Growth Flashcards
If output grows faster than the population, the average standard of living will
Rise
Gross Domestic Product (GDP) per capita is
GDP per person
Economic growth is defined as a long-run increase in an economy’s
Total Output of goods and services
Rich countries (measured by GDP per capita) tend to have __________ infant mortality rates, __________ life expectancies at birth, and __________ adult literacy rates than poor countries.
Lower; higher; higher
The three most important sources of economic growth are
increases in employment, increases in the capital stock, and improvements in technology
The employment-population ratio is
percentage of the population employed
Which of the following mathematical statements is correct
Total Output= Productivity x Average Hours x the employment-population ration x population
An increasing percentage of women are in the work force. Which variable does this directly affect?
The employment-population ration (EPR)
Economist who focus on long-run growth suggest that the government could lower taxes on labor income in order to increase employment
True
The reform of the welfare system passed by Congress and signed by President Clinton changed the benefits for welfare recipients as it
Decreased the number of people eligible for benefits, cut the benefit amount for those still eligible, and set a maximum coverage period of five years.
An increase in the capital stock causes labor productivity to
Increase and the standard of living to increase
If the capital stock increases faster than employment, then we would expect
both output and labor productivity to rise
Government budget deficits
discourage planned investment spending by putting upward pressure on interest rates
Human capital is defined as
the skills and knowledge possessed by workers
An increase in the stock of human capital would
cause the economy to move along a given per worker production function, increasing both productivity and living standards
