Question 1

The major advantage of a market economy is that

Accepted Answer

A)  it maximizes the need for resource-flow data 
B)  prices convey most of the information necessary to coordinate economic activity among firms 
C)  data are aimed at central planners 
D)  prices are essentially meaningless 
E)  All of the answers are correct 
A)  it maximizes the need for resource-flow data 
B)  prices convey most of the information necessary to coordinate economic activity among firms 
C)  data are aimed at central planners 
D)  prices are essentially meaningless 
E)  All of the answers are correct

Question 2

Which of the following is true?

Accepted Answer

A)  In low-income countries,less than 5 percent of those 15 and older were illiterate during the period 2000 to 2004 
B)  In middle-income countries,10 percent of those 15 and older were illiterate during the period 2000 to 2004 
C)  In high-income countries,38 percent of those 15 and older were illiterate during the period 2000 to 2004 
D)  In the low-income economies of Burundi and Pakistan,about half of students complete ninth grade 
E)  In the middle-income economies of Brazil and Mexico,only about one quarter of students complete ninth grade 
A)  In low-income countries,less than 5 percent of those 15 and older were illiterate during the period 2000 to 2004 
B)  In middle-income countries,10 percent of those 15 and older were illiterate during the period 2000 to 2004 
C)  In high-income countries,38 percent of those 15 and older were illiterate during the period 2000 to 2004 
D)  In the low-income economies of Burundi and Pakistan,about half of students complete ninth grade 
E)  In the middle-income economies of Brazil and Mexico,only about one quarter of students complete ninth grade

Question 3

If the country of Zorg has a birth rate of greater than 2.2 births per woman,it is likely that Zorg is an industrial market country.

Accepted Answer

A) True 
 B)False

Question 4

How many countries in the world have failed to come up with the rules of the game that lead to sustained economic growth?

Accepted Answer

A)  none 
B)  most 
C)  half 
D)  one 
E)  There is not enough data to answer this question 
A)  none 
B)  most 
C)  half 
D)  one 
E)  There is not enough data to answer this question

Question 5

When foreign aid is tied to purchases of low-priced food from the donor country,farm prices can drop in the developing countries,hurting poor farmers.

Accepted Answer

A) True 
 B)False

Question 6

A World Bank study suggest a strong link in Africa between governments that _____ special-interest groups and _____ rates of economic growth.

Accepted Answer

A)  cater to,high 
B)  cater to,moderate 
C)  cater to,low 
D)  ignore,low 
E)  ignore,moderate 
A)  cater to,high 
B)  cater to,moderate 
C)  cater to,low 
D)  ignore,low 
E)  ignore,moderate

Question 7

Any international transfer made on concessional terms for the purposes of promoting economic development is

Accepted Answer

A)  foreign aid 
B)  first aid 
C)  immigration 
D)  private investment 
E)  remittances 
A)  foreign aid 
B)  first aid 
C)  immigration 
D)  private investment 
E)  remittances

Question 8

Sjen Mavago,the economics minister of the country of X-Marks-the-Spot,has concluded that entrepreneurs are unable to generate the kind of growth the country needs.Her decision to create state enterprises might be motivated by the desire to

Accepted Answer

A)  earn profit 
B)  provide jobs for friends and relatives of government officials 
C)  take risks 
D)  encourage a free market 
E)  limit government's role in the economy 
A)  earn profit 
B)  provide jobs for friends and relatives of government officials 
C)  take risks 
D)  encourage a free market 
E)  limit government's role in the economy

Question 9

Developing countries

Accepted Answer

A)  do not benefit from foreign aid 
B)  do not benefit from private investment 
C)  generate less than half of their annual flow of foreign exchange from exports 
D)  must acquire foreign exchange in order to pay for imports 
E)  need to decrease labor productivity 
A)  do not benefit from foreign aid 
B)  do not benefit from private investment 
C)  generate less than half of their annual flow of foreign exchange from exports 
D)  must acquire foreign exchange in order to pay for imports 
E)  need to decrease labor productivity

Question 10

A problem for developing countries is that the prices of primary products fluctuate more widely than do the prices of finished goods because

Accepted Answer

A)  crop supply changes very little despite the weather 
B)  crop supply fluctuates with the weather 
C)  weather never varies 
D)  crops go in and out of fashion as new diets are developed 
E)  crop demand fluctuates with the weather 
A)  crop supply changes very little despite the weather 
B)  crop supply fluctuates with the weather 
C)  weather never varies 
D)  crops go in and out of fashion as new diets are developed 
E)  crop demand fluctuates with the weather

Question 11

Which of the following resources is necessary to combine efficiently the other resources to produce goods and services?

