CH 7 (Economic growth) Questions With Complete Solutions

[QUESTION] The rate of growth in real GDP per person in the United States, Japan, Canada, Australia and the major European economies was highest during the period of: A. B. C. D. Difficulty: Easy correct answer: D [QUESTION] The costs of economic growth include all of the following EXCEPT consumption sacrificed for: A. physical capital formation B. acquiring new human capital C. research and development into new technologies D. additional hours of leisure Difficulty: Moderate correct answer: D [QUESTION] Additional economic growth should be pursued when: A. new technologies are discovered B. people desire more goods and services C. scarcity exists D. the marginal costs of growth are less than the marginal benefits Difficulty: Easy correct answer: D [QUESTION] The benefits of economic growth are _____, while the costs of economic growth are _____. A. increased output per person; too small for concern B. increased output per person; the consumption sacrificed to capital formation C. increased output per person; less future consumption D. more current consumption; less future consumption Difficulty: Moderate correct answer: B [QUESTION] The cost of a higher living standard in the future is giving up: A. current consumption B. current investment C. future consumption D. future investment Difficulty: Easy correct answer: A [QUESTION] The principal economic cost of growth is: A. higher interest rates B. higher inflation rates C. higher unemployment rates D. consumption sacrificed for capital formation