Question 1

Characteristics of economic development include all of the following EXCEPT

Accepted Answer

A) improvements in basic education. 
B) an increase in the standard of living. 
C) a decrease in the percentage of the labor force in urban areas. 
D) an increase in life expectancy. 
A) improvements in basic education. 
B) an increase in the standard of living. 
C) a decrease in the percentage of the labor force in urban areas. 
D) an increase in life expectancy. C

Question 2

Market socialism is characterized by collective ownership of firms but market allocation of goods.

Accepted Answer

A) True 
 B)False  True

Question 3

The transition to a market-oriented economy characterized by rising unemployment and higher prices suggests that

Accepted Answer

A) government must continue to centrally plan all resource allocations to production. 
B) a social safety net including unemployment compensation,and food,clothing,and housing subsidies for those in need will be politically popular. 
C) government must set wages,prices,and interest rates. 
D) government must continue to centrally plan the distribution of all output into consumption. 
A) government must continue to centrally plan all resource allocations to production. 
B) a social safety net including unemployment compensation,and food,clothing,and housing subsidies for those in need will be politically popular. 
C) government must set wages,prices,and interest rates. 
D) government must continue to centrally plan the distribution of all output into consumption. B

Question 4

According to the World Bank,in 2006 the smallest population group (810 million people)belonged to countries classified as upper middle-income.

Accepted Answer

A) True 
 B)False

Question 5

Student absenteeism is a problem facing education in the developing world.

Accepted Answer

A) True 
 B)False

Question 6

In 2006,low-income countries had the highest infant mortality rates and lowest literacy rates in the world.

Accepted Answer

A) True 
 B)False

Question 7

Related to the Economics in Practice on p.722: By 2001,the majority of the fishing fleet in the Indian state of Kerala had mobile phones.As a result of the introduction of mobile phone service to this fishing industry,profits ________ and consumer prices ________.

Accepted Answer

A) rose;fell 
B) fell;rose 
C) rose;rose 
D) fell;fell 
A) rose;fell 
B) fell;rose 
C) rose;rose 
D) fell;fell

Question 8

India is a democratic country with a history of rule-of-law and an English speaking heritage,all factors thought to give a development advantage.

Accepted Answer

A) True 
 B)False

Question 9

China and India both have rapidly developing economies.Which of the following characteristics is shared by India and China?

Accepted Answer

A) Both have embraced free-market economies. 
B) Property rights are well established in both countries. 
C) Both are democratic countries. 
D) Both have high literacy rates. 
A) Both have embraced free-market economies. 
B) Property rights are well established in both countries. 
C) Both are democratic countries. 
D) Both have high literacy rates.

Question 10

Advocates of a gradualism transition approach from socialism to a market economy recommend

Accepted Answer

A) moderate changes starting with the development of market institutions,the gradual decontrol of prices,and the privatization of only the cost efficient firms. 
B) continued government controls over wages forever. 
C) an immediate and total change in all economic conditions. 
D) continued government controls over prices forever. 
A) moderate changes starting with the development of market institutions,the gradual decontrol of prices,and the privatization of only the cost efficient firms. 
B) continued government controls over wages forever. 
C) an immediate and total change in all economic conditions. 
D) continued government controls over prices forever.

Question 11

Studies by the World Bank during the 1970s indicate that

Accepted Answer

A) growth in GDP always leads to economic development. 
B) growth in GDP does not guarantee improvements in development indicators. 
C) growth in GDP improves education,nutrition and health. 
D) growth in GDP decreases the GDP per capita. 
A) growth in GDP always leads to economic development. 
B) growth in GDP does not guarantee improvements in development indicators. 
C) growth in GDP improves education,nutrition and health. 
D) growth in GDP decreases the GDP per capita.

Question 12

A "brain drain" is

Accepted Answer

A) the tendency of workers in developing countries to reject new technologies. 
B) the tendency of talented people in developing countries to get education in developed countries and to stay there after graduation. 
C) the impact of poverty on the productivity of workers in developing countries. 
D) the impact of malnutrition on education and productivity in developing countries. 
A) the tendency of workers in developing countries to reject new technologies. 
B) the tendency of talented people in developing countries to get education in developed countries and to stay there after graduation. 
C) the impact of poverty on the productivity of workers in developing countries. 
D) the impact of malnutrition on education and productivity in developing countries.

Question 13

Most authorities agree that the transition to a market economy can be achieved

Accepted Answer

A) without external financial and technical assistance. 
B) only with forceful central planning by the government. 
C) only with external financial and technical assistance. 
D) only with government controls on wages and prices. 
A) without external financial and technical assistance. 
B) only with forceful central planning by the government. 
C) only with external financial and technical assistance. 
D) only with government controls on wages and prices.

