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Homework answers / question archive / 39878 Prog (bountiful Hs) - ECON 101 1
39878 Prog (bountiful Hs) - ECON 101
1. If the rate of unemployment is neither rising nor falling, then the number of people finding jobs must equal the number of people
2. If the rate of job finding rises, the natural rate of unemployment will
3. Suppose that 2 percent of the employed lose their jobs each month (s = 0.02) and 38 percent of the unemployed find a job each month
(f = 0.38). Then, the steady-state rate of unemployment is
4. The unemployment rate is 10 percent. The rate of job separation is 5 percent. How high does the rate of job finding have to be to keep the unemployment rate constant?
5. Unemployment insurance schemes mainly increase
6. The unemployment caused by the time that it takes to match workers and jobs is called
7. Frictional unemployment occurs because
8. Which of the following policies would reduce the amount of frictional unemployment?
9. If the government increases the amount of unemployment insurance that unemployed workers can collect, the amount of frictional unemployment would be expected to
10. When the real wage is above the level that equilibrates supply and demand, then the quantity of labor supplied
11. The unemployment resulting from wage rigidity and job rationing is called
12. A teenager is not able to find a job because the legal minimum wage is higher than the wage that firms are willing to offer.
This situation is an example of
13. Minimum-wage laws are an example of
14. Wait unemployment results when
15. Which of the following is not a cause for real wage rigidity?
16. The unemployment caused by unions and by the threat of unionization is an instance of
17. Unions may cause unemployment if
18. Efficiency wage theories claim that firms may pay high real wages in order to
19. Efficiency wages do not lead to
20. Which of the following statements about unemployment is true?
21. Compared to long-term unemployment, short-term unemployment is more likely to be
22. Suppose that 130 people are unemployed for part of a given year; 120 are unemployed for 1 month, 10 are unemployed throughout the year; what percentage of total months of unemployment is attributable to the long-term unemployed?
23. Measured unemployment may be lower than actual unemployment because
24. Discouraged workers who want jobs, but have stopped looking for jobs are
25 Many economists believe that the rise in European unemployment is caused by
1. The Solow growth model assumes that the production function exhibits
2. Which of the following is not assumed by the Solow growth model?
3. In the Solow model, the depreciation rate represents the
4. The change in the capital stock is equal to
5. Suppose that the capital stock is 100, the depreciation rate is 10 percent per year, and output is 25. What must the saving rate be to keep the capital stock constant?
6 If the capital stock is above the steady-state level, then investment
7. If an economy is initially in a steady state and it experiences an increase in its saving rate, then the steady-state capital stock will
8 Suppose that output per worker is 10, the production function is y = sqrt(k) [that is, output per worker is equal to the square root of capital per worker] and the total capital stock is 1,000. How large is the labor force?
9 Suppose that the production function is y = sqrt(k) [that is, output per worker is equal to the square root of capital per worker], s = 0.40, and delta [the depreciation rate] = 0.10. What is the steady-state level of capital?
10 Suppose that the production function is y = sqrt(k) [that is, output per worker is equal to the square root of capital per worker], s = 0.40, and delta [the depreciation rate] = 0.10. What level saving will lead to the highest possible level of output in the steady state?
11 A war has wrecked the economy of Baloneya: both the capital stock and the work force have been reduced by 50 percent. If the economy's production function has constant returns to scale, how will the postwar level of output per worker compare to the prewar level?
12 In the steady state of the Solow growth model, the saving rate does not determine
13 The Golden Rule level of capital accumulation is defined as the level of the capital stock that achieves a steady state with the
14 At the Golden Rule level of capital accumulation, the marginal product of capital equals the
15 Suppose that an economy is in steady state and has more capital than it would have in the Golden Rule steady state. A policymaker would want to pursue policies aimed at decreasing
16 An economy starts off in a steady state with less capital than at the Golden Rule level. Now the saving rate changes to the level that will achieve the Golden Rule. What is the path of consumption during the transition to the Golden Rule steady state?
17 An economy is in a steady state with capital higher than the Golden Rule level. Now the saving rate falls to a level that will achieve the Golden Rule capital stock in the long run. What will happen to the level of consumption between the initial and new steady states?
