Foundations of Economics (8th Edition)
8th Edition
ISBN: 9780134486819
Author: Robin Bade, Michael Parkin
Publisher: PEARSON
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Chapter 25, Problem 6MCQ
To determine
To identify:
The option that correctly states about the classical growth theory.
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What is the outcome of classical growth theory?
According to classical growth theory,
A. discoveries bring profit, and competition destroys profit
B. capital does not experience diminishing returns
C. people make choices that determine the pace at which technological advances occur
D. no matter how technology advances, real wage rates are always pushed back toward the subsistence level
Why one nation experiences economic growth and another does not is a question that has intrigued economists since Adam Smith wrote An Inquiry into the Nature and Causes of the Wealth of Nations in 1776. Explain why each of the following would limit economic growth.a. The politically connected elite secure a large share of a country’s output and put the proceeds into foreign banks.having a small political elite that makes all the calls and decisions will lead to a small economic elite. b. The national philosophy is “Live for the moment and forget about tomorrow.”
c. The government closes all of the schools so more people will be available for work.d. The country fears military invasion and spends half of its income on military goo
Calculate real growth per capita in the following countries:Instructions: Round your answers to 1 decimal place. If you are entering a negative number be sure to include a negative sign (-) in front of the number.a. Democratic Republic of Congo: population growth = 2.7 percent; real output growth = - 1.5 percent. %. b. Estonia: population growth = - 0.5 percent; real output growth = 4.4 percent. %. c. India: population growth = 2.2 percent; real output growth = 6.3 percent. %. d. United States: population growth = 0.6 percent; real output growth = 2.7 percent. %.
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Chapter 25 Solutions
Foundations of Economics (8th Edition)
Ch. 25 - Prob. 1SPPACh. 25 - Prob. 2SPPACh. 25 - Prob. 3SPPACh. 25 - Prob. 4SPPACh. 25 - Prob. 5SPPACh. 25 - Prob. 6SPPACh. 25 - Prob. 7SPPACh. 25 - Prob. 8SPPACh. 25 - Prob. 9SPPACh. 25 - Prob. 10SPPA
Ch. 25 - Prob. 11SPPACh. 25 - Prob. 12SPPACh. 25 - Prob. 1IAPACh. 25 - Prob. 2IAPACh. 25 - Prob. 3IAPACh. 25 - Prob. 4IAPACh. 25 - Prob. 5IAPACh. 25 - Prob. 6IAPACh. 25 - Prob. 7IAPACh. 25 - Prob. 8IAPACh. 25 - Prob. 9IAPACh. 25 - Prob. 10IAPACh. 25 - Prob. 1MCQCh. 25 - Prob. 2MCQCh. 25 - Prob. 3MCQCh. 25 - Prob. 4MCQCh. 25 - Prob. 5MCQCh. 25 - Prob. 6MCQCh. 25 - Prob. 7MCQCh. 25 - Prob. 8MCQ
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- How does an increase in human capital affect economic growth? Put the following steps in sequence. Drag and drop options into correct order and submit. For keyboard navigation. SHOW MORE V = The workforce can produce a greater real GDP. There is a greater amount of capital that workers can use. This causes real GDP per worker to increase. Each worker can increase the number of goods and services produced. With enhanced skills each worker can produce more than before. Workers increase their education and skills. IIarrow_forwardWhat are the advantages of backwardness for economic growth?arrow_forwardChoose the correct statement about economic growth theories. A. Modern-day Malthusians point to global warming and climate change as reasons to believe that eventually real GDP per person will decrease. B. Classical growth theory tells us profit is the spur to technological change. C. According to new growth theory, growth occurs because knowledge and physical capital do not experience diminishing returns. D. New growth theory is sometimes called Malthusian theory.arrow_forward
- _____ shows roughly how long it will take a nation to double its output at various growth rates. A. The GDP deflator B. The rules of the game C. The production possibilities curve D. A per-worker production function E. The Rule of 70arrow_forwardWhich of the following statements best describes the relationship between Economic Growth and Literacy Rates ? A. Literacy Rates decline as Economic Growth improves because Education is less useful in a developed economy. B. Increased Literacy initially stimulates Economic Growth by improving Labour Productivity but declines as the Opportunity Cost of Education increases with long-term Economic Growth. C. Increased Literacy stimulates Economic Growth by increasing Labour Productivity; People consume more Education as the Economy continues to grow. D. There is no correlation between Economic Growth and Literacy Rates.arrow_forwardThe following are the main factors that drive economic growth except: A. Agrarian Reform B. Accumulation of capital stock C. Increases in labor inputs, such as workers or hours worked D. Technological advancementarrow_forward
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