ECON 2120 Exam Updated Questions & Answers
QUESTIONS & ANSWERS
England 1750
When and Where did the industrial revolution begin?
Big differences in living standards
In the long run, small differences in economic growth rates result in?
A country that grows too slowly fails to raise living standards and in turn causes higher
rates of poverty, lower life expectancy, and higher infant mortality
The problems with slow economic growth?
Explains growth rates in real GDP per capita over the long run
economic growth model
1. the quantity of capital per hour worked
2. the level of technology
Two main factors that affect labor productivity?
quantity of goods and services that can be produced by 1 worker or one hour of work.
what is labor productivity?
positive or negative change in the ability of a form to produce a given level of output with a
given quantity of inputs
define technological change as defined by the economic growth model?
,1. Better machinery and equipment
2. Increases in human capital
3. Better means of organizing and managing production
What are the 3 main sources of technological change?
involves assembling goods from parts that arrive at the factory exactly when they are
needed
Define the just-in-time-system
The relationship between real GDP per hour worked and capital per hour worked, holding
level of technology constant
define the Per-worker production function
effective at increasing real GDP per capita
If a country is relatively lacking in capital, increases in capital will be_______?
More effective way to increases output per hour
In countries where the amount of capital is already relatively high, technological change
becomes a _______?
True
True or False? In the long-run, a country will experience an increasing standard of living only if
it experiences continuing technological change
Robert Solow in the 1950s
Who first developed the model of economic growth
, He considered technological change to be the result of scientific discoveries
Solow did not seek to explain technological exchange, instead_________?
A model of long-run economic growth that emphasizes that technological change is
influenced by economic incentives and is determined by the workings of the market system.
Define the New-Growth theory that was developed by paul romer
Is rival and excludable - a private good- and this results ni diminishing returns
Define physical capital
is nonrival and noexcluadble-a public good - and so results in increasing returns not at the
firm level but at the economy level
Define Knowledge Capital
benefitting from goods and services you do not pay for
EX: Bell's labs development of transistor technology resulted in immense profits for other
firms
what is free riding?
Protecting intellectual property with patents and copyrights
subsidizing research and development
subsidizing education
The public nature of knowledge capital leads to a role for government policy in?
Exclusive rights to produce a product for a period of 20 years from the date the patent
application is filed with the government
QUESTIONS & ANSWERS
England 1750
When and Where did the industrial revolution begin?
Big differences in living standards
In the long run, small differences in economic growth rates result in?
A country that grows too slowly fails to raise living standards and in turn causes higher
rates of poverty, lower life expectancy, and higher infant mortality
The problems with slow economic growth?
Explains growth rates in real GDP per capita over the long run
economic growth model
1. the quantity of capital per hour worked
2. the level of technology
Two main factors that affect labor productivity?
quantity of goods and services that can be produced by 1 worker or one hour of work.
what is labor productivity?
positive or negative change in the ability of a form to produce a given level of output with a
given quantity of inputs
define technological change as defined by the economic growth model?
,1. Better machinery and equipment
2. Increases in human capital
3. Better means of organizing and managing production
What are the 3 main sources of technological change?
involves assembling goods from parts that arrive at the factory exactly when they are
needed
Define the just-in-time-system
The relationship between real GDP per hour worked and capital per hour worked, holding
level of technology constant
define the Per-worker production function
effective at increasing real GDP per capita
If a country is relatively lacking in capital, increases in capital will be_______?
More effective way to increases output per hour
In countries where the amount of capital is already relatively high, technological change
becomes a _______?
True
True or False? In the long-run, a country will experience an increasing standard of living only if
it experiences continuing technological change
Robert Solow in the 1950s
Who first developed the model of economic growth
, He considered technological change to be the result of scientific discoveries
Solow did not seek to explain technological exchange, instead_________?
A model of long-run economic growth that emphasizes that technological change is
influenced by economic incentives and is determined by the workings of the market system.
Define the New-Growth theory that was developed by paul romer
Is rival and excludable - a private good- and this results ni diminishing returns
Define physical capital
is nonrival and noexcluadble-a public good - and so results in increasing returns not at the
firm level but at the economy level
Define Knowledge Capital
benefitting from goods and services you do not pay for
EX: Bell's labs development of transistor technology resulted in immense profits for other
firms
what is free riding?
Protecting intellectual property with patents and copyrights
subsidizing research and development
subsidizing education
The public nature of knowledge capital leads to a role for government policy in?
Exclusive rights to produce a product for a period of 20 years from the date the patent
application is filed with the government
