Question 1

GDP per capita is about 10 times higher in industrially advanced countries (IACs)than in the poorer less-developed countries (LDCs).

Accepted Answer

A) True 
 B)False  False

Question 2

Which of the following distinguishes industrially advanced countries from less-developed countries?

Accepted Answer

A) GDP per capita. 
B) Educational attainment of the workforce. 
C) Extent to which capital is technologically advanced. 
D) All of the above. 
A) GDP per capita. 
B) Educational attainment of the workforce. 
C) Extent to which capital is technologically advanced. 
D) All of the above. D

Question 3

Which of the following is most likely to help the residents of a nation produce more goods and services and achieve higher income levels?

Accepted Answer

A) Higher tax rates. 
B) A higher rate of investment. 
C) A smaller trade sector. 
D) Greater use of taxation to transfer income from the rich to the poor. 
A) Higher tax rates. 
B) A higher rate of investment. 
C) A smaller trade sector. 
D) Greater use of taxation to transfer income from the rich to the poor. B

Question 4

The world bank is the agency of the U.S. State Department that is in charge of U.S. loans to foreign countries.

Accepted Answer

A) True 
 B)False

Question 5

If a country's population grows at the same rate as its real GDP, then real per capita GDP:

Accepted Answer

A) grows at an increasing rate. 
B) grows at a constant rate. 
C) doesn't change. 
D) decreases at a decreasing rate. 
E) decreases at a constant rate. 
A) grows at an increasing rate. 
B) grows at a constant rate. 
C) doesn't change. 
D) decreases at a decreasing rate. 
E) decreases at a constant rate.

Question 6

The vicious circle of poverty is the trap that parents with low education tend to have children with low education.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following is correct ?

Accepted Answer

A) Economic development is more quantitative than economic growth. 
B) A country cannot achieve economic growth with a limited base of natural resources. 
C) Infrastructure is capital provided by the private sector. 
D) All of the above are true. 
E) All of the above are false. 
A) Economic development is more quantitative than economic growth. 
B) A country cannot achieve economic growth with a limited base of natural resources. 
C) Infrastructure is capital provided by the private sector. 
D) All of the above are true. 
E) All of the above are false.

Question 8

According to the classification in the text, which of the following is not an industrially advanced country (IAC)?

Accepted Answer

A) United Arab Emirates. 
B) Israel. 
C) Greece. 
D) All of the above are IACs. 
E) None of the above are IACs. 
A) United Arab Emirates. 
B) Israel. 
C) Greece. 
D) All of the above are IACs. 
E) None of the above are IACs.

Question 9

Economic development encompasses which of the following measures?

Accepted Answer

A) Economic growth. 
B) The political environment. 
C) Education. 
D) All of these. 
A) Economic growth. 
B) The political environment. 
C) Education. 
D) All of these.

Question 10

Domestic law and order, the infrastructure, and the climate of international trade are all aspects of a country's:

Accepted Answer

A) natural resources endowment. 
B) human resources investment. 
C) capital investment. 
D) political environment. 
A) natural resources endowment. 
B) human resources investment. 
C) capital investment. 
D) political environment.

Question 11

What is the economic criterion most often used to compare living standards across countries?

Accepted Answer

A) Real GDP growth. 
B) Unemployment rate. 
C) Incidence of AIDS. 
D) Rate of population growth. 
E) Real per capita GDP. 
A) Real GDP growth. 
B) Unemployment rate. 
C) Incidence of AIDS. 
D) Rate of population growth. 
E) Real per capita GDP.

Question 12

If a country's population growth rate exceeds the growth rate in its GDP, which of the following is true ?

Accepted Answer

A) Per capita GDP is rising. 
B) Per capita GDP is not changing. 
C) Per capita GDP is falling. 
D) None of the above. 
A) Per capita GDP is rising. 
B) Per capita GDP is not changing. 
C) Per capita GDP is falling. 
D) None of the above.

Question 13

If an economy's population grows at 3 percent and GDP grows at 4 percent, then:

Accepted Answer

A) per capita real GDP is declining. 
B) the economy's standard of living is decreasing. 
C) per capita real GDP is negative. 
D) per capita real GDP is growing. 
E) the economy is experiencing unemployment. 
A) per capita real GDP is declining. 
B) the economy's standard of living is decreasing. 
C) per capita real GDP is negative. 
D) per capita real GDP is growing. 
E) the economy is experiencing unemployment.

Question 14

Suppose Embryonica is an LDC with few skilled workers, a primitive banking system, and very little electric power. What do we know for sure that Embryonica is lacking?

Accepted Answer

A) Infrastructure. 
B) Political stability. 
C) Agricultural sector. 
D) Traditional values. 
E) Poverty. 
A) Infrastructure. 
B) Political stability. 
C) Agricultural sector. 
D) Traditional values. 
E) Poverty.

