Question 1

In a Malthusian world,what events would improve permanently the standard of living,as measured by output per capita?

Accepted Answer

A)   a peace keeping mission
B)   an increase in violent crime
C)   a new mutation of germs
D)   a new sewer systemE) B) and C)
F) None of the above

Question 2

Before the Industrial Revolution,standards of living differed

Accepted Answer

A)   greatly over time and across countries.
B)   little over time, but differed greatly across countries.
C)   greatly over time, but differed little across countries.
D)   little over time and across countries.E) B) and C)
F) A) and C)

Question 3

In the Solow growth model,an increase in the savings rate

Accepted Answer

A)   raises steady state per capita output.
B)   raises the growth rate in aggregate output.
C)   must reduce per capita consumption.
D)   must reduce the standard of living.E) A) and B)
F) C) and D)

Question 4

Recent evidence suggests that output per worker is

Accepted Answer

A)   positively related to both the rate of investment and to the rate of population growth.
B)   positively related to the rate of investment and negatively related to the rate of population growth.
C)   negatively related to the rate of investment and positively related to the rate of population growth.
D)   negatively related to both the rate of investment and to the rate of population growth.E) C) and D)
F) A) and C)

Question 5

Why do we analyze the steady state in the Malthusian model?

Accepted Answer

A)   Because that is all we know how to do.
B)   Because there is a non-steady state that is not interesting.
C)   Because this is the Pareto optimum.
D)   Because the long run equilibrium of the model is the steady state.E) A) and B)
F) A) and C)

Question 6

Growth in the Solow residual was fastest in the

Accepted Answer

A)   1950s.
B)   1960s.
C)   1970s.
D)   1980s.E) A) and B)
F) A) and C)

Question 7

In Solow's exogenous growth model,the principal obstacle to continuous growth in output per capita is due to

Accepted Answer

A)   the declining marginal product of labor.
B)   the declining marginal product of capital.
C)   limits in the ability of government policymakers.
D)   too little savings.E) B) and C)
F) A) and B)

Question 8

In a Malthusian world,what event would improve temporarily the standard of living,as measured by output per capita?

Accepted Answer

A)   a peace keeping mission
B)   an increase in violent crime
C)   a new mutation of germs
D)   a new sewer systemE) A) and C)
F) All of the above

Question 9

In a Malthusian world,why is misery recurrent?

Accepted Answer

A)   The marginal returns of capital are decreasing.
B)   Fertility is endogenous.
C)   Output is increasing in labor.
D)   Mortality depends on the standard of living.E) A) and D)
F) All of the above

Question 10

In the Malthusian model,state-mandated population control policies are likely to

Accepted Answer

A)   decrease the equilibrium size of the population and increase the equilibrium level of consumption per worker.
B)   decrease the equilibrium size of the population and have no effect on the equilibrium level of consumption per worker.
C)   have no effect on the equilibrium size of the population and increase the equilibrium level of consumption per worker.
D)   have no effect on either the equilibrium size of the population or the equilibrium level of consumption per worker.E) A) and B)
F) A) and C)

Question 11

With an increase in total factor productivity in the Solow growth model,

Accepted Answer

A)   output decreases temporarily and returns to the previous steady state.
B)   output increases temporarily and returns to the previous steady state.
C)   the economy reaches a steady state with higher output.
D)   the economy reaches a steady state with lower output.E) B) and C)
F) C) and D)

Question 12

The Malthusian model emphasizes fixity in which of the following factors of production?

