Multiple Choice Questions
1. Over the past century, real GDP per person in the United States has grown about ________ percent per year, which means it doubles about every ________ years.
a. 2, 14
b. 2, 35
c. 5, 14
d. 5, 35
2. The world's rich countries, such as Japan and Germany, have income per person that is about
________ times the income per person in the world's poor countries, such as Pakistan and India.
a. 3
b. 6
c. 12
d. 36
3. Most economists are ________ that natural resources will eventually limit economic growth. As evidence, they note that the prices of most natural resources, adjusted for overall inflation, have tended to ______________________ over time.
a. Concerned, rise
b. Concerned, fall
c. Not concerned, rise
d. Not concerned, fall
4. Because capital is subject to diminishing returns, higher saving and investment does not lead to higher
a. Income in the long run.
b. Income in the short run.
c. Growth in the long run.
d. Growth in the short run.
5. When the Japanese car maker Toyota expands one of its car factories in the United States, what is the likely impact of this event on the GDP and GNP of the United States?
a. GDP rises and GNP falls.
b. GNP rises and GDP falls.
c. GDP shows a larger increase than GNP.
d. GNP shows a larger increase than GDP.
6. Thomas Robert Malthus believed that population growth would
a. Put stress on the economy's ability to produce food, dooming humans to remain in poverty.
b. Spread the capital stock too thinly across the labor force, lowering each worker's productivity.
c. Promote technological progress, because there would be more scientists and inventors.
d. Eventually decline to sustainable levels, as birth control improved and people had smaller families