Question 1

The richest 20% of the world's population receives more than 80% of the world's income while the poorest 20% receives less than 2% of the world's income.

Accepted Answer

A) True 
 B)False  True

Question 2

Surplus agricultural labor in a developing nation usually means that there is:

Accepted Answer

A)  A caste system 
B)  Widespread under-employment 
C)  Immobility of labor resources 
D)  Increased investment in agriculture 
A)  A caste system 
B)  Widespread under-employment 
C)  Immobility of labor resources 
D)  Increased investment in agriculture B

Question 3

Income gains in the poorest DVCs may increase population growth initially, at least for a while, due to the following reasons, except:

Accepted Answer

A)  Declining death rates 
B)  Increasing birth rates 
C)  Reduced infant mortality 
D)  Decreasing life expectancy 
A)  Declining death rates 
B)  Increasing birth rates 
C)  Reduced infant mortality 
D)  Decreasing life expectancy D

Question 4

Which of the following IACs (industrially advanced countries) was the leading provider of development assistance to DVCs (developing countries) in 2012, in terms of absolute dollar amounts?

Accepted Answer

A)  United States 
B)  Japan 
C)  Canada 
D)  Germany 
A)  United States 
B)  Japan 
C)  Canada 
D)  Germany

Question 5

Birth- and population-control efforts in many DVCs (developing countries) face the following obstacles, except:

Accepted Answer

A)  Low literacy rates 
B)  Religious reasons 
C)  Peasant agriculture view about children 
D)  Government authorities 
A)  Low literacy rates 
B)  Religious reasons 
C)  Peasant agriculture view about children 
D)  Government authorities

Question 6

The demographic transition view of population growth believes that slower population growth will lead to rising incomes.

Accepted Answer

A) True 
 B)False

Question 7

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 flourish 
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 flourish

Question 8

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 9

Per capita income in the United States in 2010 was about:

Accepted Answer

A)  $25,300 per person 
B)  $36,300 per person 
C)  $47,300 per person 
D)  $59,300 per person 
A)  $25,300 per person 
B)  $36,300 per person 
C)  $47,300 per person 
D)  $59,300 per person

Question 10

Development economists suggest that the best strategy for the poorest DVCs to break out of their poverty is to implement policies that boost their:

Accepted Answer

A)  Population growth for a greater labor supply 
B)  Output and slow down their population growth 
C)  Birth rates to expand their available resources 
D)  Mortality rates to slow down their population growth 
A)  Population growth for a greater labor supply 
B)  Output and slow down their population growth 
C)  Birth rates to expand their available resources 
D)  Mortality rates to slow down their population growth

Question 11

Developing countries (DVCs) can be subdivided into the following groups, except:

Accepted Answer

A)  Low-income economies 
B)  High-income economies 
C)  Lower-middle-income economies 
D)  Upper-middle-income economies 
A)  Low-income economies 
B)  High-income economies 
C)  Lower-middle-income economies 
D)  Upper-middle-income economies

Question 12

One common measure of the "standard of living" in a nation is:

Accepted Answer

A)  Per capita real income 
B)  Unemployment rate 
C)  Real GDP 
D)  Population size 
A)  Per capita real income 
B)  Unemployment rate 
C)  Real GDP 
D)  Population size

Question 13

Which of the following is a major obstacle to economic growth in DVCs?

Accepted Answer

A)  A fall in population growth 
B)  A decline in demographic transition 
C)  The low demand for natural resources 
D)  The low supply of saving 
A)  A fall in population growth 
B)  A decline in demographic transition 
C)  The low demand for natural resources 
D)  The low supply of saving

Question 14

One effective way that IACs can help DVCs is to lower trade barriers on products produced by DVCs.

Accepted Answer

A) True 
 B)False

Question 15

To stimulate economic growth, it would be best if developing countries adopted policies to:

Accepted Answer

A)  Discourage foreign investment 
B)  Subsidize state industries 
C)  Build more human capital 
D)  Increase population growth 
A)  Discourage foreign investment 
B)  Subsidize state industries 
C)  Build more human capital 
D)  Increase population growth

Question 16

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 17

Which of the following countries had the highest per capita income in 2010?

Accepted Answer

A)  China 
B)  United States 
C)  Japan 
D)  Germany 
A)  China 
B)  United States 
C)  Japan 
D)  Germany

Question 18

A reason for placing special emphasis on capital accumulation in developing countries is the high:

Accepted Answer

A)  Level of adult illiteracy 
B)  Productivity of workers in DVCs 
C)  Marginal benefits of capital goods 
D)  Level of import quotas and tariffs 
A)  Level of adult illiteracy 
B)  Productivity of workers in DVCs 
C)  Marginal benefits of capital goods 
D)  Level of import quotas and tariffs

Question 19

Which of the following nations is not considered an industrially advanced country?

Accepted Answer

A)  Russia 
B)  Japan 
C)  Canada 
D)  Australia 
A)  Russia 
B)  Japan 
C)  Canada 
D)  Australia

Question 20

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 
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

Exam 22: The Economics of Developing Countries

The richest 20% of the world's population receives more than 80% of the world's income while the poorest 20% receives less than 2% of the world's income.

Surplus agricultural labor in a developing nation usually means that there is:

Income gains in the poorest DVCs may increase population growth initially, at least for a while, due to the following reasons, except:

Which of the following IACs (industrially advanced countries) was the leading provider of development assistance to DVCs (developing countries) in 2012, in terms of absolute dollar amounts?

Birth- and population-control efforts in many DVCs (developing countries) face the following obstacles, except:

The demographic transition view of population growth believes that slower population growth will lead to rising incomes.

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?

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

Per capita income in the United States in 2010 was about:

Development economists suggest that the best strategy for the poorest DVCs to break out of their poverty is to implement policies that boost their:

Developing countries (DVCs) can be subdivided into the following groups, except:

One common measure of the "standard of living" in a nation is:

Which of the following is a major obstacle to economic growth in DVCs?

One effective way that IACs can help DVCs is to lower trade barriers on products produced by DVCs.

To stimulate economic growth, it would be best if developing countries adopted policies to:

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

Which of the following countries had the highest per capita income in 2010?

A reason for placing special emphasis on capital accumulation in developing countries is the high:

Which of the following nations is not considered an industrially advanced country?

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

Limits, Alternatives, and Choices

The Market System and the Circular Flow

Demand, Supply, and Market Equilibrium

Market Failures: Public Goods and Externalities

Governments Role and Government Failure

An Introduction to Macroeconomics

Measuring Domestic Output and National Income

Economic Growth

Business Cycles, Unemployment, and Inflation

Basic Macroeconomic Relationships

The Aggregate Expenditures Model

Aggregate Demand and Aggregate Supply

Fiscal Policy, Deficits, and Debt

Money, Banking, and Financial Institutions

Money Creation

Interest Rates and Monetary Policy

Financial Economics

Extending the Analysis of Aggregate Supply

Current Issues in Macro Theory and Policy

International Trade

The Balance of Payments, Exchange Rates, and Trade Deficits

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