Question 1

Countries with a high level of human capital can make up for other shortcomings, such as destruction caused due to war.

Accepted Answer

A) True 
 B)False  True

Question 2

​Which of the following is true of bilateral funding?

Accepted Answer

A) It is provided by the World Bank only. 
B) It is tied to the purchase of goods and services from donor countries. 
C) It includes grants and loans that are extended at very high interest rates. 
D) It is provided by the International Monetary Fund only. 
E) It is provided by philanthropic organizations. 
A) It is provided by the World Bank only. 
B) It is tied to the purchase of goods and services from donor countries. 
C) It includes grants and loans that are extended at very high interest rates. 
D) It is provided by the International Monetary Fund only. 
E) It is provided by philanthropic organizations. B

Question 3

​_____ is one of the clearest ways of distinguishing between industrial and developing countries.

Accepted Answer

A) The interest rate 
B) The birth rate 
C) The enrolment rate 
D) The number of skyscrapers 
E) The composition of the population 
A) The interest rate 
B) The birth rate 
C) The enrolment rate 
D) The number of skyscrapers 
E) The composition of the population B

Question 4

​Which of the following is an example of multilateral transfer?

Accepted Answer

A) The United States providing manufactured goods at low prices to a developing country in Africa 
B) The United States supplying medicines and other healthcare equipment to Botswana 
C) The World Bank providing finance to help build communication networks in a developing country 
D) China helping to finance and build telephone lines in East Africa 
E) England providing educational assistance to a developing country 
A) The United States providing manufactured goods at low prices to a developing country in Africa 
B) The United States supplying medicines and other healthcare equipment to Botswana 
C) The World Bank providing finance to help build communication networks in a developing country 
D) China helping to finance and build telephone lines in East Africa 
E) England providing educational assistance to a developing country

Question 5

​It is clear that foreign aid is a source of discretionary funds that _____.

Accepted Answer

A) benefit only the poor people 
B) benefit government leaders 
C) benefit only rich people 
D) benefit institutions like the World Bank and the IMF 
E) benefit all common people irrespective of their economic status 
A) benefit only the poor people 
B) benefit government leaders 
C) benefit only rich people 
D) benefit institutions like the World Bank and the IMF 
E) benefit all common people irrespective of their economic status

Question 6

​The bulk of exports from developing countries is:

Accepted Answer

A) manufactured goods. 
B) primary products. 
C) services. 
D) intermediate goods only. 
E) capital equipment only. 
A) manufactured goods. 
B) primary products. 
C) services. 
D) intermediate goods only. 
E) capital equipment only.

Question 7

​Gloria, who lives in a developing country, is likely to:

Accepted Answer

A) be less educated than most men in her country. 
B) be a graduate and her brother is likely to be a school dropout. 
C) have more employment opportunities and earn higher wages than her male classmates. 
D) work long hours on her farmland. 
E) have special access to resources such as land, capital, and technology. 
A) be less educated than most men in her country. 
B) be a graduate and her brother is likely to be a school dropout. 
C) have more employment opportunities and earn higher wages than her male classmates. 
D) work long hours on her farmland. 
E) have special access to resources such as land, capital, and technology.

Question 8

An aging population poses fiscal problems for any country.

Accepted Answer

A) True 
 B)False

Question 9

​When a developing country relies on import substitution, _____.

Accepted Answer

A) it capitalizes on the gains from specialization and comparative advantage 
B) it replaces high-cost domestic goods with low-cost foreign goods. 
C) domestic producers, shielded from foreign competition, usually become more efficient. 
D) other countries often retaliate with their own trade restrictions 
E) it concentrates on producing only for the international market. 
A) it capitalizes on the gains from specialization and comparative advantage 
B) it replaces high-cost domestic goods with low-cost foreign goods. 
C) domestic producers, shielded from foreign competition, usually become more efficient. 
D) other countries often retaliate with their own trade restrictions 
E) it concentrates on producing only for the international market.

Question 10

​Which of the following is a consequence of low income?

