Ch 12 Production and Growth

Question 1

What is the amount of goods and services produced for each hour of a worker’s time?

Answer 1

Productivity

Question 2

why do living standards vary so much around the world?

Answer 2

productivity

Question 3

Because of tremendous technological advances, the average American today is arguably “richer” than the richest American a century ago

Answer 3

.

Question 4

These are the determinants of productivity

Answer 4

physical capital, human capital, natural resources, and technological knowledge

Question 5

This refers to the stock of equipment and structures used to produce goods and services

Answer 5

physical capital or just capital

Question 6

The economist’s term for the knowledge and skills that workers acquire through education, training, and experience.

Answer 6

Human capital

Question 7

inputs into production that are provided by nature such as land, rivers, and mineral deposits.

Answer 7

Natural Resources.

US - large supply of land well driven for agriculture

Kuwait and Saudi arabia - oil

but japan is still productive even with little natural resources.

Question 8

the understanding of the best ways to produce goods and services

Answer 8

technological knowledge

Question 9

Are Natural resources a limit to growth?

Answer 9

Not necessarily. Technological progress often yields ways to avoid these limits. Modern cars have better gas mileage. New houses have better insulation and require less energy to heat and cool. More efficient oil rigs waste less oil in the process of extraction. Recycling + the use of other nonrenewable resources.

Also price of natural resources are stable in the long run.

Question 10

Ways to raise future productivity

Answer 10

1) Saving to invest more resources in the production of capital

Question 11

catch-up effect

Answer 11

the property whereby countries that start off poor tend to grow more rapidly than countries that start off rich

Question 12

A capital investment that is owned and operated by a foreign entity is called _____ ______ _____

Answer 12

foreign direct investment

Question 13

An investment that is financed with foreign money but operated by domestic residents is called

Answer 13

foreign portfolio investment

Question 14

who argued that an ever-increasing population would continually strain society’s ability to provide for itself. As a result, mankind was doomed to forever live in poverty?

Answer 14

Thomas Malthus