MARK BRADY- -Quiz TWO PAGE 3 17. Now assume that Amy has gotten better at picking apples so that in an hour she can pick either three baskets of apples or three baskets of grapes. And assume that Bob has gotten better at both activities so that in an hour he can either pick either two baskets of apples or two baskets of grapes. Here are three statements, each of which may be true or false. Identify the correct statement(s). I Amy and Bob will continue to specialize and trade to mutual advantage. II Amy is better off than she was before. III Bob is better off than he was before. Choose the correct option below. A I and II are true, III is false. B I and III are true, II is false. II and III are true, I is false. All three are true. QUESTIONS 18-19 test your understanding of real versus nominal values. Assume that real GDP is INCREASING. 18. If the price level is rising, nominal GDP would increase A faster than real GDP B slower than real GDP 19. If the price level is falling, real GDP would increase A faster than nominal GDP B slower than nominal GDP QUESTIONS 20-23 test your understanding of economic growth. 20. Economic growth that occurs as the labor force expands but there is no organizational change, and the stock of capital per worker does not grow and technological innovation does not occur, and consequently there is no increase in output per worker, and, ceteris paribus, no increase in output per person, is known as A extensive growth B intensive growth 21. Economic growth in output per person, is known as A extensive growth B intensive growth 22. Economic growth that occurs as a result of organizational change-like the development of markets and monetization leading to increased specialization and division of labor-is known as A Promethean growth B Smithian growth 23. Economic growth that occurs as a result of a growth in the stock of capital per worker likely accompanied by technological innovation, is known as A Promethean growth B Smithian growth