Accepted Answer

A) More hard work and lower labor productivity 
B) More investment in human capital 
C) More savings and less consumption 
D) More hard work and higher labor productivity 
E) Less savings and less investment 
A) More hard work and lower labor productivity 
B) More investment in human capital 
C) More savings and less consumption 
D) More hard work and higher labor productivity 
E) Less savings and less investment

Question 11

​Which of the following strategies emphasizes free trade?

Accepted Answer

A) Nationalization of industries 
B) Promotion of exports 
C) Higher export tariff 
D) Higher import tariff 
E) Higher quota restriction 
A) Nationalization of industries 
B) Promotion of exports 
C) Higher export tariff 
D) Higher import tariff 
E) Higher quota restriction

Question 12

Which of the following regions has the lowest life expectancy at birth?​

Accepted Answer

A) Continental European countries 
B) The Baltic countries 
C) The Nordic countries 
D) Sub-Saharan African countries 
E) Middle Eastern countries 
A) Continental European countries 
B) The Baltic countries 
C) The Nordic countries 
D) Sub-Saharan African countries 
E) Middle Eastern countries

Question 13

​Which of the following is true?

Accepted Answer

A) In low-income countries, less than 5 percent of those 15 and older were illiterate in 2007. 
B) In middle-income countries, 17 percent of those 15 and older were illiterate in 2007. 
C) In high-income countries, 38 percent of those 15 and older were illiterate in 2007. 
D) Education bears little relationship to economic development in high-income countries. 
E) Education is more important to the economic development of low-income countries than it is to high-income countries. 
A) In low-income countries, less than 5 percent of those 15 and older were illiterate in 2007. 
B) In middle-income countries, 17 percent of those 15 and older were illiterate in 2007. 
C) In high-income countries, 38 percent of those 15 and older were illiterate in 2007. 
D) Education bears little relationship to economic development in high-income countries. 
E) Education is more important to the economic development of low-income countries than it is to high-income countries.

Question 14

​Some recipient governments sold the food they received from the U.S. Food for Peace program to _____.

Accepted Answer

A) earn more foreign exchange 
B) finance poorly conceived projects 
C) finance the import of industrial finished products 
D) finance their defense expenses 
E) finance their import of software services 
A) earn more foreign exchange 
B) finance poorly conceived projects 
C) finance the import of industrial finished products 
D) finance their defense expenses 
E) finance their import of software services

Question 15

​Evidence from developing countries suggests that fertility rates decline when _____.

Accepted Answer

A) households are headed by women 
B) the composition of children in the population exceeds the young adults 
C) households are headed by men 
D) literacy among women declines 
E) women have employment opportunities outside their home. 
A) households are headed by women 
B) the composition of children in the population exceeds the young adults 
C) households are headed by men 
D) literacy among women declines 
E) women have employment opportunities outside their home.

Question 16

​Which of the following is true of the agricultural sector in developing countries?

Accepted Answer

A) A very small percentage of labor force is employed in agriculture. ​ 
B) Farm productivity is usually very low. 
C) It relies heavily on technology. 
D) It does not contribute to the exports of the countries. 
E) It accounts for a high percentage of the national income. 
A) A very small percentage of labor force is employed in agriculture. ​ 
B) Farm productivity is usually very low. 
C) It relies heavily on technology. 
D) It does not contribute to the exports of the countries. 
E) It accounts for a high percentage of the national income.

Question 17

​Developing countries have higher birth rates because:

Accepted Answer

A) families with more children have higher levels of income. 
B) children are viewed as economic and social security as parents age. 
C) the opportunity cost of leisure for people in developing countries is less. 
D) there are special government programs that encourage more children per family. 
E) the infant mortality rate is low in developing countries. 
A) families with more children have higher levels of income. 
B) children are viewed as economic and social security as parents age. 
C) the opportunity cost of leisure for people in developing countries is less. 
D) there are special government programs that encourage more children per family. 
E) the infant mortality rate is low in developing countries.

