Question

Question 16:

In a small European country, it is estimated that changing the level of capital from $8 million to $10 million will increase real GDP from $2 million to $3 million. What level of GDP would you expect the economy to be able to reach if spending on capital continued to rise to $12 million, assuming no technological change and no change in the hours of work?

A)	GDP would increase further by more than $1 million

B)	GDP would increase further by exactly $4 million.

C)	GDP would increase further by exactly $1 million.

D)	GDP would increase further, but by less than $1 million.

In a small Asian country, it is estimated that a $10,000 increase in capital per hour worked will increase real GDP per hour worked by $600. Based on this information, what is the slope of the per-worker production function in this range?

Question 17 options:

A)

0.06

B)

6.6

C)

66.6

D)

666

Question 14 (1 point)

Technological change will

A)	shift the per-worker production function down.

B)	move the economy to a point beneath the per-worker production function.

C)	shift the per-worker production function up.

D)	move the economy along a given per-worker production function.

Question 10 (1 point)

The economic growth model predicts that

A)	economic growth in rich countries can only be accomplished at the expense of slow or even negative growth in poor countries.

B)	the per-worker production function of poor countries will be flatter than the per-worker production function of rich countries.

C)	the level of real GDP per capita in poor countries will grow faster than in rich countries.

D)	lower-income industrial countries will forever be unable to catch up to higher-income industrial countries.

Question 2 (1 point)

Which of the following is a normative statement about economic growth?

A)	Economic growth increases GDP per capita.

B)	Economic growth is associated with higher labor productivity growth.

C)	Foreign direct investment stimulates economic growth.

D)	Economic growth hurts developing countries.

Answer 1

Ans) the correct option is D) GDP would increase further, but by less than $1 million

Slope = (3-2)/(10-8) = 1/2

ans) the correct option is A) .06

slope of the per-worker production function= 600/10,000

ans) the correct option is c) shift the per-worker production function up.

ans) the correct option is c) the level of real GDP per capita in poor countries will grow faster than in rich countries.

ans) the correct option is d) Economic growth hurts developing countries.