Study_Guide (2) - Study Guide Fall 2010 ECON 2200-Moore...

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Unformatted text preview: Study Guide Fall 2010 ECON 2200-Moore Study Guide for Exam 2 1. Use Tables 17.1 and 17.2 to describe late-19th century growth in both the labor force and output across various sectors of the economy. Which sectors exhibited productivity growth? In which sectors was productivity growth greatest ? (Table 17.1) Labor force expansion in most industries, but the labor force expansion is greatest in manufacturing and especially Railroads. Between 1860 and 1910 the labor force of agriculture was multiplied by 2. But in sectors of total manufacturing, trade, mining, and primary iron and steel grew by multiples of 5.4 to 7.1. Railroads grew by a multiple 23.2! (Table 17.2) Output expansion as well. In agriculture output growth greater than labor force growth so evidence of increased productivity. In manufacturing output growth also greater than labor force growth, but by a much larger amount than agriculture so much larger productivity growth than agriculture. Summation: Productivity growth is evident in all listed sectors, but is greatest for manufacturing, iron and steel, and railroad freight carrying. Railroad freight had the greatest productivity growth 2. What is valued added? Use Table 17.5 to describe changes in value added per worker in the Reunification Period. Describe the productivity gains reflected in the data provided in the table. Value added- measures the total value of output (what you sell your product for) minus material costs (the raw materials used to produce a product i.e. the material costs of iron and steel would be iron ore, and the material costs for cotton goods would be the actual cotton); therefore, value added per worker reflects both labor and capital productivity. So value added is the value we add to products by manufacturing them! Across the board, the value added per worker increases in all sectors! Most pronounced in means clothing and boots & shoes. The production of clothing and boots and shoes became more mechanized (standardized sizing instead of custom fitting for every person), explaining the increase in productivity. Also, much innovation in iron and steel in the smelting process. 3. Use examples from Table 17.3 to show how changes in the major US industries (ranked by value added) mirrored changes in the US economy and society. Discuss the change in the #1-ranked good 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. In 1860, Cotton textiles manufacturing is often the first manufacturing industry that a country embraces....
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Study_Guide (2) - Study Guide Fall 2010 ECON 2200-Moore...

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