Question 1

Government can play a major positive role in the early stage of economic development by

Accepted Answer

A)  providing adequate infrastructure.
B)  establishing price controls for products.
C)  promoting exports by subsidizing them.
D)  creating marketing boards for export products.E) A) and D)
F) C) and D)

Question 2

Discuss the "one child per family" policy implemented in China. Why did it need to be overturned?

Accepted Answer

In 1980, the Chinese authorities institu...

Question 3

The ability of the DVCs to use the technologies of the IACs is somewhat limited because

Accepted Answer

A)  the IACs have patents on most of their technologies.
B)  the IACs and the DVCs have much different resource endowments.
C)  the technologies of the IACs rely heavily on unskilled labor.
D)  IAC technologies are labor-intensive, while DVC technologies are capital-intensive.E) A) and D)
F) A) and C)

Question 4

In 2005,

Accepted Answer

A)  the G8 nations canceled $55 billion in debt owed by developing nations.
B)  both direct private investment and government-provided foreign aid to the DVCs increased.
C)  both direct private investment and government-provided foreign aid to the DVCs decreased.
D)  direct private investment to the DVCs decreased, and government-provided foreign aid increased.E) C) and D)
F) A) and D)

Question 5

Between 1990 and 2015, the poverty rate

Accepted Answer

A)  increased from 736 million to 1.9 billion.
B)  stayed constant at 1.9 billion.
C)  increased to 736 million.
D)  decreased from 1.9 billion to 736 million.E) A) and B)
F) A) and C)

Question 6

Describe the three foreign aid methods for delivering funds directly to poor individuals and how effective they have been.

Accepted Answer

Microcredit is small loans that are prov...

Question 7

When economists refer to capital flight, they are speaking of an

Accepted Answer

A)  outflow of financial capital from a certain country.
B)  outflow of real capital from a certain country.
C)  outflow of financial and real capital from a certain country.
D)  outflow of human capital from a certain country.E) A) and D)
F) C) and D)

Question 8

Per capita incomes must first grow for birth rates to decline. This statement describes the

Accepted Answer

A)  human capital view of population growth.
B)  traditional view of population growth.
C)  capricious universe view.
D)  demographic transition view of population growth.E) B) and D)
F) None of the above

Question 9

If the real output of a DVC increases from $200 billion to $240 billion and its population increases from 100 to 110 million, its real per capita output will have

Accepted Answer

A)  increased by about $182.
B)  increased by about $40.
C)  decreased by about $120.
D)  remained unchanged.E) B) and D)
F) A) and C)

Question 10

The World Bank seeks to

Accepted Answer

A)  provide financial backing for the work of the International Monetary Fund.
B)  maintain stable exchange rates in the currencies of developing countries.
C)  assist developing countries in achieving economic growth.
D)  maximize its profits for its worldwide shareholders.E) A) and B)
F) B) and C)

Question 11

The "vicious circle of poverty" for developing nations can best be described by

Accepted Answer

A)  low levels of international trade that reduce exports and increase the dependence on imports.
B)  low incomes that inhibit saving and the accumulation of real and human capital, making it difficult to increase productivity and income.
C)  a large government sector, which reduces the availability of private investment spending but increases macroeconomic stability.
D)  a lack of entrepreneurial talent that limits the formation of businesses and the development of private businesses.E) A) and D)
F) None of the above

Question 12

Most developing countries (DVCs) exhibit a low level of

Accepted Answer

A)  illiteracy.
B)  population growth.
C)  life expectancy.
D)  infant mortality.E) B) and C)
F) C) and D)

Question 13

What are the three basic criticisms of foreign aid to DVCs?

Accepted Answer

(1)Dependency and incentives: A basic cr...

Question 14

Most of the world's population lives in

Accepted Answer

A)  North America.
B)  the DVCs.
C)  Western Europe.
D)  the IACs.E) A) and B)
F) None of the above

Question 15

Which of the following statements is correct?

Accepted Answer

A)  Saving is high in less-developed nations because the opportunities for consumption are limited.
B)  For developing nations, the annual rate of population increase is about 5 percent.
C)  Most of the labor forces of developing nations are engaged in light industrial production.
D)  Investment is low in developing nations, making it difficult to increase productivity and incomes.E) A) and B)
F) C) and D)

Question 16

Brazil, Mexico, and Thailand are referred to as

Accepted Answer

A)  industrially advanced countries.
B)  upper-middle-income developing countries.
C)  low-income developing countries.
D)  command economies.E) B) and D)
F) All of the above

Question 17

Rapid population growth can be an obstacle to economic development

Accepted Answer

A)  because it can translate a relatively large increase in real output into a small increase in real output per capita.
B)  because more investment will be required to simply maintain the quantity of capital goods per person.
C)  because it may lead to the overutilization and therefore ecological degradation of farmland.
D)  for all of these reasons.E) A) and C)
F) A) and B)

Question 18

The DVCs are

Accepted Answer

A)  located primarily in Northern Europe.
B)  located primarily in Western Europe.
C)  located primarily in Africa, Asia, and Latin America.
D)  more or less evenly distributed over the various continents.E) A) and B)
F) All of the above

Question 19

One of the major investment obstacles in less-developed nations is

Accepted Answer

A)  an accumulation of savings with no place to invest the funds.
B)  a poor public infrastructure that hurts returns on private investment.
C)  a progressive tax system that is efficient in collecting taxes on investment.
D)  a low unemployment rate that makes it difficult to find the needed workers for businesses.E) B) and C)
F) C) and D)

Question 20

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 flourishE) B) and C)
F) B) and D)

Exam 28: The Economics of Developing Countries

Government can play a major positive role in the early stage of economic development by

Correct AnswerverifiedShow Answer

One of the major investment obstacles in less-developed nations is

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Discuss the "one child per family" policy implemented in China. Why did it need to be overturned?

Correct AnswerverifiedIn 1980, the Chinese authorities institu...View AnswerShow Answer

The "vicious circle of poverty" for developing nations can best be described by

Correct AnswerverifiedShow Answer

The World Bank seeks to

Correct AnswerverifiedShow Answer

When economists refer to capital flight, they are speaking of an

Correct AnswerverifiedShow Answer

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?

Correct AnswerverifiedShow Answer

Rapid population growth can be an obstacle to economic development

Correct AnswerverifiedShow Answer

Most of the world's population lives in

Correct AnswerverifiedShow Answer

Brazil, Mexico, and Thailand are referred to as

Correct AnswerverifiedShow Answer

Which of the following statements is correct?

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Most developing countries (DVCs) exhibit a low level of

Correct AnswerverifiedShow Answer

Describe the three foreign aid methods for delivering funds directly to poor individuals and how effective they have been.

Correct AnswerverifiedMicrocredit is small loans that are prov...View AnswerShow Answer

The DVCs are

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The ability of the DVCs to use the technologies of the IACs is somewhat limited because

Correct AnswerverifiedShow Answer

Between 1990 and 2015, the poverty rate

Correct AnswerverifiedShow Answer

In 2005,

Correct AnswerverifiedShow Answer

What are the three basic criticisms of foreign aid to DVCs?

Correct Answerverified(1)Dependency and incentives: A basic cr...View AnswerShow Answer

Per capita incomes must first grow for birth rates to decline. This statement describes the

Correct AnswerverifiedShow Answer

If the real output of a DVC increases from $200 billion to $240 billion and its population increases from 100 to 110 million, its real per capita output will have

Correct AnswerverifiedShow Answer

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In 1980, the Chinese authorities institu...
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Microcredit is small loans that are prov...
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(1)Dependency and incentives: A basic cr...
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