Question 14

Economic theories of population growth suggest that fertility decisions made by poor families should be viewed as uninformed and uncontrolled.

Accepted Answer

A) True 
 B)False

Question 15

The Russian transition to a market economy required

Accepted Answer

A) controls over prices. 
B) market-supporting institutions such as a developed banking system,functional financial markets,a code of commercial law,and developed processes for insurability of business activities. 
C) controls over wages and interest rates. 
D) controls planning overall production. 
A) controls over prices. 
B) market-supporting institutions such as a developed banking system,functional financial markets,a code of commercial law,and developed processes for insurability of business activities. 
C) controls over wages and interest rates. 
D) controls planning overall production.

Question 16

Social overhead capital is basic infrastructure projects such as roads,power generation and irrigation systems.

Accepted Answer

A) True 
 B)False

Question 17

Despite India being on the World Bank's list of low-income countries,its capital city,Mumbai,is one of the top ten centers of commerce in the world.

Accepted Answer

A) True 
 B)False

Question 18

Building roads,power generators,and irrigation systems are projects that are referred to as

Accepted Answer

A) social overhead capital. 
B) human capital. 
C) physical capital. 
D) financial capital. 
A) social overhead capital. 
B) human capital. 
C) physical capital. 
D) financial capital.

Question 19

Which of the following factors has been suggested as an explanation for the lack of economic growth in many poor nations?

Accepted Answer

A) insufficient capital formation 
B) the supply of human resources is too high. 
C) inadequate level of resources 
D) a lack of dependence on the already developed nations 
A) insufficient capital formation 
B) the supply of human resources is too high. 
C) inadequate level of resources 
D) a lack of dependence on the already developed nations

Question 20

Statistics show that the less developed a country is

Accepted Answer

A) the larger is the share of industrial output in its total output. 
B) the larger is the share of agricultural output in its total output. 
C) the larger is the per capita income. 
D) the larger is the GDP. 
A) the larger is the share of industrial output in its total output. 
B) the larger is the share of agricultural output in its total output. 
C) the larger is the per capita income. 
D) the larger is the GDP.

Exam 21: Economic Growth in Developing and Transitional Economies

Characteristics of economic development include all of the following EXCEPT

Market socialism is characterized by collective ownership of firms but market allocation of goods.

The transition to a market-oriented economy characterized by rising unemployment and higher prices suggests that

According to the World Bank,in 2006 the smallest population group (810 million people)belonged to countries classified as upper middle-income.

Student absenteeism is a problem facing education in the developing world.

In 2006,low-income countries had the highest infant mortality rates and lowest literacy rates in the world.

Related to the Economics in Practice on p.722: By 2001,the majority of the fishing fleet in the Indian state of Kerala had mobile phones.As a result of the introduction of mobile phone service to this fishing industry,profits ________ and consumer prices ________.

India is a democratic country with a history of rule-of-law and an English speaking heritage,all factors thought to give a development advantage.

China and India both have rapidly developing economies.Which of the following characteristics is shared by India and China?

Advocates of a gradualism transition approach from socialism to a market economy recommend

Studies by the World Bank during the 1970s indicate that

A "brain drain" is

Most authorities agree that the transition to a market economy can be achieved

Economic theories of population growth suggest that fertility decisions made by poor families should be viewed as uninformed and uncontrolled.

The Russian transition to a market economy required

Social overhead capital is basic infrastructure projects such as roads,power generation and irrigation systems.

Despite India being on the World Bank's list of low-income countries,its capital city,Mumbai,is one of the top ten centers of commerce in the world.

Building roads,power generators,and irrigation systems are projects that are referred to as

Which of the following factors has been suggested as an explanation for the lack of economic growth in many poor nations?

Statistics show that the less developed a country is

The Scope and Method of Economics

The Economic Problem: Scarcity and Choice

Demand,supply,and Market Equilibrium

Demand and Supply Applications

Introduction to Macroeconomics

Measuring National Output and National Income

Unemployment, inflation, and Long-Run Growth

Aggregate Expenditure and Equilibrium Output

The Government and Fiscal Policy

The Money Supply and the Federal Reserve System

Money Demand and the Equilibrium Interest Rate

The Determination of Aggregate Output, the Price Level, and the Interest Rate

Policy Effects and Costs Shocks in the Asad Model

The Labor Market in the Macroeconomy

Financial Crises, stabilization, and Deficits

Household and Firm Behavior in the Macroeconomy: a Further Look

Long-Run Growth

Alternative Views in Macroeconomics

International Trade,comparative Advantage,and Protectionism

Open-Economy Macroeconomics: the Balance of Payments and Exchange Rates

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Related to the Economics in Practice on p.722: By 2001,the majority of the fishing fleet in the Indian state of Kerala had mobile phones.As a result of the introduction of mobile phone service to this fishing industry,profits and consumer prices .