Accepted Answer

A)  natural resources 
B)  capital 
C)  labor 
D)  entrepreneurial ability 
E)  financial institutions 
A)  natural resources 
B)  capital 
C)  labor 
D)  entrepreneurial ability 
E)  financial institutions

Question 12

One thing that did not happen in the former Soviet Union was

Accepted Answer

A)  widespread corruption 
B)  a lack of faith in formal institutions 
C)  workers bribing officials to get good jobs 
D)  consumers paying fair market prices to get desired products 
E)  prices not being allowed to allocate resources efficiently 
A)  widespread corruption 
B)  a lack of faith in formal institutions 
C)  workers bribing officials to get good jobs 
D)  consumers paying fair market prices to get desired products 
E)  prices not being allowed to allocate resources efficiently

Question 13

In a system of impersonal exchange,

Accepted Answer

A)  bureaucratic ties on the production side are critical 
B)  the economy benefits from specialization and modern technology 
C)  inside connections on the consumption side are necessary 
D)  successful institutional evolution makes no difference 
E)  there is very little division of labor 
A)  bureaucratic ties on the production side are critical 
B)  the economy benefits from specialization and modern technology 
C)  inside connections on the consumption side are necessary 
D)  successful institutional evolution makes no difference 
E)  there is very little division of labor

Question 14

If the country of Deficitland is experiencing trade deficits,they are more likely to cut imports of

Accepted Answer

A)  beef 
B)  cocoa 
C)  coffee 
D)  capital goods 
E)  soybeans 
A)  beef 
B)  cocoa 
C)  coffee 
D)  capital goods 
E)  soybeans

Question 15

A requirement for development is

Accepted Answer

A)  an unreliable system of financial institutions 
B)  a lack of saving by households and firms 
C)  low confidence in domestic currency 
D)  low and predictable inflation that encourages saving 
E)  None of the answers is correct 
A)  an unreliable system of financial institutions 
B)  a lack of saving by households and firms 
C)  low confidence in domestic currency 
D)  low and predictable inflation that encourages saving 
E)  None of the answers is correct

Question 16

If there is a great deal of violence and uncertainty in the country of Crazico,people will be less willing to invest in their own future or in the future of Crazico.

Accepted Answer

A) True 
 B)False

Question 17

Which of the following groups has the highest infant mortality rate?

Accepted Answer

A)  middle-income economies 
B)  low-income economies 
C)  high-income economies 
D)  Western European economies 
E)  all the world's economies 
A)  middle-income economies 
B)  low-income economies 
C)  high-income economies 
D)  Western European economies 
E)  all the world's economies

Question 18

In the developing country of Sixsigma,most likely

Accepted Answer

A)  resource owners tend to supply their resources where are most valued 
B)  almost all workers are employed in service industries 
C)  links to family or clan are totally unimportant 
D)  children are expected to choose occupations as different as possible from their parents' occupations 
E)  family businesses resist growth to avoid having to hire people from outside the family 
A)  resource owners tend to supply their resources where are most valued 
B)  almost all workers are employed in service industries 
C)  links to family or clan are totally unimportant 
D)  children are expected to choose occupations as different as possible from their parents' occupations 
E)  family businesses resist growth to avoid having to hire people from outside the family

Question 19

Lessons about the nature of economic processes will likely emerge from the analysis of transitional economies.

Accepted Answer

A) True 
 B)False

Question 20

Countries with reliable phone service have difficulty not only communicating,but also reaping the benefits of other technology advances,such as the Internet.

Accepted Answer

A) True 
 B)False

Exam 21: Developing and Transitional Economies

The major advantage of a market economy is that

Which of the following is true?

If the country of Zorg has a birth rate of greater than 2.2 births per woman,it is likely that Zorg is an industrial market country.

How many countries in the world have failed to come up with the rules of the game that lead to sustained economic growth?

When foreign aid is tied to purchases of low-priced food from the donor country,farm prices can drop in the developing countries,hurting poor farmers.

A World Bank study suggest a strong link in Africa between governments that _____ special-interest groups and _____ rates of economic growth.

Any international transfer made on concessional terms for the purposes of promoting economic development is

Sjen Mavago,the economics minister of the country of X-Marks-the-Spot,has concluded that entrepreneurs are unable to generate the kind of growth the country needs.Her decision to create state enterprises might be motivated by the desire to

Developing countries

A problem for developing countries is that the prices of primary products fluctuate more widely than do the prices of finished goods because

Which of the following resources is necessary to combine efficiently the other resources to produce goods and services?

One thing that did not happen in the former Soviet Union was

In a system of impersonal exchange,

If the country of Deficitland is experiencing trade deficits,they are more likely to cut imports of

A requirement for development is

If there is a great deal of violence and uncertainty in the country of Crazico,people will be less willing to invest in their own future or in the future of Crazico.

Which of the following groups has the highest infant mortality rate?

In the developing country of Sixsigma,most likely

Lessons about the nature of economic processes will likely emerge from the analysis of transitional economies.

Countries with reliable phone service have difficulty not only communicating,but also reaping the benefits of other technology advances,such as the Internet.

The Art and Science of Economic Analysis

Economic Tools and Economics Systems

Economic Decision Makers

Demand, supply, and Markets

Elasticity of Demand and Supply

Consumer Choice and Demand

Production and Cost in the Firm

Perfect Competition

Amonopoly

Monopolistic Competition and Oligopoly

Resource Markets

Labor Markets and Labor Unions

Capital, interest, and Corporate Finance

Transaction Costs, imperfect Information, and Market Behavior

Economic Regulation and Antitrust Policy

Public Goods and Public Choice

Externalities and the Environment

Income Distribution and Poverty

International Trade

International Finance

Filters

A World Bank study suggest a strong link in Africa between governments that _ special-interest groups and _ rates of economic growth.