Question 1

Without an abundant endowment of natural resources, a nation cannot achieve rapid economic growth.

Accepted Answer

A) True 
 B)False

Question 2

The corruption and poor administration that are common to the public sectors of many DVCs suggest that government may not be very effective in promoting economic growth.

Accepted Answer

A) True 
 B)False

Question 3

The low per capita outputs of the DVCs are explained by

Accepted Answer

A) insufficient saving and investment. 
B) overinvestment in human capital. 
C) slow population growth. 
D) excessively rapid technological advance. 
A) insufficient saving and investment. 
B) overinvestment in human capital. 
C) slow population growth. 
D) excessively rapid technological advance.

Question 4

What measure of economic development is used most often to classify nations as industrially advanced or as developing?

Accepted Answer

A) per capita income 
B) life expectancy at birth 
C) per capita energy consumption 
D) daily per capita calorie supply 
A) per capita income 
B) life expectancy at birth 
C) per capita energy consumption 
D) daily per capita calorie supply

Question 5

Population expansion can impede economic development for the following reasons except

Accepted Answer

A) reduced saving and investment rates. 
B) reduced productivity of labor. 
C) a larger supply of labor. 
D) its contribution to urban congestion and problems. 
A) reduced saving and investment rates. 
B) reduced productivity of labor. 
C) a larger supply of labor. 
D) its contribution to urban congestion and problems.

Question 6

A factor that limits the amount of saving in developing countries is the fact that

Accepted Answer

A) the banking system does not encourage saving. 
B) there is too much foreign aid, so savings is not needed. 
C) the level of aggregate domestic output is low. 
D) the government controls financial institutions and makes it difficult for people to save. 
A) the banking system does not encourage saving. 
B) there is too much foreign aid, so savings is not needed. 
C) the level of aggregate domestic output is low. 
D) the government controls financial institutions and makes it difficult for people to save.

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

If the real output of a DVC increases from $200 billion to $260 billion and its population increases from 100 to 120 million, its real per capita output will have

Accepted Answer

A) remained unchanged. 
B) increased by about $167. 
C) increased by about $55. 
D) decreased by about $20. 
A) remained unchanged. 
B) increased by about $167. 
C) increased by about $55. 
D) decreased by about $20.

Question 9

Land reform (or the reform of land ownership) is a relatively minor institutional obstacle to economic growth in many developing countries.

Accepted Answer

A) True 
 B)False

Question 10

The industrially advanced nations can assist developing nations by reducing trade barriers and by providing both private and public capital.

Accepted Answer

A) True 
 B)False

Question 11

The demographic transition view of population growth argues that, on average (and as perceived by parents), the marginal

Accepted Answer

A) benefits of extra children are larger in IACs than in DVCs. 
B) costs of extra children are lower in IACs than in DVCs. 
C) costs of extra children are larger in IACs than in DVCs. 
D) benefits of extra children are the same in DVCs and IACs. 
A) benefits of extra children are larger in IACs than in DVCs. 
B) costs of extra children are lower in IACs than in DVCs. 
C) costs of extra children are larger in IACs than in DVCs. 
D) benefits of extra children are the same in DVCs and IACs.

Question 12

Which of the following is not a characteristic of human resources in the poorest DVCs?

Accepted Answer

A) Populations are large. 
B) Unemployment and underemployment are widespread. 
C) Population growth is low. 
D) Labor productivity is low. 
A) Populations are large. 
B) Unemployment and underemployment are widespread. 
C) Population growth is low. 
D) Labor productivity is low.

Question 13

Which characteristic is most typical of human resources in developing nations?

Accepted Answer

A) a small population base 
B) low unemployment in urban areas 
C) low unemployment in rural areas 
D) high unemployment in urban areas 
A) a small population base 
B) low unemployment in urban areas 
C) low unemployment in rural areas 
D) high unemployment in urban areas

Question 14

Which of the following countries had the highest population density (population per square km) in 2014?

Accepted Answer

A) United States 
B) India 
C) China 
D) Venezuela 
A) United States 
B) India 
C) China 
D) Venezuela

Question 15

Which of these sets of nations consists of high-income economies?

Accepted Answer

A) Brazil, Thailand, and South Africa 
B) China, India, and Russia 
C) Canada, Switzerland, and France 
D) United States, South Korea, and Mexico 
A) Brazil, Thailand, and South Africa 
B) China, India, and Russia 
C) Canada, Switzerland, and France 
D) United States, South Korea, and Mexico

Question 16

An increasing share of the private capital flows to DVCs in recent years has been in the form of

Accepted Answer

A) interest-free government loans. 
B) educational and training assistance. 
C) direct foreign investment. 
D) bank loans. 
A) interest-free government loans. 
B) educational and training assistance. 
C) direct foreign investment. 
D) bank loans.

Question 17

One of the essential paths to economic growth is

Accepted Answer

A) increasing population growth. 
B) expanding the role of government. 
C) using existing resources more efficiently. 
D) expanding tax credits for business investment. 
A) increasing population growth. 
B) expanding the role of government. 
C) using existing resources more efficiently. 
D) expanding tax credits for business investment.

Question 18

Infrastructure is best illustrated by

Accepted Answer

A) farm equipment. 
B) school buildings and highways. 
C) machinery and equipment for the production of consumer goods. 
D) government tax revenues. 
A) farm equipment. 
B) school buildings and highways. 
C) machinery and equipment for the production of consumer goods. 
D) government tax revenues.

Question 19

An institutional change that is needed in most developing nations is

Accepted Answer

A) the will to develop. 
B) reduced foreign aid. 
C) birth control. 
D) land reform. 
A) the will to develop. 
B) reduced foreign aid. 
C) birth control. 
D) land reform.

Question 20

An advantage of direct foreign investment (compared to foreign loans) is that management skill and technological knowledge often accompany such capital flows.

Accepted Answer

A) True 
 B)False

Exam 19: The Economics of Developing Countries

Without an abundant endowment of natural resources, a nation cannot achieve rapid economic growth.

The corruption and poor administration that are common to the public sectors of many DVCs suggest that government may not be very effective in promoting economic growth.

The low per capita outputs of the DVCs are explained by

What measure of economic development is used most often to classify nations as industrially advanced or as developing?

Population expansion can impede economic development for the following reasons except

A factor that limits the amount of saving in developing countries is the fact that

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

If the real output of a DVC increases from $200 billion to $260 billion and its population increases from 100 to 120 million, its real per capita output will have

Land reform (or the reform of land ownership) is a relatively minor institutional obstacle to economic growth in many developing countries.

The industrially advanced nations can assist developing nations by reducing trade barriers and by providing both private and public capital.

The demographic transition view of population growth argues that, on average (and as perceived by parents), the marginal

Which of the following is not a characteristic of human resources in the poorest DVCs?

Which characteristic is most typical of human resources in developing nations?

Which of the following countries had the highest population density (population per square km) in 2014?

Which of these sets of nations consists of high-income economies?

An increasing share of the private capital flows to DVCs in recent years has been in the form of

One of the essential paths to economic growth is

Infrastructure is best illustrated by

An institutional change that is needed in most developing nations is

An advantage of direct foreign investment (compared to foreign loans) is that management skill and technological knowledge often accompany such capital flows.

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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