12.3 Economic Growth

Which of the following best describes per capita real economic growth?

• An increase in per capita real GDP from one period to the next.

• An increase in total population from one period to the next.

• A decrease in real GDP from one period to the next.

• A decrease in per capita real GDP from one period to the next.

If a country's real GDP increases but its population increases at a faster rate, what is likely to happen to its per capita real GDP?

• It will decrease.

• It will remain the same.

• It will increase.

• It will double.

How can a PPF be used in economics?

• To show what absolute economic growth looks like.

• To measure inflation rates.

• To calculate interest rates.

• To determine population growth.

If a point lies inside the PPF curve, what does it indicate about resource utilization?

• Resources are fully utilized

• Resources are underutilized

• Resources are overutilized

• Resources are not available

Which of the following can cause a rightward shift in the Production Possibility Frontier (PPF)?

• Only natural resources

• Only labor

• Natural resources, labor, capital, human capital, technological advances, and incentives

• Only capital investments

How can capital investments affect labor productivity?

• They decrease labor productivity

• They have no effect on labor productivity

• They can increase labor productivity

• They only affect natural resources

Suppose a country invests heavily in technological advances and human capital. Based on the information provided, what is the most likely effect on its PPF?

• The PPF will shift leftward

• The PPF will remain unchanged

• The PPF will shift rightward

• The PPF will disappear

According to the material, what might be a consequence of continued economic and population growth?

• More clean air and water

• Less crowded cities

• No land for people to live on comfortably

• Decreased social and psychological issues

Which of the following is NOT mentioned as a possible result of economic growth?

• More factories

• More pollution

• More green spaces

• More crowded cities

Explain how economic growth can lead to increased social and psychological issues. Use evidence from the material to support your answer.

• Economic growth can cause more pollution, crowded cities, and stress, leading to social and psychological issues.

• Economic growth always leads to happiness and well-being.

• Economic growth reduces the need for social interaction.

• Economic growth eliminates psychological problems.