Question 1

Economic growth in the DVCs might increase if IACs

Accepted Answer

A)  reduce their tariffs and import quotas.
B)  encourage more immigration of highly skilled DVC workers.
C)  outlaw direct private investment abroad by IAC corporations.
D)  discourage capital flight to the DVCs.E) All of the above
F) A) and B)

Question 2

Microcredit refers to

Accepted Answer

A)  small-size stock markets with very limited capitalization.
B)  a system of providing credit to small-business owners.
C)  bond markets for governments of small nations.
D)  deposits in small banks in developing nations.E) A) and B)
F) A) and C)

Question 3

Approximately what percentage of the world's income is received by the poorest one-fifth of the world's population?

Accepted Answer

A)  2
B)  5
C)  7
D)  10E) All of the above
F) A) and D)

Question 4

Most of the DVCs find it difficult to accumulate capital goods because

Accepted Answer

A)  the terms of trade prohibit the inflow of private capital from the advanced nations.
B)  it is very difficult to restrict consumption and thus to free resources for capital goods production.
C)  domestic monetary policies designed to achieve price stability result in low interest rates, thereby discouraging investment.
D)  investment is interest inelastic in DVCs.E) None of the above
F) A) and D)

Question 5

Which of the following countries had the highest population growth rate in 2013-2014?

Accepted Answer

A)  United States
B)  Pakistan
C)  China
D)  VenezuelaE) A) and D)
F) None of the above

Question 6

What measure of economic development is used most often to classify nations as industrially advanced or as developing?

Accepted Answer

A)  per capita income
B)  life expectancy at birth
C)  per capita energy consumption
D)  daily per capita calorie supplyE) None of the above
F) B) and C)

Question 7

Per capita incomes must first grow for birth rates to decline.This statement describes the

Accepted Answer

A)  human capital view of population growth.
B)  traditional view of population growth.
C)  capricious universe view.
D)  demographic transition view of population growth.E) All of the above
F) B) and C)

Question 8

Studies generally show that if there is more investment in capital goods in DVCs, there will be greater

Accepted Answer

A)  capital flight.
B)  economic growth.
C)  underemployment.
D)  unemployment.E) B) and C)
F) A) and D)

Question 9

It is sometimes difficult to transfer the advanced technologies of the industrialized nations to the DVCs because

Accepted Answer

A)  the technologies of the IACs are frequently based on relatively expensive labor and relatively cheap capital.
B)  the resource endowments of the IACs and the DVCs are highly similar.
C)  international patent laws prohibit such transfers.
D)  the technologies of the IACs are frequently based on relatively cheap labor and relatively expensive capital.E) B) and C)
F) A) and B)

Question 10

The corruption and poor administration that are common to the public sectors of many DVCs suggest that government may not be very effective in promoting economic growth.

Accepted Answer

A) True 
 B)False

Question 11

Trade barriers that restrict imports from developing countries tend to be

Accepted Answer

A)  highest in the capital goods and technology sectors of those economies.
B)  lowest in the labor-intensive manufacturing sectors of those economies.
C)  lowest for those products in which DVCs have a comparative advantage.
D)  highest for those products in which DVCs have a comparative advantage.E) A) and B)
F) A) and C)

Question 12

Most economists agree that government efforts in economic development must be

Accepted Answer

A)  employed to substitute for private efforts.
B)  designed to support private efforts.
C)  the sole driver of economic development.
D)  kept at a minimum because we can always rely on markets.E) A) and D)
F) A) and C)

Question 13

Many of the major projects of the World Bank have been for

Accepted Answer

A)  making loans to private citizens.
B)  building infrastructure in a nation.
C)  supervising the banking system in DVCs.
D)  establishing new tax systems for governments in DVCs.E) B) and C)
F) C) and D)

Question 14

In recent years, U.S.foreign aid has been

Accepted Answer

A)  less than one-quarter of 1 percent of its output.
B)  about 1 percent of its output.
C)  about 3 percent of its output.
D)  about 5 percent of its output.E) B) and C)
F) B) and D)

Question 15

The DVCs are

Accepted Answer

A)  located primarily in Northern Europe.
B)  located primarily in Western Europe.
C)  located primarily in Africa, Asia, and Latin America.
D)  more or less evenly distributed over the various continents.E) A) and B)
F) A) and C)

Question 16

One major path that leads to growth in both developing nations (DVCs)  as well industrially advanced nations (IACs)  is that productive resources must be

Accepted Answer

A)  owned and managed by the public sector.
B)  distributed more equitably across business sectors.
C)  reallocated to export industries.
D)  used more efficiently.E) A) and B)
F) None of the above

Question 17

Capital flight refers to the fact that many DVCs must use their export earnings to pay interest on their outstanding external debts.

Accepted Answer

A) True 
 B)False

Question 18

One way through which industrially advanced economies can help DVCs is known as "official development assistance (ODA) ," or more simply,

Accepted Answer

A)  foreign investment.
B)  international capital.
C)  foreign aid.
D)  international trade.E) C) and D)
F) All of the above

Question 19

Which characteristic is most typical of human resources in developing nations?

Accepted Answer

A)  a small population base
B)  low unemployment in urban areas
C)  low unemployment in rural areas
D)  high unemployment in urban areasE) B) and C)
F) A) and B)

Question 20

Infrastructure is best illustrated by

Accepted Answer

A)  business equipment and factories.
B)  agricultural machinery and tools.
C)  financial institutions.
D)  roads and bridges.E) None of the above
F) All of the above

Exam 42: The Economics of Developing Countries

Which of the following countries had the highest population growth rate in 2013-2014?

Correct AnswerverifiedShow Answer

In recent years, U.S.foreign aid has been

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Per capita incomes must first grow for birth rates to decline.This statement describes the

Correct AnswerverifiedShow Answer

Many of the major projects of the World Bank have been for

Correct AnswerverifiedShow Answer

The DVCs are

Correct AnswerverifiedShow Answer

Economic growth in the DVCs might increase if IACs

Correct AnswerverifiedShow Answer

Most of the DVCs find it difficult to accumulate capital goods because

Correct AnswerverifiedShow Answer

Capital flight refers to the fact that many DVCs must use their export earnings to pay interest on their outstanding external debts.

Correct AnswerverifiedShow Answer

One major path that leads to growth in both developing nations (DVCs) as well industrially advanced nations (IACs) is that productive resources must be

Correct AnswerverifiedShow Answer

The corruption and poor administration that are common to the public sectors of many DVCs suggest that government may not be very effective in promoting economic growth.

Correct AnswerverifiedShow Answer

Trade barriers that restrict imports from developing countries tend to be

Correct AnswerverifiedShow Answer

Studies generally show that if there is more investment in capital goods in DVCs, there will be greater

Correct AnswerverifiedShow Answer

Approximately what percentage of the world's income is received by the poorest one-fifth of the world's population?

Correct AnswerverifiedShow Answer

Infrastructure is best illustrated by

Correct AnswerverifiedShow Answer

One way through which industrially advanced economies can help DVCs is known as "official development assistance (ODA) ," or more simply,

Correct AnswerverifiedShow Answer

It is sometimes difficult to transfer the advanced technologies of the industrialized nations to the DVCs because

Correct AnswerverifiedShow Answer

Most economists agree that government efforts in economic development must be

Correct AnswerverifiedShow Answer

Microcredit refers to

Correct AnswerverifiedShow Answer

Which characteristic is most typical of human resources in developing nations?

Correct AnswerverifiedShow Answer

What measure of economic development is used most often to classify nations as industrially advanced or as developing?

Correct AnswerverifiedShow Answer

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