Question 1

Economic growth may hinge on whether individuals and institutions within a nation want growth badly enough to change their traditional ways of doing things. This statement refers to

Accepted Answer

A)  in-kind investment.
B)  the capricious universe view.
C)  human capital investment.
D)  the will to develop.E) C) and D)
F) B) and D)

Question 2

The richest 20 percent of the world's population receives more than 75 percent of the world's income, while the poorest 20 percent receives less than 2 percent of the world's income.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following is typically not a problem for low-income DVCs?

Accepted Answer

A)  capital flight
B)  "brain drain"
C)  high saving rates that slow aggregate demand growth
D)  poor infrastructureE) B) and D)
F) All of the above

Question 4

The World Bank is the organization to which DVCs turn as a "last-resort" lending agency for projects that private institutions will not fund.

Accepted Answer

A) True 
 B)False

Question 5

Which attitude or custom is the most conducive to long-term economic growth?

Accepted Answer

A)  a focus on group contentment rather than individual achievement
B)  the belief that there is little or no correlation between an individual's economic actions and her or his economic fortunes
C)  the belief that there is a direct connection between individual efforts (including educational efforts) and economic rewards
D)  the use of the majority of resources for religious structures and ceremoniesE) All of the above
F) A) and B)

Question 6

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 C)

Question 7

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) B) and C)

Question 8

Economists would most likely suggest that advanced nations can best assist in the economic development of developing nations by

Accepted Answer

A)  increasing the amount of military aid to strengthen the government's role in providing law and order.
B)  increasing trade barriers so that less-developed nations will become more self-sufficient.
C)  reducing trade barriers and increasing the amount of private and public capital.
D)  decreasing the amounts of private capital or foreign aid to reduce the level of neocolonialism.E) A) and B)
F) A) and C)

Question 9

In contrast to international development efforts in most of the 20th century, more recent projects like microfinance, microcredit, and cash transfers in the last few decades represent a major shift. That is because these recent projects are

Accepted Answer

A)  all sponsored by local governments.
B)  done through the United Nations.
C)  launched by universities and colleges.
D)  focused on giving direct aid to poor individuals.E) A) and B)
F) B) and D)

Question 10

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 C)
F) None of the above

Question 11

Early experiments with unconditional cash transfers have revealed that

Accepted Answer

A)  most of these cash transfers are repaid within a very short time.
B)  although the money is usually spent on education and capital, cultural obstacles generally prevent this spending from translating into long-term earnings gains.
C)  a majority of recipients use the money for training and equipment that results in a higher long-term income.
D)  most recipients spend the money on current consumption and realize no long-term gain in earning power.E) C) and D)
F) A) and B)

Question 12

Per capita income in the United States in 2017 was about

Accepted Answer

A)  $25,300 per person.
B)  $36,300 per person.
C)  $60,200 per person.
D)  $78,800 per person.E) B) and D)
F) B) and C)

Question 13

In recent years, a greater proportion of private capital flows to DVCs has been direct foreign investment rather than loans to DVC governments.

Accepted Answer

A) True 
 B)False

Question 14

Describe the vicious circle of poverty.

Accepted Answer

The vicious circle of poverty is a probl...

Question 15

Which of the following is a true statement?

Accepted Answer

A)  Direct foreign investment to DVCs is increasingly provided by commercial banks.
B)  Direct foreign investment to DVCs has dwindled to near zero in recent years.
C)  Approximately 5 percent of the GDP of IACs goes to foreign aid.
D)  Foreign aid from the IACs to the DVCs has greatly expanded in the past several years.E) A) and B)
F) All of the above

Question 16

Without an abundant endowment of natural resources, a nation cannot achieve rapid economic growth.

Accepted Answer

A) True 
 B)False

Question 17

More than 75 percent of the world's income is earned by what percentage of the world's population?

Accepted Answer

A)  5 percent
B)  10 percent
C)  20 percent
D)  40 percentE) A) and B)
F) B) and C)

Question 18

The international organization, with 189 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) A) and B)
F) A) and C)

Question 19

The World Bank defines extreme poverty as

Accepted Answer

A)  living on $1.90 per day or less.
B)  living on less than $19 a day.
C)  living without health care and safe water but with adequate food and education.
D)  living on less than $0.19 per day.E) B) and C)
F) A) and D)

Question 20

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

Exam 28: The Economics of Developing Countries

In recent years, a greater proportion of private capital flows to DVCs has been direct foreign investment rather than loans to DVC governments.

Correct AnswerverifiedShow Answer

The international organization, with 189 member nations, whose major objective is to help DVCs achieve economic growth is the

Correct AnswerverifiedShow Answer

The World Bank is the organization to which DVCs turn as a "last-resort" lending agency for projects that private institutions will not fund.

Correct AnswerverifiedShow Answer

Which attitude or custom is the most conducive to long-term economic growth?

Correct AnswerverifiedShow Answer

Per capita income in the United States in 2017 was about

Correct AnswerverifiedShow Answer

Economic growth may hinge on whether individuals and institutions within a nation want growth badly enough to change their traditional ways of doing things. This statement refers to

Correct AnswerverifiedShow Answer

Describe the vicious circle of poverty.

Correct AnswerverifiedThe vicious circle of poverty is a probl...View AnswerShow Answer

Early experiments with unconditional cash transfers have revealed that

Correct AnswerverifiedShow Answer

An example of direct foreign investment is

Correct AnswerverifiedShow Answer

Which of the following is typically not a problem for low-income DVCs?

Correct AnswerverifiedShow Answer

Without an abundant endowment of natural resources, a nation cannot achieve rapid economic growth.

Correct AnswerverifiedShow Answer

The World Bank defines extreme poverty as

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

In contrast to international development efforts in most of the 20th century, more recent projects like microfinance, microcredit, and cash transfers in the last few decades represent a major shift. That is because these recent projects are

Correct AnswerverifiedShow Answer

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

The richest 20 percent of the world's population receives more than 75 percent of the world's income, while the poorest 20 percent receives less than 2 percent of the world's income.

Correct AnswerverifiedShow Answer

Which of the following is a true statement?

Correct AnswerverifiedShow Answer

Microcredit refers to

Correct AnswerverifiedShow Answer

Economists would most likely suggest that advanced nations can best assist in the economic development of developing nations by

Correct AnswerverifiedShow Answer

More than 75 percent of the world's income is earned by what percentage of the world's population?

Correct AnswerverifiedShow Answer

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The vicious circle of poverty is a probl...
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