Question 1

Which of the following is infrastructure?

Accepted Answer

A) Police. 
B) Training and education. 
C) Highways. 
D) All of the above. 
E) None of the above. 
A) Police. 
B) Training and education. 
C) Highways. 
D) All of the above. 
E) None of the above.

Question 2

A country can develop without a large natural resource base.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following is infrastructure?

Accepted Answer

A) Highways. 
B) Bridges. 
C) Airports. 
D) All of these. 
A) Highways. 
B) Bridges. 
C) Airports. 
D) All of these.

Question 4

Which of the following is not a common characteristic of IACs?

Accepted Answer

A) Market-based economies. 
B) Large stocks of technologically advanced capital. 
C) Well-educated labor. 
D) Low per capita energy consumption. 
A) Market-based economies. 
B) Large stocks of technologically advanced capital. 
C) Well-educated labor. 
D) Low per capita energy consumption.

Question 5

Waste systems and highways are part of a nation's infrastructure.

Accepted Answer

A) True 
 B)False

Question 6

According to the text, Singapore and Hong Kong are classified as industrially advanced countries (IACs).

Accepted Answer

A) True 
 B)False

Question 7

One reason that a poor nation remains poor over time is that even though total national real GDP grows,

Accepted Answer

A) c and e. 
B) c, d, and e. 
C) it is too small to begin with. 
D) the growth rate is smaller than the growth rate of industrialized nations. 
E) it does not grow faster than population. 
A) c and e. 
B) c, d, and e. 
C) it is too small to begin with. 
D) the growth rate is smaller than the growth rate of industrialized nations. 
E) it does not grow faster than population.

Question 8

According to the text, Ireland and Israel are classified as less developed countries (LDCs).

Accepted Answer

A) True 
 B)False

Question 9

According to the text, Singapore is classified as a less developed country (LDC).

Accepted Answer

A) True 
 B)False

Question 10

Which of the following statements explains the vicious circle of poverty?

Accepted Answer

A) By investing in education and infrastructure at the same time, the country can overcome the problems of poverty. 
B) Poverty arises out of the lack of investment, but countries cannot invest because they are poor. 
C) A nation can shift its production possibilities curve inward by shifting more resources into the production of capital goods. 
D) A nation can shift its production possibilities curve outward by shifting more resources into the production of consumer goods. 
E) There are dual economies in the world: Some are meant to be rich and others are meant to be poor. 
A) By investing in education and infrastructure at the same time, the country can overcome the problems of poverty. 
B) Poverty arises out of the lack of investment, but countries cannot invest because they are poor. 
C) A nation can shift its production possibilities curve inward by shifting more resources into the production of capital goods. 
D) A nation can shift its production possibilities curve outward by shifting more resources into the production of consumer goods. 
E) There are dual economies in the world: Some are meant to be rich and others are meant to be poor.

Question 11

Which of the following best defines the vicious circle of poverty?

Accepted Answer

A) Countries are poor because they cannot afford to save and invest. 
B) Countries are poor because of high population growth. 
C) Countries are poor because of lack of education and training for workers. 
D) Countries are poor because of poor international credit. 
A) Countries are poor because they cannot afford to save and invest. 
B) Countries are poor because of high population growth. 
C) Countries are poor because of lack of education and training for workers. 
D) Countries are poor because of poor international credit.

Question 12

Which of the following is not a characteristic of less-developed countries?

Accepted Answer

A) High rates of illiteracy. 
B) High unemployment. 
C) Over half of the labor force in agriculture. 
D) Low savings and investment rates. 
E) Low infant mortality rates. 
A) High rates of illiteracy. 
B) High unemployment. 
C) Over half of the labor force in agriculture. 
D) Low savings and investment rates. 
E) Low infant mortality rates.

Question 13

Exhibit 17-1 Nation of Padia   Exhibit 17-1 shows the production possibility curve of the nation of Padia. Based only on this information, the point which would produce the highest rate of growth would be:

Accepted Answer

A) I 
B) II 
C) III 
D) IV 
E) V 
A) I 
B) II 
C) III 
D) IV 
E) V

Question 14

Which of the following is most important if the living standards of people residing in a country are going to improve?

Accepted Answer

A) growth of population 
B) growth of per capita GDP 
C) growth of the money supply 
D) growth of government expenditures as a share of GDP 
A) growth of population 
B) growth of per capita GDP 
C) growth of the money supply 
D) growth of government expenditures as a share of GDP

Question 15

Which of the following statements is true ?