Question 18

​Many developing countries were once under colonial rule, a system of government that:

Accepted Answer

A) offered the local population large opportunities to develop entrepreneurial skills. 
B) offered the local population fewer opportunities to develop entrepreneurial skills. 
C) did not offer any opportunity to the local population to develop entrepreneurial skills. 
D) believed in a free-market economy. 
E) offered immigrants opportunities to become entrepreneurs. 
A) offered the local population large opportunities to develop entrepreneurial skills. 
B) offered the local population fewer opportunities to develop entrepreneurial skills. 
C) did not offer any opportunity to the local population to develop entrepreneurial skills. 
D) believed in a free-market economy. 
E) offered immigrants opportunities to become entrepreneurs.

Question 19

​A disadvantage of foreign aid is that:

Accepted Answer

A) it leads to a decline in the standard of living in donor countries. 
B) it leads to the disinvestment of public sector industries in the recipient countries. 
C) the agricultural sectors of recipient countries experience surplus output. 
D) government officials are insulated from their own incompetence. 
E) it leads to hyperinflation in the recipient countries. 
A) it leads to a decline in the standard of living in donor countries. 
B) it leads to the disinvestment of public sector industries in the recipient countries. 
C) the agricultural sectors of recipient countries experience surplus output. 
D) government officials are insulated from their own incompetence. 
E) it leads to hyperinflation in the recipient countries.

Question 20

​Country-to-country aid is called _____.

Accepted Answer

A) unilateral assistance 
B) multilateral assistance 
C) bilateral assistance 
D) remittance 
E) government transfer 
A) unilateral assistance 
B) multilateral assistance 
C) bilateral assistance 
D) remittance 
E) government transfer

Exam 21: Economic Development

Countries with a high level of human capital can make up for other shortcomings, such as destruction caused due to war.

​Which of the following is true of bilateral funding?

​_____ is one of the clearest ways of distinguishing between industrial and developing countries.

​Which of the following is an example of multilateral transfer?

​It is clear that foreign aid is a source of discretionary funds that _____.

​The bulk of exports from developing countries is:

​Gloria, who lives in a developing country, is likely to:

An aging population poses fiscal problems for any country.

​When a developing country relies on import substitution, _____.

​Which of the following is a consequence of low income?

​Which of the following strategies emphasizes free trade?

Which of the following regions has the lowest life expectancy at birth?​

​Which of the following is true?

​Some recipient governments sold the food they received from the U.S. Food for Peace program to _____.

​Evidence from developing countries suggests that fertility rates decline when _____.

​Which of the following is true of the agricultural sector in developing countries?

​Developing countries have higher birth rates because:

​Many developing countries were once under colonial rule, a system of government that:

​A disadvantage of foreign aid is that:

​Country-to-country aid is called _____.

The Art and Science of Economic Analysis

Economic Tools and Economic 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

Monopoly

Monopolistic Competition and Oligopoly

Resource Markets

Labor Markets and Labor Unions

Capital, Interest, Entrepreneurship, and Corporate Finance

Transaction Costs, Asymmetric Information, and Behavioral Economics

Economic Regulation and Antitrust Policy

Public Goods and Public Choice

Externalities and the Environment

Poverty and Redistribution

International Trade

International Finance

Filters

Which of the following is true of bilateral funding?

_____ is one of the clearest ways of distinguishing between industrial and developing countries.

Which of the following is an example of multilateral transfer?

It is clear that foreign aid is a source of discretionary funds that _____.

The bulk of exports from developing countries is:

Gloria, who lives in a developing country, is likely to:

When a developing country relies on import substitution, _____.

Which of the following is a consequence of low income?

Which of the following strategies emphasizes free trade?

Which of the following regions has the lowest life expectancy at birth?

Which of the following is true?

Some recipient governments sold the food they received from the U.S. Food for Peace program to _____.

Evidence from developing countries suggests that fertility rates decline when _____.

Which of the following is true of the agricultural sector in developing countries?

Developing countries have higher birth rates because:

Many developing countries were once under colonial rule, a system of government that:

A disadvantage of foreign aid is that:

Country-to-country aid is called _____.