Pakhotina Econ 203 Exam 2 || with Error-free Solutions.
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Course
Pakhotina Econ 203
Institution
Pakhotina Econ 203
what does economic growth do? correct answers increases opportunities and generates wealth
rapid economic growth is a correct answers modern phenomenon
growth rate correct answers [(value in current year - value in previous year)/value in previous year] *100
real GDP per capita growth rate...
Pakhotina Econ 203 Exam 2 || with Error-free Solutions.
what does economic growth do? correct answers increases opportunities and generates wealth
rapid economic growth is a correct answers modern phenomenon
growth rate correct answers [(value in current year - value in previous year)/value in previous
year] *100
real GDP per capita growth rate= correct answers nominal GDP growth rate-inflation rate-
population growth rate
economic growth builds on- correct answers itself over time
economic growth process is similar to correct answers compounding interest in a savings account
even a small annual growth rate can- correct answers add up to a large change in an economy
over time
U.S. average annual growth in real GDP per capita was correct answers 2% during last century
2010 Real GDP per capita is correct answers 7 times larger than in 1910
GDP per capita in any year correct answers GDPyr A= GDPyrb*((1+(growth
rate%/100))/100)^(yearA-yearB)
a simple shortcut to understand how many years it takes for GDP to double is correct answers the
rule of 70
year until incomes doubles= correct answers 70/growth rate%
productivity- correct answers is measure of the output per worker and is what drives growth
output per worker= correct answers GDP per capita
chain of productivity: correct answers increase in productivity-increase in per capita income-
ecconomic growth
components of productivity correct answers physical capital, human capital, technological
improvements, natural resources
physical capital correct answers the stock pf equipment and structures used to produce goods and
services
-factories, machines, pipelines, cell phone towers...
as increased workers become more productive
, human capital correct answers set of skills, knowledge, experience, and talent that determine the
productivity of workers
increased with education and health
human capital chain of productivity correct answers increase human capital-workers produce
more with the same amount of capital (increase in productivity
technological improvements correct answers innovations that cause the same inputs to produce
more outputs with same amount of physical capital
-internet invention, high yielding sees in agriculture
natural resources correct answers production inputs that come from the earth
renewable: trees, rivers
nonrenewable: coal, oil
strong economic growth increases correct answers the standard of living
public policy aims to correct answers spark and sustain growth
there is no _____ public policy correct answers one size fits all
public policies that enhance ecconmic growth correct answers investment (physical capital)
education and health (human capital)
technological development (tech improvements)
good government, property rights, economic openness (to ensure efficient use of physical capital,
human capital, technology, and natural resources)
investment and savings chain: correct answers savings=investments=increase in physical capital
savings=economic growth
increase in savings means correct answers decrease in todays consumption
domestic savings correct answers savings for capital investment that comes from within a
country
2 sources domestic savings f=come from correct answers households spending less than they
earn and government revenue exceeding non-capital expenditures
household saving rates greatly vary across countries by correct answers developing countries
save more and developed countries save less
foreign direct investment (FDI) correct answers when a firm runs part of its operation abroad or
invest in another company abroad
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