Long Term Economic Growth Mcqs - Set 1

1)   Real business cycle theories suggest that _____ to correct departures from the desired growth path?

a. There is a role for fiscal policy
b. There is a role for monetary policy
c. There is a role for supply-side policy
d. There is a role for stabilizing output ever the business cycle
Answer  Explanation 

ANSWER: There is a role for stabilizing output ever the business cycle

Explanation:
No explanation is available for this question!


2)   The impossibility of negative gross investment provides a ______ to fluctuation in ______?

a. ceiling, stock building
b. ceiling, capital prices
c. floor, output
d. floor, the capital-output ratio
Answer  Explanation 

ANSWER: floor, output

Explanation:
No explanation is available for this question!


3)   The multiplier accelerator model assumes ____ depends on ______?

a. consumption expected future profits
b. investment, interest rates
c. investment expected future profits
d. stock building interest rates
Answer  Explanation 

ANSWER: investment expected future profits

Explanation:
No explanation is available for this question!


4)   All of the following are parts of the business cycle except ?

a. boom
b. slump
c. recovery
d. acceleration
Answer  Explanation 

ANSWER: acceleration

Explanation:
No explanation is available for this question!


5)   The business cycle describes fluctuations in output around the?

a. trend path of output
b. boom
c. recession
d. short-run fluctuations in output
Answer  Explanation 

ANSWER: trend path of output

Explanation:
No explanation is available for this question!


6)   The neoclassical theory of growth identifier the steady state rate of growth as the ____ just sufficient to keep _____ constant while labor grows?

a. saving, investment
b. capital per person, productivity
c. labor growth, output
d. investment capital per person
Answer  Explanation 

ANSWER: investment capital per person

Explanation:
No explanation is available for this question!


7)   GDP per head may be an imperfect measure of economic welfare because it excludes ?

a. the value of leisure
b. Externalities
c. Untraded goods
d. Change in the distribution of income
e. All of the above
Answer  Explanation 

ANSWER: All of the above

Explanation:
No explanation is available for this question!


8)   Governments can stimulate productivity by ?

a. Imposing higher taxes on capital
b. encouraging more labour intensive work to reduce unemployment
c. reducing spending in education
d. encouraging private investment
Answer  Explanation 

ANSWER: encouraging private investment

Explanation:
No explanation is available for this question!


9)   A combined measure of productivity that takes account of both labor and capital productivity is known as ?

a. total exploitation
b. labour/capital productivity
c. total factor productivity
d. total productivity
Answer  Explanation 

ANSWER: total factor productivity

Explanation:
No explanation is available for this question!


10)   The belief that the rate of growth depends upon technological progress facilitated by institutions incentives and government is known as ________ growth theory?

a. endogenous
b. exogenous
c. beta
d. convergence
Answer  Explanation 

ANSWER: endogenous

Explanation:
No explanation is available for this question!