The opening of a new American-owned factory in Algeria would tend to increase Algeria's GDP more than it increases Algeria's GNP because some of the income from the factory accrues to people who do not live in Algeria.
a. true
b. false
Ans: a. true
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Which of the following scenarios is an example of an investment in human capital?
A. A firm replaces manually controlled production with a computer-controlled procedure. B. A chemical firm supports research to develop new chemicals. C. A firm purchases new equipment for a manufacturing process. D. A firm pays for workers to take college classes.
Of the following views on the effects of immigration on the receiving nation's economic growth, which have NOT been suggested by economists Michael Kremer and Julian Simon?
A) Technological progress is driven by population growth. B) Immigration increases a nation's labor pool and encourages ingenuity. C) Immigration costs the local population jobs and greatly lowers their incomes. D) Immigrants raise the standard of living of a nation's native population.
A social system in which rights are clearly defined and participants are free to exchange as they choose will tend to allocate resources to
A) their most efficient uses. B) their most highly valued uses. C) uses on which the highest monetary value is placed. D) uses which maximize social welfare. E) uses which produce the greatest good for the greatest member.
The unemployment rate will rise when
A) people get discouraged and quit looking for a job. B) the average work week falls from 40 hours to 39 hours. C) the duration of unemployment increases. D) the size of the labor force increases without an increase in employment.