Give some possible explanations of the productivity slowdown in the United States that occurred in the 1973-1995 period
Several possible explanations have been offered for the slowdown in labor productivity that hit the United States in 1973 . One of the most common explanations is the increasing price of energy caused by the OPEC policies of the 1970s. However, this explanation has some flaws since energy prices fell in the 1980s, but productivity did not improve during that period. Another suggested explanation was the decline in labor force quality. Proponents of this argument point to the declines in SAT scores that occurred after the late 1960s. However, other indicators of labor force quality such as school attendance and graduation rates increased during this same time period. The best explanation seems to be a technology lag caused by the time period needed by businesses to realize the benefits of technological innovations produced in the 1970s and the 1980s. Such innovations as the personal computer and the Internet took some time to show a payoff in labor force productivity. An interesting analogy is the development of electric power early in the twentieth century. It took at least two decades for business leaders to realize the best ways to use electricity to increase their productivity. So it seems there might have been a similar "lag" in productivity increases during the 1970s and 1980s while businesses were figuring out the best ways to use all the advances in information technology and other innovations.
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Which of the following is true of nominal GDP?
a. It acts as an indicator of the general price level in the economy. b. It measures the real level of output in the economy. c. It measures national output based on the current year's prices. d. It tends to rise by a smaller amount than real GDP when the general price level increases. e. It measures changes in the output of intermediate goods and services.
An advantage of pollution taxes that is not offered by command-and-control policies is that:
A. with a pollution tax, zero pollution is produced. B. a pollution tax decreases the price of the polluting good. C. with a pollution tax, firms have flexibility in their choice of strategies to use to clean up pollution. D. a pollution tax decreases the demands for goods that cause pollution.
Which of the following would tell us that resources are NOT flowing to their highest valued uses?
A. short-run economic profits B. Some firms are just breaking even. C. short-run economic losses D. long-run economic profits
Answer the following statements true (T) or false (F)
1. The period known as the "Industrial Revolution" began in the United States in the late 1800's. 2. Citizens living in the richest nations today have material standards of living that are on average more than 50 times higher than people living in the poorest countries. 3. Savings are generated when current consumption is less than current output. 4. Buying 100 shares of Google stock would be an example of economic investment 5. Economists use the word investment to refer to the purchase of assets such as stocks, bonds, and real estate.