Question 1

One major path that leads to growth in both developing nations (DVCs) as well industrially advanced nations (IACs) is that productive resources must be

Accepted Answer

A) owned and managed by the public sector. 
B) distributed more equitably across business sectors. 
C) reallocated to export industries. 
D) used more efficiently. 
A) owned and managed by the public sector. 
B) distributed more equitably across business sectors. 
C) reallocated to export industries. 
D) used more efficiently.

Question 2

In recent decades,

Accepted Answer

A) all countries classified as DVCs have had little or no economic growth. 
B) some nations classified as DVCs have grown rapidly, while others have grown very slowly or not at all. 
C) all countries classified as DVCs have experienced rapid economic growth and rising living standards. 
D) all countries classified as low-income DVCs have had declining per capita GDPs. 
A) all countries classified as DVCs have had little or no economic growth. 
B) some nations classified as DVCs have grown rapidly, while others have grown very slowly or not at all. 
C) all countries classified as DVCs have experienced rapid economic growth and rising living standards. 
D) all countries classified as low-income DVCs have had declining per capita GDPs.

Question 3

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

Accepted Answer

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

Question 4

One of the major objectives of the World Bank is to

Accepted Answer

A) provide financial backing for the United Nations. 
B) maximize its profits for its worldwide shareholders. 
C) provide technical assistance to DVCs. 
D) maintain stable exchange rates in IACs and DVCs. 
A) provide financial backing for the United Nations. 
B) maximize its profits for its worldwide shareholders. 
C) provide technical assistance to DVCs. 
D) maintain stable exchange rates in IACs and DVCs.

Question 5

The diversion of surplus labor in agriculture to the production of schools or roads in developing countries is described as

Accepted Answer

A) land reform. 
B) the brain drain. 
C) in-kind investment. 
D) a capital-using technological advance. 
A) land reform. 
B) the brain drain. 
C) in-kind investment. 
D) a capital-using technological advance.

Question 6

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 7

Many of the major projects of the World Bank have been for

Accepted Answer

A) making loans to private citizens. 
B) building infrastructure in a nation. 
C) supervising the banking system in DVCs. 
D) establishing new tax systems for governments in DVCs. 
A) making loans to private citizens. 
B) building infrastructure in a nation. 
C) supervising the banking system in DVCs. 
D) establishing new tax systems for governments in DVCs.

Question 8

The primary function of the International Finance Corporation (IFC) is to

Accepted Answer

A) provide U.S.surplus food to low-income countries. 
B) provide short-term loans to poor countries to finance international trade deficits. 
C) make infrastructure loans, that is, loans for highways, schools, communication facilities, and so forth. 
D) make loans to private enterprises in the DVCs. 
A) provide U.S.surplus food to low-income countries. 
B) provide short-term loans to poor countries to finance international trade deficits. 
C) make infrastructure loans, that is, loans for highways, schools, communication facilities, and so forth. 
D) make loans to private enterprises in the DVCs.

Question 9

Many countries remain poor because they currently are poor.This statement summarizes the

Accepted Answer

A) infrastructure problem. 
B) vicious circle of poverty. 
C) demographic transition problem. 
D) problem of capital flight. 
A) infrastructure problem. 
B) vicious circle of poverty. 
C) demographic transition problem. 
D) problem of capital flight.

Question 10

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 11

The capricious universe view is the idea that the IACs are exploiting the DVCs.

Accepted Answer

A) True 
 B)False

Question 12

Capital flight is a problem facing DVCs that involves the

Accepted Answer

A) difficulty of sustaining skilled workers in the government sector of the DVC economies. 
B) transfer of private savings from DVCs to IACs. 
C) flight of agricultural workers from rural to urban areas, especially capital cities, to take advantage of better job opportunities. 
D) movement of capital goods from IACs to DVCs to avoid taxes. 
A) difficulty of sustaining skilled workers in the government sector of the DVC economies. 
B) transfer of private savings from DVCs to IACs. 
C) flight of agricultural workers from rural to urban areas, especially capital cities, to take advantage of better job opportunities. 
D) movement of capital goods from IACs to DVCs to avoid taxes.

Question 13

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. 
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.

Question 14

The traditional view regarding population and growth in DVCs is that

Accepted Answer

A) the most important factor affecting population growth in DVCs is per capita consumption of energy. 
B) unemployment and underemployment are the major sources of population growth in DVCs. 
C) reduced birth rates must come first in DVCs, and then higher per capita incomes will follow. 
D) higher per capita incomes must come first in DVCs, and then reduced birth rates will follow. 
A) the most important factor affecting population growth in DVCs is per capita consumption of energy. 
B) unemployment and underemployment are the major sources of population growth in DVCs. 
C) reduced birth rates must come first in DVCs, and then higher per capita incomes will follow. 
D) higher per capita incomes must come first in DVCs, and then reduced birth rates will follow.

Exam 19: The Economics of Developing Countries

One major path that leads to growth in both developing nations (DVCs) as well industrially advanced nations (IACs) is that productive resources must be

In recent decades,

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

One of the major objectives of the World Bank is to

The diversion of surplus labor in agriculture to the production of schools or roads in developing countries is described as

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

Many of the major projects of the World Bank have been for

The primary function of the International Finance Corporation (IFC) is to

Many countries remain poor because they currently are poor.This statement summarizes the

Capital flight from the DVCs may be caused by

The capricious universe view is the idea that the IACs are exploiting the DVCs.

Capital flight is a problem facing DVCs that involves the

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

The traditional view regarding population and growth in DVCs is that

Part A: Limits, Alternatives, and Choices

Part B: Limits, Alternatives, and Choices

Part A: The Market System and the Circular Flow

Part B: The Market System and the Circular Flow

Part A: Demand, Supply, and Market Equilibrium

Part B: Demand, Supply, and Market Equilibrium

Part A: Market Failures: Public Goods and Externalities

Part B: Market Failures: Public Goods and Externalities

Part A: Governments Role and Government Failure

Part B: Governments Role and Government Failure

Part A: An Introduction to Macroeconomics

Part B: An Introduction to Macroeconomics

Part A: Measuring the Economys Output

Part B: Measuring the Economys Output

Part A: Economic Growth

Part B: Economic Growth

Part A: Business Cycles, Unemployment, and Inflation

Part B: Business Cycles, Unemployment, and Inflation

Part A: Basic Macroeconomic Relationships

Part B: Basic Macroeconomic Relationships

Part A: The Aggregate Expenditures Model

Part B: The Aggregate Expenditures Model

Part A: Aggregate Demand and Aggregate Supply

Part B: Aggregate Demand and Aggregate Supply

Part A: Fiscal Policy, Deficits, Surpluses, and Debt

Part B: Fiscal Policy, Deficits, Surpluses, and Debt

Part A: Money, Banking, and Money Creation

Part B: Money, Banking, and Money Creation

Part A: Interest Rates and Monetary Policy

Part B: Interest Rates and Monetary Policy

Part A: Long-Run Macroeconomic Adjustments

Part B: Long-Run Macroeconomic Adjustments

Part A: International Trade

Part B: International Trade

Part C: Financial Economics

Part A: The Balance of Payments and Exchange Rates

Part B: The Balance of Payments and Exchange Rates

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