ECON 1500 Exam 2 with correct detailed
| | | | | | |
answers
The |focus |of |the |Classical |growth |model |is |- |CORRECT |ANSWER-aggregate |demand
interest |rates
**investment
technology
The |focus |of |the |New |Growth |model |is |- |CORRECT |ANSWER--aggregate |demand
-interest |rates
-investment
**technology
Which |of |the |following |factors |will |not |shift |the |long-run |aggregate |supply |curve |to |the |right? |- |
CORRECT |ANSWER-**An |increase |in |the |labor |force |participation |rate
-Better |institutional |arrangements
-An |increase |in |the |price |level
-An |improvement |in |technology
Which |of |the |following |policies |will |likely |contribute |to |strong |economic |growth? |- |CORRECT |
ANSWER--Low |taxes |on |the |returns |to |saving |
| -Quality |research |and |teaching |universities |
| -Strong |Patent |law |which |encourages |innovation |
| **All |of |the |above |are |correct
In |the |long |run, |what |determines |the |level |of |output |is |the |AS-AD |model? |- |CORRECT |ANSWER--SRAS
-AD
**LAS
, -Trump |with |a |little |help |from |Adam |Shiff
All |of |the |following |are |important |sources |of |growth |except |- |CORRECT |ANSWER--Competitive |
markets
-Enforcement |of |property |rights
**Low |labor |force |participation |rates
-Capital |accumulation
Which |will |increase |the |rate |of |capital |accumulation? |- |CORRECT |ANSWER-Lower |levels |of |investment |
| Higher |levels |of |investment |
| Higher |levels |of |saving |
| **Both |B |and |C |are |correct
Which |institutional |arrangement |is |more |consistent |with |high |GDP |per |capita? |- |CORRECT |ANSWER--
Socialism
-Restrictions |on |international |trade
-Government |imposed |price |controls
**Markets, |specialization |and |trade
We |can |show |economic |growth |in |terms |of |the |production |possibility |curve |by: |- |CORRECT |ANSWER--
movement |along |the |production |possibility |curve
-shifting |from |a |point |inside |the |curve |to |a |point |on |the |production |possibility |curve
**shifting |the |production |possibility |curve |outward
-jumping |to |a |point |outside |the |production |possibility |curve
Robert |Lucas |reflects |the |view |of |many |economists |when |he |argues |that |the |most |effective |way |to |
reduce |world |poverty |is |to: |- |CORRECT |ANSWER--eliminate |recessions
**increase |long-run |growth
-provide |loans |to |developing |countries
-take |money |from |those |who |are |very |wealthy |and |give |to |those |who |are |very |poor
| | | | | | |
answers
The |focus |of |the |Classical |growth |model |is |- |CORRECT |ANSWER-aggregate |demand
interest |rates
**investment
technology
The |focus |of |the |New |Growth |model |is |- |CORRECT |ANSWER--aggregate |demand
-interest |rates
-investment
**technology
Which |of |the |following |factors |will |not |shift |the |long-run |aggregate |supply |curve |to |the |right? |- |
CORRECT |ANSWER-**An |increase |in |the |labor |force |participation |rate
-Better |institutional |arrangements
-An |increase |in |the |price |level
-An |improvement |in |technology
Which |of |the |following |policies |will |likely |contribute |to |strong |economic |growth? |- |CORRECT |
ANSWER--Low |taxes |on |the |returns |to |saving |
| -Quality |research |and |teaching |universities |
| -Strong |Patent |law |which |encourages |innovation |
| **All |of |the |above |are |correct
In |the |long |run, |what |determines |the |level |of |output |is |the |AS-AD |model? |- |CORRECT |ANSWER--SRAS
-AD
**LAS
, -Trump |with |a |little |help |from |Adam |Shiff
All |of |the |following |are |important |sources |of |growth |except |- |CORRECT |ANSWER--Competitive |
markets
-Enforcement |of |property |rights
**Low |labor |force |participation |rates
-Capital |accumulation
Which |will |increase |the |rate |of |capital |accumulation? |- |CORRECT |ANSWER-Lower |levels |of |investment |
| Higher |levels |of |investment |
| Higher |levels |of |saving |
| **Both |B |and |C |are |correct
Which |institutional |arrangement |is |more |consistent |with |high |GDP |per |capita? |- |CORRECT |ANSWER--
Socialism
-Restrictions |on |international |trade
-Government |imposed |price |controls
**Markets, |specialization |and |trade
We |can |show |economic |growth |in |terms |of |the |production |possibility |curve |by: |- |CORRECT |ANSWER--
movement |along |the |production |possibility |curve
-shifting |from |a |point |inside |the |curve |to |a |point |on |the |production |possibility |curve
**shifting |the |production |possibility |curve |outward
-jumping |to |a |point |outside |the |production |possibility |curve
Robert |Lucas |reflects |the |view |of |many |economists |when |he |argues |that |the |most |effective |way |to |
reduce |world |poverty |is |to: |- |CORRECT |ANSWER--eliminate |recessions
**increase |long-run |growth
-provide |loans |to |developing |countries
-take |money |from |those |who |are |very |wealthy |and |give |to |those |who |are |very |poor
