Question 1

A developing nation may not experience an increase in the average standard of living even if it increases its output of goods and services because of

Accepted Answer

A)  land reform.
B)  population growth.
C)  underemployment and disguised unemployment.
D)  capital-saving technology.E) A) and D)
F) B) and D)

Question 2

Land reform (or the reform of land ownership) is a relatively minor institutional obstacle to economic growth in many developing countries.

Accepted Answer

A) True 
 B)False

Question 3

Over the next 15 years, out of every 10 people added to the world's population will be born in developing countries.

Accepted Answer

A)  6
B)  7
C)  8
D)  9E) B) and D)
F) All of the above

Question 4

The international agency that lends money to DVCs for economic development projects is the

Accepted Answer

A)  World Bank.
B)  International Monetary Fund (IMF) .
C)  World Trade Organization (WTO) .
D)  World Credit Union.E) All of the above
F) A) and D)

Question 5

To stimulate economic growth, it would be best if developing countries adopted policies to

Accepted Answer

A)  discourage foreign investment.
B)  subsidize state industries.
C)  build more human capital.
D)  increase population growth.E) B) and C)
F) A) and B)

Question 6

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) A) and B)
F) A) and C)

Question 7

Foreign aid to the DVCs has been criticized

Accepted Answer

A)  because it may generate economic dependence on the IACs.
B)  because it encourages the centralization of government power over the economy.
C)  because government corruption in the DVCs causes aid to be misused.
D)  for all of these reasons.E) All of the above
F) B) and D)

Question 8

The building of a new factory by a corporation would be an example of increasing the infrastructure in a developing nation.

Accepted Answer

A) True 
 B)False

Question 9

The presence of large and fast-growing populations in developing countries contributes to lower per capita incomes.

Accepted Answer

A) True 
 B)False

Question 10

Expanding the supplies of raw materials, capital equipment, effective labor, and technological knowledge will

Accepted Answer

A)  shift outward the production possibilities curve for a nation.
B)  increase the demand for and decrease the supply of productive resources.
C)  make a nation less productive because of the need to coordinate the increased quantity of resources.
D)  lead to increased population growth that will decrease the per capita growth in a nation.E) A) and B)
F) A) and C)

Question 11

Most of the flow of foreign aid goes to

Accepted Answer

A)  the poorest of developing countries (DVCs) .
B)  the most affluent of the developing country populations.
C)  the smallest developing countries.
D)  about 70 percent of the world's poorest people.E) C) and D)
F) B) and C)

Question 12

In recent years, many DVCs have come to realize that

Accepted Answer

A)  expanded international trade is harmful to DVCs.
B)  private capital investment is essential for economic growth in DVCs.
C)  the International Monetary Fund is the major institutional barrier to economic growth.
D)  government involvement in economic development is the only avenue for economic growth.E) B) and D)
F) All of the above

Question 13

In 2014, the United States had about percent of the world's population and produced about percent of the world output.

Accepted Answer

A)  20; 30
B)  3.6; 31
C)  10; 28
D)  4.4; 22E) C) and D)
F) B) and D)

Question 14

If the per capita incomes of DVCs (developing countries)  grew at the same annual rate as those of IACs (industrially advanced countries) , then the absolute income gap between rich and poor nations over the years would

Accepted Answer

A)  narrow.
B)  widen.
C)  stay the same.
D)  reverse.E) A) and B)
F) A) and C)

Question 15

Refer to the table.If per capita income increases by 10 percent over five years in each of the nations shown, the per capita income gap between country C and country A

Accepted Answer

A)  will remain the same.
B)  will rise from $30,934 to $34,027.
C)  may rise or fall depending on the rate of population growth.
D)  will rise from $31,555 to $34,710.E) A) and D)
F) A) and B)

Question 16

An example of direct foreign investment is

Accepted Answer

A)  a U.S.bank granting a loan to a Guatemalan firm.
B)  General Motors building an auto production facility in China.
C)  a U.S.government foreign aid grant to Bangladesh.
D)  the purchase of debt issued by the Panamanian government.E) All of the above
F) A) and B)

Question 17

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) B) and C)
F) A) and C)

Question 18

The capricious universe view indicates that

Accepted Answer

A)  in the long run, "acts of God" have contained population growth and thus contributed to economic development.
B)  DVCs will obtain biological and chemical weapons and force the redistribution of world wealth.
C)  there is little or no correlation between one's efforts and the rewards he or she receives.
D)  international and civil wars have been the primary impediment to growth.E) B) and C)
F) A) and D)

Question 19

In recent years, the governments of the IACs have

Accepted Answer

A)  forgiven a portion of the debt owed by some low-income DVCs.
B)  substantially reduced foreign aid to the DVCs.
C)  substantially reduced their contributions to the World Bank.
D)  discouraged skilled DVC workers from emigrating to the IACs.E) All of the above
F) A) and B)

Question 20

The international organization, with 188 member nations, whose major objective is to help DVCs achieve economic growth is the

Accepted Answer

A)  World Trade Organization.
B)  World Bank.
C)  G8 Nations.
D)  United Nations.E) C) and D)
F) A) and C)

Exam 22: The Economics of Developing Countries

Foreign aid to the DVCs has been criticized

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

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A developing nation may not experience an increase in the average standard of living even if it increases its output of goods and services because of

Correct AnswerverifiedShow Answer

To stimulate economic growth, it would be best if developing countries adopted policies to

Correct AnswerverifiedShow Answer

Microcredit refers to

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Over the next 15 years, out of every 10 people added to the world's population will be born in developing countries.

Correct AnswerverifiedShow Answer

Refer to the table.If per capita income increases by 10 percent over five years in each of the nations shown, the per capita income gap between country C and country A

Correct AnswerverifiedShow Answer

An example of direct foreign investment is

Correct AnswerverifiedShow Answer

The capricious universe view indicates that

Correct AnswerverifiedShow Answer

Land reform (or the reform of land ownership) is a relatively minor institutional obstacle to economic growth in many developing countries.

Correct AnswerverifiedShow Answer

The international organization, with 188 member nations, whose major objective is to help DVCs achieve economic growth is the

Correct AnswerverifiedShow Answer

In 2014, the United States had about percent of the world's population and produced about percent of the world output.

Correct AnswerverifiedShow Answer

The presence of large and fast-growing populations in developing countries contributes to lower per capita incomes.

Correct AnswerverifiedShow Answer

In recent years, the governments of the IACs have

Correct AnswerverifiedShow Answer

Expanding the supplies of raw materials, capital equipment, effective labor, and technological knowledge will

Correct AnswerverifiedShow Answer

The international agency that lends money to DVCs for economic development projects is the

Correct AnswerverifiedShow Answer

In recent years, many DVCs have come to realize that

Correct AnswerverifiedShow Answer

The building of a new factory by a corporation would be an example of increasing the infrastructure in a developing nation.

Correct AnswerverifiedShow Answer

If the per capita incomes of DVCs (developing countries) grew at the same annual rate as those of IACs (industrially advanced countries) , then the absolute income gap between rich and poor nations over the years would

Correct AnswerverifiedShow Answer

Most of the flow of foreign aid goes to

Correct AnswerverifiedShow Answer

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