Chapter 25

Question 1

ECONOMIC GROWTH

Answer 1

an increase of real output or real output per capita

Question 2

RULE OF 70

Answer 2

method for determining the number of years it will take for some measure to double, given its annual percentage increase

Question 3

SUPPLY FACTORS OF GROWTH

Answer 3

an increase in the availability of a resource, better quality, or better technologically which allows it to produce a greater output of goods and services

Question 4

DEMAND FACTOR OF GROWTH

Answer 4

the increase in the level of aggregate demand that brings about the economic growth made possible by an increase in the production potential of the economy

Question 5

EFFICIENCY FACTOR OF GROWTH

Answer 5

the capacity of an economy to combine resources effectively to achieve growth of real output that the supply factors of growth make possible

Question 6

Production possibilities graph

Answer 6

graph showing different combinations of two goods or service that can be produced in a full employment, full production economy

Question 7

LABOR PRODUCTIVITY

Answer 7

total output divided by the quantity of labor employed to produce it

Total output/Quantity of labor employed