Question 1

If the real outputs per capita of a rich nation and a poor nation grow at the same percentage rate, the absolute income gap between the two nations will shrink.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following countries had the best score in the Corruption Perception Index in 2015?

Accepted Answer

A)   Japan
B)   China
C)   United States
D)   CanadaE) All of the above
F) A) and D)

Question 3

Which of the following factors contributes to the weak economic growth in DVCs?

Accepted Answer

A)   an increase in labor productivity in DVCs
B)   a decrease in international debts of DVCs
C)   an increase in the rate of saving in a DVC
D)   a decrease in the prices of DVC natural resourcesE) A) and C)
F) None of the above

Question 4

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

Question 5

An IAC (industrially advanced country)  had a per capita income of $28,200, while a DVC (developing country)  had a per capita income of $1,200 in a given year. If both countries experience a per-capita-income growth of 2 percent, then their respective per-capita-income levels one year later will become

Accepted Answer

A)   $33,840 and $1,440.
B)   $28,764 and $1,224.
C)   $33,840 and $1,224.
D)   $28,764 and $1,440.E) B) and C)
F) B) and D)

Question 6

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

Accepted Answer

A)   Russia
B)   Japan
C)   Canada
D)   AustraliaE) A) and B)
F) None of the above

Question 7

The population growth rate of the DVCs (developing countries)  as a group in recent decades has been

Accepted Answer

A)   steady.
B)   declining.
C)   rising modestly.
D)   rising rapidly.E) B) and C)
F) A) and B)

Question 8

The "brain drain" problem in the DVCs refers to the fact that the best-educated workers

Accepted Answer

A)   are concentrated in the public, rather than the private, sector.
B)   are concentrated in the private, rather than the public, sector.
C)   are concentrated in urban, rather than rural, areas.
D)   have emigrated from the DVCs to the IACs.E) A) and D)
F) All of the above

Question 9

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.E) A) and D)
F) All of the above

Question 10

Most nations of the world are now IACs, not middle- and low-income DVCs.

Accepted Answer

A) True 
 B)False

Question 11

The vast majority of the labor forces of the low-income DVCs are engaged in agriculture.

Accepted Answer

A) True 
 B)False

Question 12

An example of direct foreign investment is

Accepted Answer

A)   a U.S. bank granting a loan to a Guatemalan firm.
B)   General Motors building an auto production facility in China.
C)   a U.S. government foreign aid grant to Bangladesh.
D)   the purchase of debt issued by the Panamanian government.E) A) and B)
F) None of the above

Question 13

The "vicious circle of poverty" for developing nations can best be described by

Accepted Answer

A)   low levels of international trade that reduce exports and increase the dependence on imports.
B)   low incomes that inhibit saving and the accumulation of real and human capital, making it difficult to increase productivity and income.
C)   a large government sector, which reduces the availability of private investment spending but increases macroeconomic stability.
D)   a lack of entrepreneurial talent that limits the formation of businesses and the development of private businesses.E) A) and B)
F) None of the above

Question 14

Examples of low-income developing countries are

Accepted Answer

A)   Switzerland, New Zealand, and Australia.
B)   Germany, Austria, and Italy.
C)   Chad, Bangladesh, and Ethiopia.
D)   Mexico, South Korea, and Brazil.E) A) and B)
F) A) and C)

Question 15

Assume that the real output of a developing nation increases from $120 billion to $140 billion, while its population expands from 100 to 110 million. As a result, real income per capita has increased by about

Accepted Answer

A)   $56 per person.
B)   $64 per person.
C)   $72 per person.
D)   $88 per person.E) C) and D)
F) A) and D)

Question 16

Which of the following is not an example of a sociocultural impediment to economic growth?

Accepted Answer

A)   tribal allegiances that take precedence over national unity
B)   religious beliefs and practices that severely limit economic activity
C)   migration of labor resources from agricultural to urban areas
D)   a system for allocating jobs based on caste or traditionE) C) and D)
F) A) and B)

Question 17

Which of the following DVC policies is not likely to increase DVC economic growth?

Accepted Answer

A)   privatizing state industries
B)   controlling population growth
C)   restricting direct foreign investment from abroad
D)   building human capitalE) None of the above
F) All of the above

Question 18

Which of the following IACs (industrially advanced countries)  was the leading provider of development assistance to DVCs (developing countries)  in 2015, in terms of absolute dollar amounts?

