HW 5 ECON 252 Questions with Correct Answers (Grade A+)
Question 1: Economic growth refers to the increase in _________ GDP per capita of an economy.
Assume GDP per capita in constant dollars was $30 comma 000 for 2003 and $39 comma 500 for 2004.
Answer: real
Question 2: A country with a very low per capita GDP can have a very high growth rate because
mathematically, when the ______________ is _______________ , even a small difference in the
____________ will result in a large growth rate.
Answer: denominator, lower, numerator
Question 3: What is the Rule of 70?
Answer: Shorthand for calc how long it will take to double an amount give the growth rate (g). 70 / g
Question 4: A relatively simple method of gauging the change in living standards over time within a
country is to compute _______________- GDP per capita.
Answer: real
Question 5: Catch-up growth is the ____________.
Answer: process by which relatively poorer nations increase their incomes by taking advantage of the
knowledge and technologies already invented in other technologically advanced nations.
Question 6: An example of catch-up growth is ____________.
Answer: South Korea, which by 1970 had become poorer relative to the United States, but over the last 40
years grew faster than the United States, closing the gap that had opened up previously.
Question 7: Sustained growth is the ____________.
Answer: process where GDP per capita grows at a positive and relatively steady rate for long periods of
time.
Question 8: An example of sustained growth is ____________.
Answer: the United States, which demonstrated sustained growth between 1820 and
Question 9: Physical capital accumulation is driven by ____________.
Answer: investment
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Question 1: Economic growth refers to the increase in _________ GDP per capita of an economy.
Assume GDP per capita in constant dollars was $30 comma 000 for 2003 and $39 comma 500 for 2004.
Answer: real
Question 2: A country with a very low per capita GDP can have a very high growth rate because
mathematically, when the ______________ is _______________ , even a small difference in the
____________ will result in a large growth rate.
Answer: denominator, lower, numerator
Question 3: What is the Rule of 70?
Answer: Shorthand for calc how long it will take to double an amount give the growth rate (g). 70 / g
Question 4: A relatively simple method of gauging the change in living standards over time within a
country is to compute _______________- GDP per capita.
Answer: real
Question 5: Catch-up growth is the ____________.
Answer: process by which relatively poorer nations increase their incomes by taking advantage of the
knowledge and technologies already invented in other technologically advanced nations.
Question 6: An example of catch-up growth is ____________.
Answer: South Korea, which by 1970 had become poorer relative to the United States, but over the last 40
years grew faster than the United States, closing the gap that had opened up previously.
Question 7: Sustained growth is the ____________.
Answer: process where GDP per capita grows at a positive and relatively steady rate for long periods of
time.
Question 8: An example of sustained growth is ____________.
Answer: the United States, which demonstrated sustained growth between 1820 and
Question 9: Physical capital accumulation is driven by ____________.
Answer: investment
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