Question 6 Which of the following examples represents convergence? O Lower income countries are growing at a higher rate than higher income countries and catching up. O The political systems of lower income countries evolve to become like higher income countries over time. O The technology available in low income countries improves to match that of higher income countries. O Higher income countries are growing at a faster rate than middle income countries because of more advanced technology.

Question 6 Which of the following examples represents convergence? O Lower income countries are growing at a higher rate than higher income countries and catching up. O The political systems of lower income countries evolve to become like higher income countries over time. O The technology available in low income countries improves to match that of higher income countries. O Higher income countries are growing at a faster rate than middle income countries because of more advanced technology.

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter20: Economic Growth In The Global Economy

Section: Chapter Questions

Problem 4P

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The following table shows the GDP per capita of various countries forthe years 1960 and 2010 in PPP-adjusted 2005 dollars. The table alsocontains the implied growth rates, which show how much on average eachcountry needed to grow each year to reach the 2010 level of GDP per capitastarting from the 1960 level of GDP per capita. Use the table to answer thefollowing questions. 1. During 1960-2010, which countries failed to reduce the gap betweentheir GDP per capita and the U.S. GDP per capita?
The following table shows the GDP per capita of various countries forthe years 1960 and 2010 in PPP-adjusted 2005 dollars. The table alsocontains the implied growth rates, which show how much on average eachcountry needed to grow each year to reach the 2010 level of GDP per capitastarting from the 1960 level of GDP per capita. Use the table to answer thefollowing questions. 1. Why have some countries reduced the gap between their incomes andthat of the United States and other countries failed to do so?
The following table shows the GDP per capita of various countries forthe years 1960 and 2010 in PPP-adjusted 2005 dollars. The table alsocontains the implied growth rates, which show how much on average eachcountry needed to grow each year to reach the 2010 level of GDP per capitastarting from the 1960 level of GDP per capita. Use the table to answer thefollowing questions. 1. During 1960-2010, which countries were able to reduce the gap betweentheir GDP per capita and the U.S. GDP per capita?
15. Low - income countries and upper middle - income countries are informally grouped as the middle - income countries. O. True O. False 16. The PPP gives an overall index of economic development. It gives a rough ability to make comparisons on the issue of economic welfare - much more than just using GDP statistics. PPP is important because it helps us to know how a country is doing. It is a better measure of a country's progress. O. True O. False 17. Health as measured by life expectancy, undernourishment, and literacy. O. True O. False 18. Gross domestic product is defined as gross domestic product, plus net receipts from abroad of compensation of employees, property income and net taxes less subsidies on production. O. True O. False
Which of the following is true about classifying countries as low income, middle income, or high income? O There is no criteria for classifying economies as low income, middle income, or high income O Countries with unemployment rates above 5% are classified as low income Low income countries have $1,025 per capita GDP per year or lower O High income countries have $15,625 GDP per capita GDP per year or higher
15. Suppese that in 1960 Japan had an initial per capita GDP of $12.000 per year and China had a per capita GOP of 55.000. But China is grewing at 5 percent per year and iapan is growing at 3 percent per year. ia richer in 2010 with a per capita GDP of eporoni mately a lapan $5.000 a. China: $73,500 a. lapen: $31,500 . Not enough information is given. e China $5,000
120 100F NOR ARE SGP CHE HKG SWE TWN Na. A VEN 40 60 80 100 120 Relatiwe GDP per enpita to the US lewel - 1970 In the figure above, GDP per capita relative to the US level for a large group of countries is plotted for years 1970 (in the horizontal axis) and 2000 (in the vertical axis). Which one of the following statements is correct? O Income per capita of countries on the 45 degree line has grown at a similar rate than income per capita of the US in each year. O Income per capita of each country is plotted according to how strongly it correlates to the income per capita of the US in each year. O The income per capita of those countries below the 45 degree line has grown the fastest in between years 1970 and 20 O The income per capita of those countries on the 45 degree line has not grown in between years 1970 and 2000.
Which government policy promotes economic growth? O A. increasing the interest rate charged on student loans B. implementing a fiscal policy that increases inflation C. implementing a monetary policy that increases inflation O D. building infrastructure and providing public goods Reset Selection
The hockey stick of growth shows us O That environmental damage has increased dramatically in the past century That GDP per capita has increased dramatically in the past century O That wealth per capita has increased dramatically in the past century O That inflation per capita has increased dramatically in the past century
Select one or more: O a. If Country C's GDP per capita rises from $2,500 to 7,500, and Country D's GDP per capita rises from $6,000 to 18,000, the ratio of GDP per capita between the two countries is unchanged. O b. If a country's GDP doubles every 50 years on a ratio scale graph against time it will rise at an increasing rate. O c. Country B is growing a higher percentage rate than Country A, but Country A is 5 times richer than Country B. On a linear scale graph against time the gap between the two lines must be narrowing. O d. Country E is growing at the same percentage rate as Country F, but Country E is 3 times richer than Country F. On a log scale graph against time the gap between the two lines will be constant.
Why does higher worker productivity not necessarily mean GDP per capita will rise? GDP per Capita depends on income, and not on worker productivity. O Workers might choose more leisure time instead of work, keeping total production the same but reducing hours worked. O Higher productivity does not necessarily translate to higher output, since employers may not give salary increases. O Workers might be more productive, but that doesn't mean GDP per Capita will go up unless they work more hours.
A country faces diminishing marginal returns when increasing it's capital stock. If this country added 1,000 units of capital last year and saw their GDP rise by $500 per person, what would you expect to happen if they had added 2,000 units of capital instead? O GDP would increase by another $500 per person O GDP would increase by less than another $500 per person O GDP would increase by more than another $500 per person O It is impossible to tell what would happen What is a potential downside of using patents to promote the creation of new technology? Without a market test, patents might be given to technology which ends up being useless. O Government money may be directed towards unproductive goals. It slows the spread and development of those ideas by restricting competition. They prohibit competition forever. What is the law of diminishing marginal returns?