all dropped off the list -Printing and Publishing, malt liquor, tobacco manufactures, and railroad cars all were added -flour and woolen goods are income inelastic so as income rose due to increased manufacturing, the amount bought didn’t increase by as much -malt liquor and tobacco are income elastic so people start buying these more as they earned more money 4. How did technological changes (both invention and innovation) fuel late-19 th century manufacturing growth? Give particular attention to technological changes in the steel industry, as described in Economic Insight 17.1. -allowed for mass production of manufactured goods. RR allow manufactured goods to be sold on “national market”… RR and Mass production allow firms to take advantage of economies of scale -the invention of the Bessemer and open hearth processes allowed for steel to be produced in mass production. In 1870 69 long tons of steel are produced and by 1910 26,095 tons are produced -bessemer was created first, but open hearth became more dominant because it was more econical and allowed for better refining 5. What are the two components of mass production? How does mass production allow for firms to take advantage of economies of scale? Describe, for example, how mass production changed the boot and shoe
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econ 2200 - Study Guide - Test 2 - ECON 2200-Moore Study...

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