Accepted Answer

A) A less developed country (LD
C) is a country with a low GDP per capita, low levels of capital, and uneducated workers. 
B) The vicious circle of poverty exists because GDP must rise before people can save and invest. 
C) LDCs are characterized by rapid population growth and low levels of investment in human capital. 
D) All of these. 
A) A less developed country (LD
C) is a country with a low GDP per capita, low levels of capital, and uneducated workers. 
B) The vicious circle of poverty exists because GDP must rise before people can save and invest. 
C) LDCs are characterized by rapid population growth and low levels of investment in human capital. 
D) All of these.

Question 16

The poorest regions in the world, as measured by GDP per capita, are:

Accepted Answer

A) Latin America and the Caribbean. 
B) the Middle East and North Africa. 
C) Sub-Saharan Africa and South Asia. 
D) Australia and New Zealand. 
A) Latin America and the Caribbean. 
B) the Middle East and North Africa. 
C) Sub-Saharan Africa and South Asia. 
D) Australia and New Zealand.

Question 17

If national real GDP grows at twice the rate of population growth,

Accepted Answer

A) c and e. 
B) eventually there will be too much GDP. 
C) per real capita GDP will double each year. 
D) per real capita GDP will be reduced by half each year. 
E) per real capita GDP growth will double each year. 
A) c and e. 
B) eventually there will be too much GDP. 
C) per real capita GDP will double each year. 
D) per real capita GDP will be reduced by half each year. 
E) per real capita GDP growth will double each year.

Question 18

Political instability is a deterrent to long-term private investment.

Accepted Answer

A) True 
 B)False

Question 19

Which of the following statements draws a false conclusion?

Accepted Answer

A) Life expectancy in an average African country is lower than in an average European country; therefore Europeans can expect to outlive Africans. 
B) Nations that currently produce no capital goods, and whose inhabitants are hungry, risk famine with internally funded capital investments. 
C) Some African nations have substantially more food and capital investment than others; therefore, their standard of living is higher. 
D) Population reduction policies, if effective, can improve the nation's wealth by increasing real per capita GDP. 
E) The vicious circle of poverty argument states that poverty precludes capital investment and that no capital investment perpetuates poverty. 
A) Life expectancy in an average African country is lower than in an average European country; therefore Europeans can expect to outlive Africans. 
B) Nations that currently produce no capital goods, and whose inhabitants are hungry, risk famine with internally funded capital investments. 
C) Some African nations have substantially more food and capital investment than others; therefore, their standard of living is higher. 
D) Population reduction policies, if effective, can improve the nation's wealth by increasing real per capita GDP. 
E) The vicious circle of poverty argument states that poverty precludes capital investment and that no capital investment perpetuates poverty.

Question 20

Of the following choices, which is the best example of a nation's economic infrastructure?

Accepted Answer

A) Natural resources. 
B) Highway system. 
C) Government. 
D) Religious and cultural beliefs. 
E) Population growth rate. 
A) Natural resources. 
B) Highway system. 
C) Government. 
D) Religious and cultural beliefs. 
E) Population growth rate.

Exam 20: Growth and the Less-Developed Countries

Which of the following is infrastructure?

A country can develop without a large natural resource base.

Which of the following is infrastructure?

Which of the following is not a common characteristic of IACs?

Waste systems and highways are part of a nation's infrastructure.

According to the text, Singapore and Hong Kong are classified as industrially advanced countries (IACs).

One reason that a poor nation remains poor over time is that even though total national real GDP grows,

According to the text, Ireland and Israel are classified as less developed countries (LDCs).

According to the text, Singapore is classified as a less developed country (LDC).

Which of the following statements explains the vicious circle of poverty?

Which of the following best defines the vicious circle of poverty?

Which of the following is not a characteristic of less-developed countries?

Exhibit 17-1 Nation of Padia Exhibit 17-1 shows the production possibility curve of the nation of Padia. Based only on this information, the point which would produce the highest rate of growth would be:

Which of the following is most important if the living standards of people residing in a country are going to improve?

Which of the following statements is true ?

The poorest regions in the world, as measured by GDP per capita, are:

If national real GDP grows at twice the rate of population growth,

Political instability is a deterrent to long-term private investment.

Which of the following statements draws a false conclusion?

Of the following choices, which is the best example of a nation's economic infrastructure?

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

Filters