LRAS
Productivity
Economic Growth
Policies
PPC
100
Draw a LRAS curve
100
The gifts of nature o.O
Natural Resources
100
A new education initiative would increase or decrease labor productivity?
Increase
100
Policies that promote economic growth through the encouragement of investment in physical capital classify under what policy?
Capital Per Worker
100
A shift to the right would be caused by?
More resources, or improved technology
200
The LRAS is vertical at what level of output?
Full-employment
200
Goods used to make other goods and services
Capital goods
200
An expansionary economic policy that leads to lower interest rates would increase or decrease long term economic growth?
Increase
200
Cutting interest rates to boost aggregate demand falls under what type of policy?
Monetary Policy
200
What does point C mean?
Inefficiency exists, unemployment in the economy
300
The location of the LRAS depends on what?
The productive capacity of the economy
300
Education and skills possessed by labor resources
Human Resources
300
If the government raises taxes on business would it cause an increase or decrease in long term economic growth?
Decrease
300
Public Capital used for production is known as what?
Infrastructure
300
A graphical device that shows the combination of two goods that a nation can efficiently produce with available resources and technology.
PPC
400
How can output in the economy be greater than LRAS in the short run?
Resources are being used more intensively
400
When production becomes more efficient
Technology
400
If the central bank expands the money supply to boost spending as a result of a recession what would happen in the long term?
No long term economic growth
400
True or False
Do governments promote economic growth by providing the optimal amount of government intervention?
True
400
What does PPC represent?
Opportunity cost and the maximum amount of goods an services which can be produced in an economy
500
Aggregate output can only increase in the long run if what?
The LRAS has increased
500
What is the most basic sense in which economic growth is defined?
An increase in an economy's total productive capacity at full employment
500
Research and development leads to improve a country's infrastructure
Increase
500
What are the four factors that contribute to a nation's productivity a.k.a. economic growth?
1. Capital Per Worker
2. Human Capital Per Worker
3. Natural Resources Per Worker
4. Technology
500
A production possibility curve will be a straight line when
Resources are not specialized