25.1 How
is economic growth measured? Why is economic growth important? Why
could the difference between a 2.5 percent and a 3 percent annual growth
rate be of great significance over several decades?
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25.2 When
and where did modern economic growth first happen? What are the major
institutional factors that form the foundation for modern economic
growth? What do they have in common?
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25.3 Why
are some countries today much poorer than other countries? Are today's
poor countries destined to always be poorer than today's rich countries?
If so, explain why. If not explain how today's poor countries can catch
or even pass today's rich countries.
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25.4 What
are the four supply factors of economic growth? What is the demand
factor? What is the efficiency factor? Illustrate these factors in terms
of the production possibilities curve.
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25.5 Suppose
that Alpha and Omega have identically sized working-age populations but
that total annual hours of work are much greater in Alpha than in
Omega. Provide two possible reasons for this difference.
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25.6 What
is growth accounting? To what extent have increases in U.S. real GDP
resulted from more labor inputs? From greater labor productivity?
Rearrange the following contributors to the growth of productivity in order
of their quantitative importance: economies of scale, quantity
capital, improved resource allocation, education and training, and
technological advance.
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25.7 True or false? If false, explain why.a.
Technological advance, which to date has played a relatively small role
in U.S. economic growth, is destined to play a more important role in
the future.b. Many public capital goods are complementary to private capital goods.c. Immigration has slowed economic growth in the United States.
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25.8 Explain
why there is such a close relationship between changes in a nation's
rate of productivity growth and changes in its average real hourly
wage.
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25.9 Relate each of the following to the recent increase in the trend rate of productivity growth:a. Information technology.b. Increasing returns.c. Network effects.d. Global competition.
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25.10 What, if any, are the benefits and costs of economic growth, particularly as measured by real GDP per capita?
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25.11 LAST WORD
Based on the information in this chapter, contrast the economic growth
rates of the United States and China over the last 25 years. How does
the real GDP per capita of China compare with that if the United States?
Why is there such a huge disparity of per capita income between China’s
coastal cities and its interior regions?
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