Question 1

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. 
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.

Question 2

A major criticism of foreign aid to developing nations is that it

Accepted Answer

A) provides incentives to reduce the role of government. 
B) is capital-using rather than capital-saving when it is spent. 
C) encourages dependency rather than self-sustained growth. 
D) leads to widespread underemployment and unemployment. 
A) provides incentives to reduce the role of government. 
B) is capital-using rather than capital-saving when it is spent. 
C) encourages dependency rather than self-sustained growth. 
D) leads to widespread underemployment and unemployment.

Question 3

Industrially advanced countries can best help developing countries by

Accepted Answer

A) establishing price supports for the products produced by DVCs. 
B) increasing tariffs and quotas on products produced by DVCs. 
C) increasing the flows of private capital to DVCs. 
D) increasing control over DVCs' capital markets. 
A) establishing price supports for the products produced by DVCs. 
B) increasing tariffs and quotas on products produced by DVCs. 
C) increasing the flows of private capital to DVCs. 
D) increasing control over DVCs' capital markets.

Question 4

When technological advances are of the capital-using kind, it is possible for an economy to increase its productivity without any net investment in capital goods.

Accepted Answer

A) True 
 B)False

Question 5

Which of the given nations would be middle-income developing countries (DVCs), according to the World Bank?

Accepted Answer

A) country E only 
B) countries A, D, and E 
C) countries D and E 
D) country D only 
A) country E only 
B) countries A, D, and E 
C) countries D and E 
D) country D only

Question 6

Small loans to entrepreneurs and small business owners in DVCs are referred to as

Accepted Answer

A) human capital development projects. 
B) microcredit. 
C) capital flight promotion systems. 
D) incubator lending. 
A) human capital development projects. 
B) microcredit. 
C) capital flight promotion systems. 
D) incubator lending.

Question 7

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 percent 
A) 5 percent 
B) 10 percent 
C) 20 percent 
D) 40 percent

Question 8

An obstacle to economic growth in developing countries is

Accepted Answer

A) the limited demand for natural resources. 
B) the limited supply of capital goods. 
C) a decline in population growth. 
D) the low productivity of capital. 
A) the limited demand for natural resources. 
B) the limited supply of capital goods. 
C) a decline in population growth. 
D) the low productivity of capital.

Question 9

Making "soft loans"-loans that may not be self-liquidating-to the very poorest of the developing countries on relatively liberal terms is the primary function of the

Accepted Answer

A) United Nations. 
B) International Finance Corporation. 
C) New Global Compact. 
D) International Development Association. 
A) United Nations. 
B) International Finance Corporation. 
C) New Global Compact. 
D) International Development Association.

Question 10

Which of the following is not a reason why government may play a key role in the early stage of economic development in developing nations?

Accepted Answer

A) the infrastructure provided by government 
B) the abundance of entrepreneurs who need to be regulated 
C) the need to encourage saving and investment in the economy 
D) the provision of law and order so that commerce can flourish 
A) the infrastructure provided by government 
B) the abundance of entrepreneurs who need to be regulated 
C) the need to encourage saving and investment in the economy 
D) the provision of law and order so that commerce can flourish

Question 11

The population growth rate of the DVCs (developing countries) as a group in recent decades has been

Accepted Answer

A) steady. 
B) declining. 
C) rising modestly. 
D) rising rapidly. 
A) steady. 
B) declining. 
C) rising modestly. 
D) rising rapidly.

Question 12

The government of a DVC may purposely cause inflation because

Accepted Answer

A) a rapid rate of inflation attracts private foreign capital into a DVC. 
B) there is conclusive evidence that inflation discourages people from having large families. 
C) this will strengthen the nation's position in international markets. 
D) inflation works like taxation in that it may release resources from consumption so that they can be invested. 
A) a rapid rate of inflation attracts private foreign capital into a DVC. 
B) there is conclusive evidence that inflation discourages people from having large families. 
C) this will strengthen the nation's position in international markets. 
D) inflation works like taxation in that it may release resources from consumption so that they can be invested.

Question 13

Refer to the table.Which of the following might reduce the per capita income gap between countries A and E?

Accepted Answer

A) faster population growth in country A than in country E 
B) greater investment relative to GDP in country E than in country A 
C) more rapid improvement in literacy and education in country A than in country E 
D) increased capital flight from country A relative to that from country E 
A) faster population growth in country A than in country E 
B) greater investment relative to GDP in country E than in country A 
C) more rapid improvement in literacy and education in country A than in country E 
D) increased capital flight from country A relative to that from country E

Question 14

Per capita income in the United States in 2014 was about

Accepted Answer

A) $25,300 per person. 
B) $36,300 per person. 
C) $55,200 per person. 
D) $68,800 per person. 
A) $25,300 per person. 
B) $36,300 per person. 
C) $55,200 per person. 
D) $68,800 per person.