18 If two economies are identical except for their rates of population growth, then the economy with the higher rate of population growth will have
19 If two economies are identical except for their rates of population growth, then if both economies are in steady state, the economy with the higher rate of population growth will have a
20 In the Solow growth model with population growth (n) and technological progress (g), the steady-state growth rate of output per efficiency unit is
21 In the Solow growth model with population growth (n) and technological progress (g), the steady-state growth rate of output per worker is
22 In the Solow growth model with population growth (n) and technological progress (g), the steady-state growth rate of total output is
23 A permanent change in the growth rate of total output can arise from a change in the
24 The marginal product of capital (MPK) is 1/3; the marginal product of labor (MPL) is 3. Capital is increased by 30; the labor force is increased by 10. How much does output increase?
25 Suppose that the production function is Y = AF(K,L). The (unchanging) share of capital in output is 0.5. Suppose that output increases by 4 percent, the labor force increases by 3 percent, and the capital stock increases by 2 percent. What is the Solow residual in this case?
1. In the Solow growth model with population growth (n) and technological progress (g), the steady-state growth rate of output per efficiency unit is
2. In the Solow growth model with population growth (n) and technological progress (g), the steady-state growth rate of output per worker is
3. In the Solow growth model with population growth (n) and technological Progress (g), the steady-state growth rate of total output is
4. A permanent change in the growth rate of total output can arise from a change in the
5. In the Solow growth model with population growth and technological progress, the economy
experiences a 5 percent "labor-augmenting technological progress" if:
6. In the Solow growth model with population growth of 5 percent and a labor augmenting technological progress of 3 percent, the economy's:
7. In the Solow model with technological progress, an increase in the rate of technological change will:
8. In a Solow model with population growth and technological progress, the steady state level of consumption is maximized when the steady state marginal product of capital equals the rate of depreciation plus
9. In the Solow growth model, the steady state level of income per person in a country is a function of all the following EXCEPT:
10. Using the framework of the Solow growth model, the U.S. level of capital is presently
11. All of the following are possible explanations for the worldwide slowdown in economic growth during the 70'sand 80's EXCEPT
12. In the basic endogenous growth model, the production function exhibits
13. In the basic endogenous growth model, usually called the Y=AK model, as long as the savings rate times the constant A is greater the rate of depreciation, income will grow
14. In the Solow model, savings leads to _______ growth, but in the Y=AK model, savings can lead to _______ growth.
15. Advocates of the Y=AK model interpret capital as
16. In the two sector model presented in Section 8-4, where the sectors consist of manufacturing firms andresearch universities,
17. In the two sector model, the proportion of labor devoted to research universities determines the
18. In most endogenous growth theories, externalities from firms' research play a crucial role. Economists agreethat research
19. The marginal product of capital (MPK) is 1/3; the marginal product of labor (MPL) is 3. Capital is increased by30; the labor force is increased by 10. How much does output increase?
20. Suppose that the production function is Y = AF(K,L). The (unchanging) share of capital in output is 0.5. Suppose that output increases by 4 percent, the labor force increases by 3 percent, and the capital stock increases by 2percent. What is the Solow residual in this case?
21. Real-business-cycle theorists believe that fluctuations in output and employment are:
22. In a recession, firms may keep workers they do not need, so they will have these workers when the recession is over. This is called:
23. Which of the following is NOT an explanation for variations in the Solow residual?
1. If the rate of unemployment is neither rising nor falling, then the number of people finding jobs must equal the number of people
answer. losing or leaving jobs.
2. If the rate of job finding rises, the natural rate of unemployment will
answer. decrease.
3. Suppose that 2 percent of the employed lose their jobs each month (s = 0.02) and 38 percent of the unemployed find a job each month
(f = 0.38). Then, the steady-state rate of unemployment is
answer. 5 percent.
4. The unemployment rate is 10 percent. The rate of job separation is 5 percent. How high does the rate of job finding have to be to keep the unemployment rate constant?
answer. 45 percent
5. Unemployment insurance schemes mainly increase
answer. frictional unemployment.
6. The unemployment caused by the time that it takes to match workers and jobs is called
answer. frictional unemployment.
7. Frictional unemployment occurs because
answer. it takes time to match firms and workers.
8. Which of the following policies would reduce the amount of frictional unemployment?
answer. public retraining programs
9. If the government increases the amount of unemployment insurance that unemployed workers can collect, the amount of frictional unemployment would be expected to
answer. rise.
