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E) increases in the price of inputs. 19) 3 20) The Solow growth model predicts that a country s standard of living can continue to increase in
the long run only if
A) there is sustained increases in the population.
B) there is sustained increases in the labour force.
C) there is sustained increases in government spending.
D) there is sustained increases in total factor productivity.
E) there is sustained increases in the capital stock. 20) 21) One plausible explanation of the Canadian productivity slowdown starting in 1973 is that it was a
result of the increase in the relative price of energy. This explanation would require that, in light of
higher energy costs, the
A) labour force is underestimated.
B) capital stock and the labour force were overestimated.
C) capital stock is underestimated.
D) labour force is overestimated.
E) capital stock is overestimated. 21) 22) The per worker production function relates output per worker
A) total factor productivity.
B) to the participation rate.
C) in different countries.
D) to production per worker.
E) to capital per worker. 22) 23) The per worker production function describes the relationship between
A) capital per worker and total factor productivity.
B) government spending and total factor productivity.
C) consumption per worker and income per worker.
D) labour supply and land per worker.
E) output per worker and land per worker. 23) 24) The Solow model emphasizes the role of which of the following factors of production?
E) natural resources 24) 25) The biggest contribution to real Canadian GDP growth in the 1970s was due to growth in
A) the capital stock.
B) the labour force.
C) total factor productivity.
D) both the capital stock and the labour force.
E) the size of government. 25) 26) Before the Industrial Revolution, standards of living differed
A) greatly over time, but was the same across countries.
B) little over time but differed greatly across countries.
C) little over time and across countries.
D) greatly over time and across countries.
E) greatly over time but differed little across countries. 26) 4 27) If changes in economic policy could cause the growth rate of real GDP to increase by 1% per year
for 100 years, then GDP would be ________ % higher after 100 years than it would have been
E) 4.2 27) 28) Countries in which a relatively small fraction of output is channeled into investment tend to have a
A) relatively high level of government spending.
B) relatively low rate of population growth.
C) relatively high rate of consumption.
D) relatively high level of capital stock.
E) relatively low standard of living. 28) 29) In the Malthusian model of the economy,
A) population growth is negatively correlated with consumption.
B) capital replaces land in the production function.
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This document was uploaded on 12/11/2013.
- Fall '13