Chapter 6--MacroTB - CHAPTER 6 Growth and Ideas...

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MULTIPLE-CHOICE 1. In Romer’s influential paper he divided the economic world into a. resources and ideas. b. objects and resources. c. objects and ideas. d. utilities and objects. e. None of the above. Answer: c. Section: 6.1 2. Which of the following are (an) example(s) of idea(s) ? a. new irrigation techniques b. turning sand into computer chips c. the assembly line d. All of the above. e. None of the above. Answer: d. Section: 6.1 3. Which of the following flowcharts best summarizes Romer’s description of ideas and growth? a. Ideas Nonrivalry Increasing returns Imperfect competition b. Ideas Capital Constant returns Imperfect competition c. Capital Rivalry Increasing returns Perfect competition d. Ideas Rivalry Increasing returns Perfect competition e. Capital Nonrivalry Decreasing returns Imperfect competition Answer: a. Section: 6.2 4. The amount of raw material in the universe—the amount of sand, oil, and the number of atoms of carbon, oxygen, etc.—is __________. And the number of ways of arranging and using these raw materials is __________. a. finite; also finite b. infinite; virtually infinite c. finite; virtually infinite d. virtually infinite; zero e. zero; infinite Answer: c. Section: 6.2 5. In economics, a rival good is one that a. cannot be consumed by more than two persons at a time. b. can be consumed by more than one person at a time. c. can be consumed by more than one person at a time but is congested. d. cannot be consumed by more than one person at a time. e. None of the above. Answer: d. Section: 6.2 6. In economics, a nonrival good is one that a. cannot be consumed by more than one person at a time. b. can be consumed by more than one person at a time. c. can be consumed by more than one person at a time but is congested. d. cannot be consumed by more than two persons at a time. e. None of the above. Answer: b. Section: 6.2 52 Growth and Ideas CHAPTER 6
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Growth and Ideas | 53 7. Which of the following are nonrival goods? a. a peanut butter sandwich b. orange juice c. a jacket d. All of the above. e. None of the above. Answer: e. Section: 6.2 8. Which of the following are nonrival goods? a. a TV signal b. a blueprint c. national defense d. All of the above. e. None of the above. Answer: d. Section: 6.2 9. If there are large fixed or research and development costs, such as in the pharmaceutical industry, production can characterized by a. negative costs. b. constant returns to scale. c. decreasing returns to scale. d. large variable costs. e. increasing returns to scale. Answer: e. Section: 6.2 10. If Y is a good’s output, X is spending producing a good, F ± is the fixed cost associated with production, and C is is the average cost of production, which of the following production functions exhibits increasing returns? a. Y = ( CX – F ± ) b. Y = ( X – F ± ) • C c. Y = ( F ± – X )/ C d. Y = ( X – F ± )/ C e. Y = ( X – F ± C ) Answer: d.
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Chapter 6--MacroTB - CHAPTER 6 Growth and Ideas...

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