10. When the real wage is above the level that equilibrates supply and demand, then the quantity of labor supplied
answer. is greater than the quantity of labor demanded.
11. The unemployment resulting from wage rigidity and job rationing is called
answer. wait unemployment.
12. A teenager is not able to find a job because the legal minimum wage is higher than the wage that firms are willing to offer.
This situation is an example of
answer. wait unemployment.
13. Minimum-wage laws are an example of
answer. wage rigidity.
14. Wait unemployment results when
answer. the real wage is above its market-clearing level.
15. Which of the following is not a cause for real wage rigidity?
answer. unemployment insurance
16. The unemployment caused by unions and by the threat of unionization is an instance of
answer. conflict between insiders and outsiders.
17. Unions may cause unemployment if
answer. insiders force real wages higher than the market-clearing
level.
18. Efficiency wage theories claim that firms may pay high real wages in order to
answer. make workers more productive.
19. Efficiency wages do not lead to
answer. lower firm profits.
20. Which of the following statements about unemployment is true?
answer. Most unemployment is accounted for the by long-term
unemployed.
21. Compared to long-term unemployment, short-term unemployment is more likely to be
answer. frictional unemployment.
22. Suppose that 130 people are unemployed for part of a given year; 120 are unemployed for 1 month, 10 are unemployed throughout the year; what percentage of total months of unemployment is attributable to the long-term unemployed?
answer. 50 percent
23. Measured unemployment may be lower than actual unemployment because
answer. some individuals may want a job but have become
discouraged and stopped looking for one.
24. Discouraged workers who want jobs, but have stopped looking for jobs are
answer. no longer in the labor force.
25 Many economists believe that the rise in European unemployment is caused by
answer. generous government benefits.
1. The Solow growth model assumes that the production function exhibits
answer. constant returns to scale.
2. Which of the following is not assumed by the Solow growth model?
answer. Output is constant.
3. In the Solow model, the depreciation rate represents the
answer. fraction of the capital stock that wears out each year.
4. The change in the capital stock is equal to
answer. investment - depreciation.
5. Suppose that the capital stock is 100, the depreciation rate is 10 percent per year, and output is 25. What must the saving rate be to keep the capital stock constant?
answer. 40 percent
6 If the capital stock is above the steady-state level, then investment
answer. is smaller than depreciation.
7. If an economy is initially in a steady state and it experiences an increase in its saving rate, then the steady-state capital stock will
answer. rise.
8 Suppose that output per worker is 10, the production function is y = sqrt(k) [that is, output per worker is equal to the square root of capital per worker] and the total capital stock is 1,000. How large is the labor force?
answer. 10
9 Suppose that the production function is y = sqrt(k) [that is, output per worker is equal to the square root of capital per worker], s = 0.40, and delta [the depreciation rate] = 0.10. What is the steady-state level of capital?
answer. 16
10 Suppose that the production function is y = sqrt(k) [that is, output per worker is equal to the square root of capital per worker], s = 0.40, and delta [the depreciation rate] = 0.10. What level saving will lead to the highest possible level of output in the steady state?
answer. 100 percent
11 A war has wrecked the economy of Baloneya: both the capital stock and the work force have been reduced by 50 percent. If the economy's production function has constant returns to scale, how will the postwar level of output per worker compare to the prewar level?
answer. It will be the same.
12 In the steady state of the Solow growth model, the saving rate does not determine
answer. the growth rate.
13 The Golden Rule level of capital accumulation is defined as the level of the capital stock that achieves a steady state with the
answer. highest level of consumption.
14 At the Golden Rule level of capital accumulation, the marginal product of capital equals the
answer. depreciation rate.
15 Suppose that an economy is in steady state and has more capital than it would have in the Golden Rule steady state. A policymaker would want to pursue policies aimed at decreasing
answer. the rate of saving.
16 An economy starts off in a steady state with less capital than at the Golden Rule level. Now the saving rate changes to the level that will achieve the Golden Rule. What is the path of consumption during the transition to the Golden Rule steady state?
answer. It is lower, then higher than in the initial steady state.
17 An economy is in a steady state with capital higher than the Golden Rule level. Now the saving rate falls to a level that will achieve the Golden Rule capital stock in the long run. What will happen to the level of consumption between the initial and new steady states?
answer. It will rise instantly and then will fall gradually.