Accepted Answer

A)   labor
B)   land
C)   energy
D)   none of the aboveE) None of the above
F) A) and B)

Question 13

When we compare poor and rich countries in the world

Accepted Answer

A)   There is much greater dispersion in growth rates in per capita income for the poor countries than for the rich countries.
B)   The investment rate is higher for poor countries than for rich countries.
C)   There is much greater dispersion in growth rates in per capita income for the rich countries than for the poor countries.
D)   Population growth rates are higher in rich countries than in poor countries.E) B) and D)
F) A) and B)

Question 14

In the Malthusian model,an improvement in the technology of growing food is likely to

Accepted Answer

A)   increase the equilibrium size of the population and increase the equilibrium level of consumption per worker.
B)   increase the equilibrium size of the population and decrease the equilibrium level of consumption per worker.
C)   increase the equilibrium size of the population and have no effect on the equilibrium level of consumption per worker.
D)   have no effect on the equilibrium size of the population and increase the equilibrium level of consumption per worker.E) A) and C)
F) All of the above

Question 15

Which of the following,if implemented in the Solow growth model,would not lead to a steady state?

Accepted Answer

A)   A higher population growth rate.
B)   Decreasing returns to scale in production.
C)   A savings rate that decreases as income increases.
D)   A constant marginal product of capital.E) B) and C)
F) A) and D)

Question 16

Which of the following is not a feature of the steady state in Solow's exogenous growth model?

Accepted Answer

A)   The capital/output ratio is steady.
B)   Capital grows continuously.
C)   Consumption per worker is steady.
D)   Total saving is steady.E) B) and C)
F) All of the above

Question 17

Growth in the Solow residual was slowest in the

Accepted Answer

A)   1950s.
B)   1960s.
C)   1970s.
D)   1980s.E) B) and D)
F) A) and B)

Question 18

In Solow's exogenous growth model,the steady-state growth rate of capital can be increased by

Accepted Answer

A)   higher population growth.
B)   higher depreciation rate.
C)   higher saving rate.
D)   higher interest rate.E) B) and D)
F) A) and C)

Question 19

If an epidemic hits a Malthusian economy,the immediate consequence is

Accepted Answer

A)   an increase in the standard of living.
B)   a reduction in the standard of living.
C)   no change in the standard of living.
D)   dependent on the population growth rate.E) A) and B)
F) A) and C)

Question 20

One plausible explanation of the U.S. productivity slowdown starting in 1973 is that it was the result of the time needed to adapt to new technology. This explanation would require that

Accepted Answer

A)   workers withdraw from the labor force to learn about the new technology.
B)   a large number of new entrants be attracted to the labor force.
C)   managers be reluctant to adopt changes.
D)   workers time at their jobs be diverted from production to learning the technology.E) None of the above
F) A) and B)

Exam 7: Economic Growth: Malthus and Solow

Recent evidence suggests that output per worker is

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Why do we analyze the steady state in the Malthusian model?

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Growth in the Solow residual was slowest in the

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In a Malthusian world,what events would improve permanently the standard of living,as measured by output per capita?

Correct AnswerverifiedShow Answer

In Solow's exogenous growth model,the principal obstacle to continuous growth in output per capita is due to

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In the Solow growth model,an increase in the savings rate

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If an epidemic hits a Malthusian economy,the immediate consequence is

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Which of the following,if implemented in the Solow growth model,would not lead to a steady state?

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The Malthusian model emphasizes fixity in which of the following factors of production?

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In Solow's exogenous growth model,the steady-state growth rate of capital can be increased by

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When we compare poor and rich countries in the world

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With an increase in total factor productivity in the Solow growth model,

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In a Malthusian world,why is misery recurrent?

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In the Malthusian model,an improvement in the technology of growing food is likely to

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In the Malthusian model,state-mandated population control policies are likely to

Correct AnswerverifiedShow Answer

One plausible explanation of the U.S. productivity slowdown starting in 1973 is that it was the result of the time needed to adapt to new technology. This explanation would require that

Correct AnswerverifiedShow Answer

Before the Industrial Revolution,standards of living differed

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Which of the following is not a feature of the steady state in Solow's exogenous growth model?

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In a Malthusian world,what event would improve temporarily the standard of living,as measured by output per capita?

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Growth in the Solow residual was fastest in the

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