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ECO213 Exam #2 Questions And Accurate Answers
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ECO213 Exam #2 Questions And Accurate AnswersU.S. real GDP in 2018 was $18,638 billion, and real GDP in 2019 was $19,073 billion
(constant 2012 $). What was the rate of growth in U.S. real GDP from 2018 to 2019. just
prior to the coronavirus pandemic? - Answer 2.3%
The best economic measure of the standard of living is - Answer real GDP per capita
Suppose an economy is growing at a rate of 2.5% per year. How many will it take the
economy to double in size? - Answer 28 years
Workers in ________ countries have ________ to work with than do workers in low income
countries. - Answer high income; more physical capital
Lower government spending will ________ the federal budget deficit. - Answer lower
A government budget deficit will shift the ________ curve for loanable funds to the
________ and the equilibrium real interest rate will _________. - Answer supply; left; rise
Technological change is shown in the above diagram by the movement from - Answer B
to D
Endogenous growth theory - Answer states that the rate of technological change is
caused by economic incentives
An increase in ________ shifts the production function________, and makes it possible to
produce a higher level of GDP with ________ capital per hour worked. - Answer
technology; up; the same amount of
, Which of the factors of production does Joseph Schumpeter argue is at the heart of
economic growth? - Answer the entrepreneur
Which of the following is the correct description of the effect of the rule of law on a
country's growth rate? - Answer Countries with good rule of law that secures property
rights and enforces contracts grow faster
Globalization (international trade, open economies, free flow of capital and labor,
economic interdependence among countries) is positively associated with - Answer
economic growth
Corruption of a country's government and ruling officials-Answer undermines the rule of
law and curtails economic growth
If property rights are not enforced in a country-Answer entrepreneurs are unlikely to
invest their own funds in such a country
Policies to promote growth by increasing savings and investment work through -
Answer increasing the supply of loanable funds, lowering the interest rate, raising the
level of investment in physical capital
In the above diagram, the movement from A to B to C illustrates - Answer an increase in
capital per worker and diminishing returns to capital
Suppose the economy accumulates more capital per hour worked and improves its
technology. This is how this would appear in the above figure by shifting from- Answer A
to D
The aggregate expenditure model analyzes the interaction between ________ and
________ in the short run, holding ________ fixed. -Answer total planned spending; real
GDP; the price level
Which of the following is the largest component of aggregate expenditure? - Answer
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