Question 1

According to the United Nations, approximately what percentage of the world's income is received by the richest one-fifth of the world's population?

Accepted Answer

A)  24 percent
B)  38 percent
C)  60 percent
D)  75 percentE) B) and C)
F) None of the above

Question 2

Which organization primarily makes and guarantees loans to developing nations for basic development projects such as the construction of dams, roads, and schools?

Accepted Answer

A)  the World Bank
B)  the New Economic Order
C)  the Federal Reserve System
D)  the Committee on Economic DevelopmentE) A) and B)
F) All of the above

Question 3

An increasing share of the private capital flows to DVCs in recent years has been in the form of

Accepted Answer

A)  interest-free government loans.
B)  educational and training assistance.
C)  direct foreign investment.
D)  bank loans.E) None of the above
F) B) and D)

Question 4

Compare the GDP and GDP per capita of the United States with that of developing countries.

Accepted Answer

In 2017, U.S. GDP was $19 trillion while...

Question 5

Developing nations tend to have a large entrepreneurial class but not sufficient capital investment.

Accepted Answer

A) True 
 B)False

Question 6

One of the essential paths to economic growth is

Accepted Answer

A)  increasing population growth.
B)  expanding the role of government.
C)  using existing resources more efficiently.
D)  expanding tax credits for business investment.E) A) and D)
F) All of the above

Question 7

Which of the following would be an example of direct foreign investment in DVCs?

Accepted Answer

A)  a grant from the World Bank to build an irrigation project in Kenya
B)  the financing of a new chemical plant in Peru by a German company
C)  a low-interest loan from the U.S. government to Turkey to purchase military hardware
D)  a loan from the Japanese government to the Indonesian government to pay for electronic equipmentE) A) and C)
F) B) and D)

Question 8

If it is cheaper in the long run to use a new metal plow that lasts a long time than an inferior wooden plow that needs to be replaced often, then this is an example of

Accepted Answer

A)  a capital-using technology.
B)  a capital-saving technology.
C)  capital consumption.
D)  private capital flows.E) A) and B)
F) A) and C)

Question 9

A large portion of foreign aid from IACs to DVCs is provided on the basis of

Accepted Answer

A)  economic considerations.
B)  geographical considerations.
C)  humanitarian considerations.
D)  political and military considerations.E) C) and D)
F) None of the above

Question 10

Microfinance or microcredit can help directly support

Accepted Answer

A)  labor or workers.
B)  local governments.
C)  entrepreneurs.
D)  consumers.E) A) and B)
F) None of the above

Question 11

The vicious circle of poverty is based on the connections between low income, low saving, low investment, and low productivity.

Accepted Answer

A) True 
 B)False

Question 12

Explain the demographic transition view.

Accepted Answer

The demographic transition describes the...

Question 13

The "brain drain" problem in the DVCs refers to the fact the best-educated workers

Accepted Answer

A)  are reluctant to become entrepreneurs.
B)  are concentrated in rural areas where their skills are underutilized.
C)  often immigrate to industrialized countries.
D)  are reluctant to work in the public sector.E) A) and B)
F) None of the above

Question 14

In 2017, the United States had about ___ percent of the world's population and produced about ___ percent of the world's output.

Accepted Answer

A)  20; 30
B)  3.6; 31
C)  10; 28
D)  4.4; 24E) A) and B)
F) A) and C)

Question 15

The World Bank

Accepted Answer

A)  is also known as the International Monetary Fund (IMF) .
B)  lends money to developing nations for basic infrastructure projects such as dams, irrigation, health and sanitation, communications, and transportation.
C)  is an affiliate of the World Trade Organization (WTO) .
D)  provides subsidies to private firms so they can improve their wages and working conditions.E) None of the above
F) C) and D)

Question 16

Successful foreign aid programs

Accepted Answer

A)  enhance a DVC's resources and therefore shift its production possibilities curve to the left.
B)  enhance a DVC's resources and therefore shift its production possibilities curve to the right.
C)  move the DVC from a high-investment-low-consumption position to a low-investment-high-consumption position on its stable production possibilities curve.
D)  cause a DVC's exchange rate to depreciate.E) A) and D)
F) A) and C)

Question 17

Which of the following is not inversely related to per capita income?