Question 15

DVCs tend to have permanent shortages of farm labor.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following is not part of a nation's infrastructure?

Accepted Answer

A) communications facilities 
B) roads, highways, and bridges 
C) the electrical power system 
D) industrial plants and equipment 
A) communications facilities 
B) roads, highways, and bridges 
C) the electrical power system 
D) industrial plants and equipment

Question 17

Capital flight from the DVCs may be caused by

Accepted Answer

A) a fear of government privatization efforts. 
B) slow domestic inflation. 
C) low rates of domestic taxation. 
D) risks of severe fluctuations in exchange rates. 
A) a fear of government privatization efforts. 
B) slow domestic inflation. 
C) low rates of domestic taxation. 
D) risks of severe fluctuations in exchange rates.

Question 18

Income gains in the poorest DVCs may increase population growth initially, at least for a while, due to the following reasons except

Accepted Answer

A) declining death rates 
B) increasing birth rates 
C) reduced infant mortality 
D) decreasing life expectancy 
A) declining death rates 
B) increasing birth rates 
C) reduced infant mortality 
D) decreasing life expectancy

Question 19

China is close to catching up with the United States in its standard of living as measured by per capita income.

Accepted Answer

A) True 
 B)False

Question 20

Suppose that the average annual rate of population increase in Econland in recent years was about 2 percent.Based on this rate of growth, the population of Econland will double in about

Accepted Answer

A) 7 years. 
B) 11 years. 
C) 35 years. 
D) 46 years. 
A) 7 years. 
B) 11 years. 
C) 35 years. 
D) 46 years.

Exam 22: The Economics of Developing Countries

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

A major criticism of foreign aid to developing nations is that it

Industrially advanced countries can best help developing countries by

When technological advances are of the capital-using kind, it is possible for an economy to increase its productivity without any net investment in capital goods.

Which of the given nations would be middle-income developing countries (DVCs), according to the World Bank?

Small loans to entrepreneurs and small business owners in DVCs are referred to as

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

An obstacle to economic growth in developing countries is

Making "soft loans"-loans that may not be self-liquidating-to the very poorest of the developing countries on relatively liberal terms is the primary function of the

Which of the following is not a reason why government may play a key role in the early stage of economic development in developing nations?

The population growth rate of the DVCs (developing countries) as a group in recent decades has been

The government of a DVC may purposely cause inflation because

Refer to the table.Which of the following might reduce the per capita income gap between countries A and E?

Per capita income in the United States in 2014 was about

DVCs tend to have permanent shortages of farm labor.

Which of the following is not part of a nation's infrastructure?

Capital flight from the DVCs may be caused by

Income gains in the poorest DVCs may increase population growth initially, at least for a while, due to the following reasons except

China is close to catching up with the United States in its standard of living as measured by per capita income.

Suppose that the average annual rate of population increase in Econland in recent years was about 2 percent.Based on this rate of growth, the population of Econland will double in about

B: Limits, Alternatives, and Choices

A: - Limits, Alternatives, and Choices

B: The Market System and the Circular Flow

A: - The Market System and the Circular Flow

B: Demand, Supply, and Market Equilibrium

A: - Demand, Supply, and Market Equilibrium

B: Market Failures: Public Goods and Externalities

A: - Market Failures: Public Goods and Externalities

B: Governments Role and Government Failure

A: Governments Role and Government Failure

B: an Introduction to Macroeconomics

A: an Introduction to Macroeconomics

B: Measuring the Economys Output

A: Measuring the Economys Output

B: Economic Growth

A: Economic Growth

B: Business Cycles, Unemployment, and Inflation

A: Business Cycles, Unemployment, and Inflation

B: Basic Macroeconomic Relationships

A: Basic Macroeconomic Relationships

B: The Aggregate Expenditures Model

A: The Aggregate Expenditures Model

B: Aggregate Demand and Aggregate Supply

A: Aggregate Demand and Aggregate Supply

B: Fiscal Policy, Deficits, Surpluses, and Debt

A: Fiscal Policy, Deficits, Surpluses, and Debt

B: Money, Banking, and Money Creation

A: Money, Banking, and Money Creation

B: Interest Rates and Monetary Policy

A: Interest Rates and Monetary Policy

C: Financial Economics

A: Long-Run Macroeconomic Adjustments

B: Long-Run Macroeconomic Adjustments

A: International Trade

B: International Trade

A: The Balance of Payments and Exchange Rates

B: The Balance of Payments and Exchange Rates

Filters