Question :
3.3 Economic Growth
1) Which of the following the best definition : 1228135
3.3 Economic Growth
1) Which of the following is the best definition of economic growth?
A) The investment in capital and consumption goods by an economy.
B) The opportunity cost of capital.
C) The opportunity cost of consumption.
D) Increased development of land and entrepreneurship.
E) The sustained expansion of production possibilities.
2) The sustained expansion of production possibilities is called
A) economic investment.
B) production expansion.
C) opportunity cost of growth.
D) economic growth.
E) production possibilities.
3) Consider a PPF with consumption goods on the horizontal axis and capital goods on the vertical axis. If the country operates on its PPF near its ____________ axis, this country __________.
A) vertical; will experience greater economic growth
B) vertical; will not face opportunity costs
C) horizontal; will have a larger chance at economic growth
D) horizontal; faces larger trade offs
E) vertical; is operating at an inefficient point
4) Economic growth depends upon which of the following?
i.Increasing the quantity of labor
ii.Lowering the prices of goods and services
iii.Advancing technology
A) i only
B) ii only
C) iii only
D) i and iii
E) i, ii, and iii
5) Economic growth depends upon which of the following?
i.Improving the quality of labor
ii.Technological advancement
iii.Increasing the amount of capital
A) i only
B) ii only
C) iii only
D) i and iii
E) i, ii, and iii
6) As an economy grows,
A) its PPF shifts outward.
B) it can eliminate scarcity.
C) the opportunity cost of production will approach 0.
D) the opportunity cost of production will increase.
E) its PPF does not shift; instead, the production point moves from inside the PPF to be closer to the PPF.
7) The opportunity cost of economic growth is
A) 0, because it means an expansion of production possibilities.
B) the decrease in the current production of productive factors.
C) a slower accumulation of human capital.
D) the decrease in the current production of consumption goods.
E) the increase in the nation’s capital stock and/or its technology.
8) What is the opportunity cost of economic growth?
A) Current period consumption goods
B) Current period capital goods
C) Land
D) Both current period consumption and capital goods
E) Both current period capital goods and land
9) The above figure shows the PPF for a country that produces computers and computer factories. Which of the following would most likely shift the PPF from PPF0 in one year to PPF1 in the next?
A) Nothing, because the PPF does not shift.
B) Increase the production of computers from 9 million (at point C) to 11 million (at point B).
C) Decrease the production of computers from 11 million (at point B) to 9 million (at point C) and build 9 new computer factories.
D) Increase consumption of both computers and computer factories.
E) Decrease production of both computers and computer factories by moving into the interior of the PPF.
10) The above figure shows the PPF for a country that produces computers and computer factories. The nation’s production possibilities frontier is PPF0 . At which of the following production points would the economy grow most rapidly?
A) Point A
B) Point B
C) Point C
D) It makes no difference among the three points because they are all production efficient.
E) More information is needed to answer the question.