Question 15

Which of the following is not evidence of the lower standard of living among less-developed countries?

Accepted Answer

A) High per capita real GDP. 
B) High percentage of households headed by females. 
C) High infant mortality rate. 
D) Low life expectancy. 
E) High birth rate. 
A) High per capita real GDP. 
B) High percentage of households headed by females. 
C) High infant mortality rate. 
D) Low life expectancy. 
E) High birth rate.

Question 16

Which of the following is a characteristic of an LDC?

Accepted Answer

A) Capital flight. 
B) Vicious circle of poverty. 
C) Lack of entrepreneurs. 
D) All of these. 
A) Capital flight. 
B) Vicious circle of poverty. 
C) Lack of entrepreneurs. 
D) All of these.

Question 17

Economic development encompasses which of the following measures?

Accepted Answer

A) Distribution of income. 
B) Legal system. 
C) Transportation structures. 
D) All of these. 
A) Distribution of income. 
B) Legal system. 
C) Transportation structures. 
D) All of these.

Question 18

If a nation remains poor over time, it could be that:

Accepted Answer

A) c and e. 
B) d and e. 
C) the population growth rate is at least as much as the national GDP growth rate. 
D) the per capita real GDP growth rate is larger than the population growth rate. 
E) the national real GDP growth rate is lower than the population growth rate. 
A) c and e. 
B) d and e. 
C) the population growth rate is at least as much as the national GDP growth rate. 
D) the per capita real GDP growth rate is larger than the population growth rate. 
E) the national real GDP growth rate is lower than the population growth rate.

Question 19

Which of the following is true ?

Accepted Answer

A) Nations achieve high rates of economic growth primarily because of their natural resource endowments. 
B) Human and physical capital investments are largely irrelevant to economic growth. 
C) Poor nations grow slowly because they do not have access to modern technology. 
D) A favorable political environment attracts more investment in human and physical capital. 
A) Nations achieve high rates of economic growth primarily because of their natural resource endowments. 
B) Human and physical capital investments are largely irrelevant to economic growth. 
C) Poor nations grow slowly because they do not have access to modern technology. 
D) A favorable political environment attracts more investment in human and physical capital.

Question 20

An outward shift of an economy's production possibilities curve is caused by:

Accepted Answer

A) an increase in capital. 
B) an increase in labor. 
C) an advance in technology. 
D) all of these. 
A) an increase in capital. 
B) an increase in labor. 
C) an advance in technology. 
D) all of these.

Exam 20: Growth and the Less-Developed Countries

GDP per capita is about 10 times higher in industrially advanced countries (IACs)than in the poorer less-developed countries (LDCs).

Which of the following distinguishes industrially advanced countries from less-developed countries?

Which of the following is most likely to help the residents of a nation produce more goods and services and achieve higher income levels?

The world bank is the agency of the U.S. State Department that is in charge of U.S. loans to foreign countries.

If a country's population grows at the same rate as its real GDP, then real per capita GDP:

The vicious circle of poverty is the trap that parents with low education tend to have children with low education.

Which of the following is correct ?

According to the classification in the text, which of the following is not an industrially advanced country (IAC)?

Economic development encompasses which of the following measures?

Domestic law and order, the infrastructure, and the climate of international trade are all aspects of a country's:

What is the economic criterion most often used to compare living standards across countries?

If a country's population growth rate exceeds the growth rate in its GDP, which of the following is true ?

If an economy's population grows at 3 percent and GDP grows at 4 percent, then:

Suppose Embryonica is an LDC with few skilled workers, a primitive banking system, and very little electric power. What do we know for sure that Embryonica is lacking?

Which of the following is not evidence of the lower standard of living among less-developed countries?

Which of the following is a characteristic of an LDC?

Economic development encompasses which of the following measures?

If a nation remains poor over time, it could be that:

Which of the following is true ?

An outward shift of an economy's production possibilities curve is caused by:

Introducing the Economic Way of Thinking

Production Possibilities, Opportunity Cost, and Economic Growth

Market Demand and Supply

Markets in Action

Gross Domestic Product

Business Cycles and Unemployment

Inflation

The Keynesian Model

The Keynesian Model in Action

Aggregate Demand and Supply

Fiscal Policy

The Public Sector

Federal Deficits, Surpluses, and the National Debt

Money and the Federal Reserve System

Money Creation

Monetary Policy

The Phillips Curve and Expectations Theory

International Trade and Finance

Economies in Transition

Applying Graphs to Economics

Consumer Surplus, Producer Surplus, and Market Efficiency

the Self-Correcting Aggregate Demand and Supply Model

Policy Disputes Using the Self-Correcting Aggregate Demand and Supply Model

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