Question 1. Between 1968 and 1980, the US economy experienced a slowdown in productivity growth. However, since the mid 1980s, the economy has experienced increases in the growth rate in productivity. Can you give reasons why US productivity growth started to increase during the late 1980s and continued throughout the decade of the 1990s?
Question 2. Due to the presence of diminishing returns to capital, doubling the amount of physical capital available for one worker to use will _______.
- decrease output by less than a factor of two
- increase output by less than a factor of two
- increase output by exactly a factor of two
- increase output by more than a factor of two
Question 3. Economies with higher growth rates tend to be those that _______.
- have large amounts of natural resources
- have a stable government that protects property rights
- have high levels of government regulation
- have all of the above