ECON 2002.01 Study Guide - Quiz Guide: Creative Destruction, Human Capital

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Published on 28 Sep 2018
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Econ 2002.01 Principles of Macroeconomics
Quiz 3 - Answers
1) Institutions and laws, such as patent protection, that foster innovations lead to economic
growth because they
A) allow the government control of the innovations.
B) give confidence to inventors that they will profit from their innovation.
C) give confidence to consumers that the products they buy are safe.
D) give businesses loans to buy new machinery.
Answer: B
2) When analyzing stages of economic development in the United States, it appears that we have
entered the "tertiary stage." This is a stage marked by a shift toward
A) agriculture.
B) manufacturing.
C) services.
D) population increases.
Answer: C
3) Which one of the following is true?
A) As a country becomes more prosperous, it experiences a higher birth rate.
B) Over the past century, the supply of food has grown more quickly than has the demand for
food.
C) Over the past century, the real price of food has risen, reflecting the pressure of population
growth on food supplies.
D) Over the next half-century, it is expected that population growth in industrially advanced
nations will outpace population growth in developing countries.
Answer: B
4) The term "creative destruction" refers to
A) the process by which immigrants build a new life in their country of destination.
B) the process by which new jobs are created and old ones destroyed.
C) the effects of population growth on the environment.
D) All of the above are correct.
Answer: B
5) In the absence of well-defined property rights, we would likely find
A) people with more incentives to take risks.
B) people with less incentives to take risks.
C) higher economic growth rates.
D) increases in investment activity.
Answer: B
6) The new growth theory of economic growth examines the interaction of
A) labor and population.
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