Accepted Answer

A)   United States
B)   Japan
C)   Canada
D)   GermanyE) A) and B)
F) A) and C)

Question 19

Capital flight refers to

Accepted Answer

A)   the tendency of large corporations of IACs to build new plants in the DVCs because labor is cheaper.
B)   DVC citizens accumulating or investing their savings in the IACs.
C)   the high international mobility of speculative funds caused by variations in exchange rates.
D)   the tendency of DVCs to overinvest in commercial aircraft.E) B) and C)
F) A) and D)

Question 20

In recent years, the governments of the IACs have

Accepted Answer

A)   forgiven a portion of the debt owed by some low-income DVCs.
B)   substantially reduced foreign aid to the DVCs.
C)   substantially reduced their contributions to the World Bank.
D)   discouraged skilled DVC workers from emigrating to the IACs.E) A) and C)
F) B) and C)

Exam 28: The Economics of Developing Countries

Capital flight refers to

Correct Answer
verified

Which of the following is not an example of a sociocultural impediment to economic growth?

Correct Answer
verified

Examples of low-income developing countries are

Correct Answer
verified

The "brain drain" problem in the DVCs refers to the fact that the best-educated workers

Correct Answer
verified

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

Correct Answer
verified

Assume that the real output of a developing nation increases from $120 billion to $140 billion, while its population expands from 100 to 110 million. As a result, real income per capita has increased by about

Correct Answer
verified

The "vicious circle of poverty" for developing nations can best be described by

Correct Answer
verified

An example of direct foreign investment is

Correct Answer
verified

The vast majority of the labor forces of the low-income DVCs are engaged in agriculture.

Correct Answer
verified

Which of the following IACs (industrially advanced countries) was the leading provider of development assistance to DVCs (developing countries) in 2015, in terms of absolute dollar amounts?

Correct Answer
verified

In recent years, the governments of the IACs have

Correct Answer
verified

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

Correct Answer
verified

The population growth rate of the DVCs (developing countries) as a group in recent decades has been

Correct Answer
verified

Which of the following DVC policies is not likely to increase DVC economic growth?

Correct Answer
verified

Correct Answer
verified

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

Correct Answer
verified

Which of the following factors contributes to the weak economic growth in DVCs?

Correct Answer
verified

Most nations of the world are now IACs, not middle- and low-income DVCs.

Correct Answer
verified

If the real outputs per capita of a rich nation and a poor nation grow at the same percentage rate, the absolute income gap between the two nations will shrink.

Correct Answer
verified

Which of the following countries had the best score in the Corruption Perception Index in 2015?

Correct Answer
verified

Exam 28: The Economics of Developing Countries

Capital flight refers to

Correct AnswerverifiedShow Answer

Which of the following is not an example of a sociocultural impediment to economic growth?

Correct AnswerverifiedShow Answer

Examples of low-income developing countries are

Correct AnswerverifiedShow Answer

The "brain drain" problem in the DVCs refers to the fact that the best-educated workers

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Assume that the real output of a developing nation increases from $120 billion to $140 billion, while its population expands from 100 to 110 million. As a result, real income per capita has increased by about

Correct AnswerverifiedShow Answer

The "vicious circle of poverty" for developing nations can best be described by

Correct AnswerverifiedShow Answer

An example of direct foreign investment is

Correct AnswerverifiedShow Answer

The vast majority of the labor forces of the low-income DVCs are engaged in agriculture.

Correct AnswerverifiedShow Answer

Which of the following IACs (industrially advanced countries) was the leading provider of development assistance to DVCs (developing countries) in 2015, in terms of absolute dollar amounts?

Correct AnswerverifiedShow Answer

In recent years, the governments of the IACs have

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

The population growth rate of the DVCs (developing countries) as a group in recent decades has been

Correct AnswerverifiedShow Answer

Which of the following DVC policies is not likely to increase DVC economic growth?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Which of the following factors contributes to the weak economic growth in DVCs?

Correct AnswerverifiedShow Answer

Most nations of the world are now IACs, not middle- and low-income DVCs.

Correct AnswerverifiedShow Answer

If the real outputs per capita of a rich nation and a poor nation grow at the same percentage rate, the absolute income gap between the two nations will shrink.

Correct AnswerverifiedShow Answer

Which of the following countries had the best score in the Corruption Perception Index in 2015?

Correct AnswerverifiedShow Answer

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