Question : 51) Employing an additional 1 billion hours of labor increases : 1240964

51) Employing an additional 1 billion hours of labor increases real GDP by $12 billion. Employing another 1 billion hours beyond the first 1 billion increases real GDP by $11 billion. Hence we can conclude from this information that as employment increases, real GDP

A) increases at an increasing rate.

B) decreases at an increasing rate.

C) decreases at a decreasing rate.

D) increases at a decreasing rate.

E) falls from $12 billion to $11 billion as more workers are hired.

52) If adding an initial 100 billion labor hours per year increases real GDP by $3 trillion, diminishing returns informs us that an additional 100 billion labor hours per year will increase real GDP by

A) exactly $3 trillion.

B) less than $3 trillion.

C) more than $3 trillion.

D) either exactly $3 trillion or by less than $3 trillion, depending on whether the real wage rate remains constant or rises.

E) some amount but there is not enough information to tell by how much.

53) The table above gives a nation’s production function. Which of the following is NOT an attainable combination of real GDP and labor?

A) real GDP of $4.0 trillion and labor of 90 billion hours per year

B) real GDP of $4.7 trillion and labor of 110 billion hours per year

C) real GDP of $4.0 trillion and labor of 70 billion hours per year

D) real GDP of $5.2 trillion and labor of 90 billion hours per year

E) real GDP of $5.5 trillion and labor of 150 billion hours per year

54) In 2011, real GDP in the United States was $60 per hour worked. In major European economies, real GDP averaged on $48 per hour worked. This difference is explained by the points that ________ and ________.

A) Americans work more hours than Europeans; Americans produce more per hour than Europeans

B) Americans  are equally as productive as Europeans; Americans work more hours on average

C) Americans  work the same number of hours per week as Europeans on average; Americans are less productive due to technology differences

D) Americans take more vacations than Europeans; Americans take more sick days than Europeans

E) Americans work less hours than Europeans; Americans take less sick days than Europeans

55) The above figure shows a nation’s production function. Point A is

A) attainable if the economy is inefficient.

B) unattainable given the state of the economy.

C) attainable if the nation uses resources efficiently.

D) the maximum amount of real GDP the nation can produce.

E) the labor market equilibrium quantity of employment and real GDP.

56) The above figure shows a nation’s production function. Point B is

A) unattainable.

B) attainable if the nation uses resources inefficiently.

C) attainable if the nation uses resources efficiently.

D) the maximum amount of real GDP the nation can ever produce.

E) Both answers C and D are correct.

57) The above figure shows a nation’s production function. Point C is

A) unattainable given the nation’s resource level.

B) attainable if the nation uses resources efficiently.

C) attainable if the nation uses resources inefficiently.

D) the maximum amount of real GDP the nation can produce.

E) the labor market equilibrium point.

58) The above figure shows a nation’s production function. Point B is ________ and ________ because ________.

A) attainable; efficient; the nation is using resources efficiently

B) attainable; inefficient; the nation is using resources inefficiently

C) unattainable; inefficient; the nation is using resources inefficiently

D) unattainable; inefficient; the nation is using resources efficiently but they could be more efficient

E) unattainable; efficient; the nation would be using resources efficiently if they could attain this level of production

59) The above figure shows a nation’s production function. Point C is ________ and ________ because ________.

A) attainable; inefficient; the nation is using resources inefficiently

B) attainable; efficient; the nation is using resources efficiently

C) unattainable; inefficient; the nation is using resources inefficiently

D) unattainable; inefficient; the nation is using resources efficiently but they could be more efficient

E) unattainable; efficient; the nation would be using resources efficiently if they could attain this level of production

60) The above figure that most accurately shows a production function is

A) Figure A.

B) Figure B.

C) Figure C.

D) Figure D.

E) Both Figure A and Figure B; Figure A for an economy with an excess of labor and Figure B for an economy with a shortage of labor.