Accepted Answer

A)  mortality rates for children under five years of age
B)  adult illiteracy rates
C)  per capita energy consumption
D)  population growth ratesE) A) and B)
F) B) and C)

Question 18

How can the DVCs break out of the vicious circle of poverty?

Accepted Answer

Many economists think that the key to br...

Question 19

A factor that limits the amount of saving in developing countries is the fact that

Accepted Answer

A)  the banking system does not encourage saving.
B)  there is too much foreign aid, so savings is not needed.
C)  the level of aggregate domestic output is low.
D)  the government controls financial institutions and makes it difficult for people to save.E) A) and B)
F) All of the above

Question 20

Capital flight is a problem to DVCs because it

Accepted Answer

A)  causes the value of a DVC's currency to appreciate.
B)  reduces the volume of DVC investment.
C)  reduces the flow of foreign aid from the IACs.
D)  causes inflation in the DVCs.E) B) and D)
F) A) and D)

Exam 28: The Economics of Developing Countries

Which of the following would be an example of direct foreign investment in DVCs?

Correct AnswerverifiedShow Answer

According to the United Nations, approximately what percentage of the world's income is received by the richest one-fifth of the world's population?

Correct AnswerverifiedShow Answer

If it is cheaper in the long run to use a new metal plow that lasts a long time than an inferior wooden plow that needs to be replaced often, then this is an example of

Correct AnswerverifiedShow Answer

Which organization primarily makes and guarantees loans to developing nations for basic development projects such as the construction of dams, roads, and schools?

Correct AnswerverifiedShow Answer

One of the essential paths to economic growth is

Correct AnswerverifiedShow Answer

The "brain drain" problem in the DVCs refers to the fact the best-educated workers

Correct AnswerverifiedShow Answer

A factor that limits the amount of saving in developing countries is the fact that

Correct AnswerverifiedShow Answer

Explain the demographic transition view.

Correct AnswerverifiedThe demographic transition describes the...View AnswerShow Answer

A large portion of foreign aid from IACs to DVCs is provided on the basis of

Correct AnswerverifiedShow Answer

Which of the following is not inversely related to per capita income?

Correct AnswerverifiedShow Answer

Developing nations tend to have a large entrepreneurial class but not sufficient capital investment.

Correct AnswerverifiedShow Answer

Compare the GDP and GDP per capita of the United States with that of developing countries.

Correct AnswerverifiedIn 2017, U.S. GDP was $19 trillion while...View AnswerShow Answer

Microfinance or microcredit can help directly support

Correct AnswerverifiedShow Answer

In 2017, the United States had about ___ percent of the world's population and produced about ___ percent of the world's output.

Correct AnswerverifiedShow Answer

The World Bank

Correct AnswerverifiedShow Answer

An increasing share of the private capital flows to DVCs in recent years has been in the form of

Correct AnswerverifiedShow Answer

Successful foreign aid programs

Correct AnswerverifiedShow Answer

How can the DVCs break out of the vicious circle of poverty?

Correct AnswerverifiedMany economists think that the key to br...View AnswerShow Answer

Capital flight is a problem to DVCs because it

Correct AnswerverifiedShow Answer

The vicious circle of poverty is based on the connections between low income, low saving, low investment, and low productivity.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The demographic transition describes the...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
In 2017, U.S. GDP was $19 trillion while...
View Answer

Correct Answer
verified

In 2017, the United States had about _ percent of the world's population and produced about _ percent of the world's output.

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Many economists think that the key to br...
View Answer

Correct Answer
verified

Correct Answer
verified