Question 1

The demographic transition view of population and growth in DVCs is that

Accepted Answer

A)  the most important factor affecting population growth in DVCs is demographic changes among the elderly.
B)  slower population growth is neither desirable nor productive for DVCs given the state of the economies in these nations.
C)  reduced birth rates must come first in DVCs, and then higher per capita incomes will follow.
D)  higher per capita incomes must come first in DVCs, and then reduced birth rates will follow.E) A) and B)
F) B) and C)

Question 2

Microfinance or microcredit can help directly support

Accepted Answer

A)  labor or workers.
B)  local governments.
C)  entrepreneurs.
D)  consumers.E) A) and B)
F) A) and C)

Question 3

One reason why foreign aid is viewed as harmful is that it promotes dependency.

Accepted Answer

A) True 
 B)False

Question 4

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.E) A) and C)
F) B) and C)

Question 5

In the 1990s,

Accepted Answer

A)  direct private investment to the DVCs increased, and government-provided foreign aid decreased.
B)  both direct private investment and government-provided foreign aid to the DVCs increased.
C)  both direct private investment and government-provided foreign aid to the DVCs decreased.
D)  direct private investment to the DVCs decreased, and government-provided foreign aid increased.E) None of the above
F) B) and C)

Question 6

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

Accepted Answer

A)  are reluctant to become entrepreneurs.
B)  are concentrated in rural areas where their skills are underutilized.
C)  often immigrate to industrialized countries.
D)  are reluctant to work in the public sector.E) All of the above
F) A) and D)

Question 7

Government-provided foreign aid to developing countries

Accepted Answer

A)  has averaged about 1 percent of the IACs' GDP each year.
B)  has increased sharply and steadily since 1995.
C)  has dwarfed the size of foreign direct investment to the DVCs in recent years.
D)  declined in the late 1990s but increased from 2000 to 2008.E) None of the above
F) B) and C)

Question 8

In 2014, the GDP of the United States was approximately

Accepted Answer

A)  $8 trillion less than the GDP of the 135 DVCs in that year.
B)  $8 trillion more than the GDP of the 135 DVCs in that year.
C)  twice the GDP of the 135 DVCs in that year.
D)  the same as the GDP of 135 DVCs in that year.E) A) and B)
F) None of the above

Question 9

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 savingE) A) and B)
F) B) and C)

Question 10

A recommended policy for developing countries to stimulate economic growth would be

Accepted Answer

A)  abolishing central banks.
B)  more central planning by government.
C)  encouraging more direct foreign investment.
D)  expanding employment in state industries.E) B) and D)
F) All of the above

Question 11

Which of the following is most characteristic of most developing nations?

Accepted Answer

A)  roughly equal distribution of income among the population
B)  high levels of labor productivity in agriculture
C)  low propensity to consume goods and services
D)  low levels of saving and investmentE) None of the above
F) A) and C)

Question 12

In recent years, many DVCs have come to realize that

Accepted Answer

A)  expanded international trade is harmful to DVCs.
B)  private capital investment is essential for economic growth in DVCs.
C)  the International Monetary Fund is the major institutional barrier to economic growth.
D)  government involvement in economic development is the only avenue for economic growth.E) None of the above
F) A) and B)

Question 13

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.E) All of the above
F) None of the above

Question 14

Which of the following countries had the highest per capita income (on a purchasing power parity basis)  in 2014?

Accepted Answer

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

Question 15

Most of the flow of foreign aid goes to

Accepted Answer

A)  the poorest of developing countries (DVCs) .
B)  the most affluent of the developing country populations.
C)  the smallest developing countries.
D)  about 70 percent of the world's poorest people.E) A) and D)
F) C) and D)

Question 16

Saving is a larger percentage of domestic output in DVCs than in IACs, but the saving is put to poor use.

Accepted Answer

A) True 
 B)False

Question 17

Which of the following is typically not a problem for low-income DVCs?

Accepted Answer

A)  capital flight
B)  "brain drain"
C)  high saving rates that slow aggregate demand growth
D)  poor infrastructureE) C) and D)
F) None of the above

Question 18

Which of the following is most characteristic of developing nations?

Accepted Answer

A)  a small percentage of the labor force in agriculture
B)  a relatively equitable distribution of income
C)  low levels of labor productivity
D)  low rates of population growthE) A) and D)
F) A) and C)

Question 19

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

Question 20

The ability of the DVCs to use the technologies of the IACs is somewhat limited because

Accepted Answer

A)  the IACs have patents on most of their technologies.
B)  the IACs and the DVCs have much different resource endowments.
C)  the technologies of the IACs rely heavily on unskilled labor.
D)  IAC technologies are labor-intensive, while DVC technologies are capital-intensive.E) A) and B)
F) None of the above

Exam 42: The Economics of Developing Countries

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

Correct Answer
verified

The demographic transition view of population and growth in DVCs is that

Correct Answer
verified

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

Correct Answer
verified

Saving is a larger percentage of domestic output in DVCs than in IACs, but the saving is put to poor use.

Correct Answer
verified

The ability of the DVCs to use the technologies of the IACs is somewhat limited because

Correct Answer
verified

Microfinance or microcredit can help directly support

Correct Answer
verified

One reason why foreign aid is viewed as harmful is that it promotes dependency.

Correct Answer
verified

Which of the following countries had the highest per capita income (on a purchasing power parity basis) in 2014?

Correct Answer
verified

Which of the following is most characteristic of most developing nations?

Correct Answer
verified

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

Correct Answer
verified

Government-provided foreign aid to developing countries

Correct Answer
verified

In the 1990s,

Correct Answer
verified

In 2014, the GDP of the United States was approximately

Correct Answer
verified

Most of the flow of foreign aid goes to

Correct Answer
verified

In recent years, many DVCs have come to realize that

Correct Answer
verified

Correct Answer
verified

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

Correct Answer
verified

Which of the following is typically not a problem for low-income DVCs?

Correct Answer
verified

A recommended policy for developing countries to stimulate economic growth would be

Correct Answer
verified

Which of the following is most characteristic of developing nations?

Correct Answer
verified

Exam 42: The Economics of Developing Countries

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

Correct AnswerverifiedShow Answer

The demographic transition view of population and growth in DVCs is that

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Saving is a larger percentage of domestic output in DVCs than in IACs, but the saving is put to poor use.

Correct AnswerverifiedShow Answer

The ability of the DVCs to use the technologies of the IACs is somewhat limited because

Correct AnswerverifiedShow Answer

Microfinance or microcredit can help directly support

Correct AnswerverifiedShow Answer

One reason why foreign aid is viewed as harmful is that it promotes dependency.

Correct AnswerverifiedShow Answer

Which of the following countries had the highest per capita income (on a purchasing power parity basis) in 2014?

Correct AnswerverifiedShow Answer

Which of the following is most characteristic of most developing nations?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Government-provided foreign aid to developing countries

Correct AnswerverifiedShow Answer

In the 1990s,

Correct AnswerverifiedShow Answer

In 2014, the GDP of the United States was approximately

Correct AnswerverifiedShow Answer

Most of the flow of foreign aid goes to

Correct AnswerverifiedShow Answer

In recent years, many DVCs have come to realize that

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Which of the following is typically not a problem for low-income DVCs?

Correct AnswerverifiedShow Answer

A recommended policy for developing countries to stimulate economic growth would be

Correct AnswerverifiedShow Answer

Which of the following is most characteristic of developing nations?

Correct AnswerverifiedShow Answer

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