18 If two economies are identical except for their rates of population growth, then the economy with the higher rate of population growth will have
answer. lower steady-state output per worker.
19 If two economies are identical except for their rates of population growth, then if both economies are in steady state, the economy with the higher rate of population growth will have a
answer. higher rate of growth of total output.
20 In the Solow growth model with population growth (n) and technological progress (g), the steady-state growth rate of output per efficiency unit is
answer. 0.
21 In the Solow growth model with population growth (n) and technological progress (g), the steady-state growth rate of output per worker is
answer. g.
22 In the Solow growth model with population growth (n) and technological progress (g), the steady-state growth rate of total output is
answer. n + g.
23 A permanent change in the growth rate of total output can arise from a change in the
answer. rate of technological progress.
24 The marginal product of capital (MPK) is 1/3; the marginal product of labor (MPL) is 3. Capital is increased by 30; the labor force is increased by 10. How much does output increase?
answer. 40
25 Suppose that the production function is Y = AF(K,L). The (unchanging) share of capital in output is 0.5. Suppose that output increases by 4 percent, the labor force increases by 3 percent, and the capital stock increases by 2 percent. What is the Solow residual in this case?
answer. 1.5 percent
1. In the Solow growth model with population growth (n) and technological progress (g), the steady-state growth rate of output per efficiency unit is
answer. 0.
2. In the Solow growth model with population growth (n) and technological progress (g), the steady-state growth rate of output per worker is
answer. g.
3. In the Solow growth model with population growth (n) and technological Progress (g), the steady-state growth rate of total output is
answer. n + g.
4. A permanent change in the growth rate of total output can arise from a change in the
answer. rate of technological progress.
5. In the Solow growth model with population growth and technological progress, the economy
experiences a 5 percent "labor-augmenting technological progress" if:
answer. the economy grows by 5 percent while the population stays the same.
6. In the Solow growth model with population growth of 5 percent and a labor augmenting technological progress of 3 percent, the economy's:
answer. number of workers grow at 5 percent while the number of effective workers grow at 8 percent.
7. In the Solow model with technological progress, an increase in the rate of technological change will:
answer leave the investment curve unchanged.
8. In a Solow model with population growth and technological progress, the steady state level of consumption is maximized when the steady state marginal product of capital equals the rate of depreciation plus
answer. the rate of population growth plus the rate of technological change.
9. In the Solow growth model, the steady state level of income per person in a country is a function of all the following EXCEPT:
answer. the current level of income in the country.
10. Using the framework of the Solow growth model, the U.S. level of capital is presently
answer. below the Golden Rule level.
11. All of the following are possible explanations for the worldwide slowdown in economic growth during the 70'sand 80's EXCEPT
answer. scarcity of non-petroleum raw materials.
12. In the basic endogenous growth model, the production function exhibits
answer. constant returns.
13. In the basic endogenous growth model, usually called the Y=AK model, as long as the savings rate times the constant A is greater the rate of depreciation, income will grow
answer. forever.
14. In the Solow model, savings leads to _______ growth, but in the Y=AK model, savings can lead to _______ growth.
answer. temporary; persistent
15. Advocates of the Y=AK model interpret capital as
answer. including knowledge.
16. In the two sector model presented in Section 8-4, where the sectors consist of manufacturing firms andresearch universities,
answer. only firms use capital as inputs.
17. In the two sector model, the proportion of labor devoted to research universities determines the
answer. steady-state growth rate of income.
18. In most endogenous growth theories, externalities from firms' research play a crucial role. Economists agreethat research
answer. can exhibit externalities of ambiguous value.
19. The marginal product of capital (MPK) is 1/3; the marginal product of labor (MPL) is 3. Capital is increased by30; the labor force is increased by 10. How much does output increase?
answer. 40
20. Suppose that the production function is Y = AF(K,L). The (unchanging) share of capital in output is 0.5. Suppose that output increases by 4 percent, the labor force increases by 3 percent, and the capital stock increases by 2percent. What is the Solow residual in this case?
answer. 1.5 percent
21. Real-business-cycle theorists believe that fluctuations in output and employment are:
answer. driven by technological shocks.
22. In a recession, firms may keep workers they do not need, so they will have these workers when the recession is over. This is called:
answer. labor hoarding
23. Which of the following is NOT an explanation for variations in the Solow residual?
answer. growth in the capital stock.
