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Chapter 3 : Economic Growth: Concepts and Patterns
MULTIPLE CHOICE
1. Countries with slow growth include all of the following EXCEPT:
a.
Madagascar.
c.
Kenya.
b.
Nigeria.
d.
Venezuela.
2. Countries with rapid growth include all of the following EXCEPT:
a.
Indonesia.
c.
Botswana.
b.
South Korea.
d.
Chile.
3. Which of the following is NOT much of a problem in Botswana?
a.
unemployment
c.
inequality
b.
HIV/AIDS
d.
corruption
4. Economists think that economic growth depends fundamentally on all of the following EXCEPT:
a.
factor accumulation.
c.
efficiency.
b.
inequality.
d.
technological change.
5. In the Solow model, investment comes from:
a.
outside lenders.
c.
saving.
b.
the government.
d.
the capital stock.
6. Diminishing returns to capital means that as you add more capital:
a.
output falls.
b.
the additional contribution to output eventually declines.
c.
labor usage falls.
d.
output rises.
7. A country’s labor force grows 1.2 percent and its capital stock grows 3 percent. Assume that labor
share of output is 0.25. If the economy grows 4.55 percent, how much does total factor productivity
grow?
a.
0.5 percent
c.
1.5 percent
b.
1 percent
d.
2 percent
8. Economists Barry Bosworth and Susan Collins found that capital accumulation accounted for about
two-thirds of total growth in:
a.
South America.
c.
East Asia.
b.
sub-Saharan Africa.
d.
Eastern Europe.
9. Since 1980, GDP per capita has grown more than sevenfold in:
a.
India.
c.
Egypt.
b.
China.
d.
Uruguay.
10. Economist Stephen Radelet has demonstrated that, by stabilizing economic and political problems in
the mid-1990s, 17 sub-Saharan African countries experienced an annual average total factor
productivity growth rate of:
a.
0.25 percent.
c.
2.75 percent.
b.
1.5 percent.
d.
7.75 percent.
11. While Robert Solow established the model for the study of modern economic development, this
economist’s research in the early 1990s had set the contemporary stage for explaining the variance in
growth across countries:
a.
Milton Friedman.
c.
Ayn Rand.
b.
Walter Williams.
d.
Robert Barro.
12. Between 1990–2002, this nation’s growth and development performance was the worst in the world at
–7.2 percent:
a.
Democratic Republic of the Congo.
c.
Argentina.
b.
Mexico.
d.
Benin.
13. Malaysia’s growing life expectancy over the past generation can be largely attributed to:
a.
new hybrid crops.
b.
a serious reduction in the incidence of malaria.
c.
the widespread production and consumption of organic foods.
d.
the eradication of tuberculosis.
14. In order for sustained economic growth to be successful, the centerpiece to the growth process in most
countries must be its:
a.
agricultural policies.
c.
industrial production methods.
b.
export policies.
d.
military strength.
15. The empirical relationship between trade and growth is:
a.
strong.
b.
weak.
c.
strong for natural resource-based exports only.
d.
nonexistent.
16. Being landlocked means that:
a.
growth is impossible.
b.
there will be great challenges in the development of external trade.
c.
foreign aid is needed.
d.
new advances in technology are not beneficial.
MSC: Factual
SHORT ANSWER
IDs and Paired-Concept Questions
These terms can be used individually as short-answer identification questions, or they can be used in
pairs. In the latter case, ask students to explain (1) the meaning and significance of each of the two
terms and (2) the relationship between them.
1. Thailand, Zambia
ANS:
Answer will vary
2. Botswana, natural resources
ANS:
Answer will vary
3. Factor accumulation, productivity growth
ANS:
Answer will vary
4. Saving, Solow model
ANS:
Answer will vary
5. Total factor productivity (TFP), growth accounting
ANS:
Answer will vary
6. Institutions, growth
ANS:
Answer will vary
7. Geography, growth
ANS:
Answer will vary
8. China, India
ANS:
Answer will vary
9. Tropics, HIV/AIDS
ANS:
Answer will vary
10. Bostwana and Uganda, Chad and Niger
ANS:
Answer will vary
