Solow Model Quiz

Solow Model Quiz

University

9 Qs

quiz-placeholder

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Solow Model Quiz

Solow Model Quiz

Assessment

Quiz

Other

University

Easy

Created by

Hoa P

Used 5+ times

FREE Resource

9 questions

Show all answers

1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

According to the Solow Model, _____________________ is a function of capital.

labor

output

technology

2.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

In the Solow Model, capital is subject to _____________________. So as you add additional units of capital to other fixed resources, there comes a point where more capital does not increase output as much as it did before.

increasing returns

the endowment effect

diminishing returns

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

The Solow Model implies that countries with small initial capital stocks should grow rapidly. This implies that:

poorer countries should eventually 'catch-up' to richer countries (conditional convergence)

poorer countries are bound to experience explosive growth which will propel their economic output far beyond that of rich countries

the growth rates between rich and poor countries is bound to diverge

4.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

In the Solow Model, when capital is depreciating faster than it is being accumulated we may conclude that the capital stock is _________________________.

rising

falling

remaining the same

5.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

In the Solow Model, the point where investment is equal to depreciation is known as the ______________.

steady state

bliss point

growth acceleration point

6.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Japan's and Germany's economic growth after World War II are both examples of

Catching-up growth.

Cutting-edge growth.

7.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

The Solow model is a simple model to explain

Economic growth.

Country differences.

Income inequality.

8.

MULTIPLE CHOICE QUESTION

1 min • 1 pt

For the next two questions, consider the following: Country A has K=10,000 and produces GDP according to the following equation: GDP=5√K. If the country devotes 25% of its GDP to making investment goods, how much is the country investing?

12.5

25

125

1,250

Can not be determined with the given information.

9.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

If 1% of all machines become worthless every year (they depreciate, in other words) in Country A, GDP is

Increasing.

Decreasing.

In steady state.

Can not be determined with the given information.