Question 1

Increases in the total real output of many DVCs do not increase the nation's standard of living because

Accepted Answer

A)  diminishing returns may be encountered in increasing total output.
B)  population increases may dissipate the increase in real output.
C)  disguised unemployment in agriculture will persist.
D)  surplus farm labor may move from rural areas to industrial areas, causing unemployment.E) A) and B)
F) A) and C)

Question 2

The population growth rate in IACs (industrially advanced countries)  in 2000-2010 averaged 0.7 percent per year.This compares to what percentage growth per year in low- income DVCs (developing countries) ?

Accepted Answer

A)  1.1 percent
B)  2.1 percent
C)  4.0 percent
D)  0.4 percentE) B) and C)
F) C) and D)

Question 3

If the real GDP of a DVC increases from $600 billion to $630 billion and its population increases from 200 million to 216 million, its real per capita GDP will

Accepted Answer

A)  increase by about $83.
B)  decrease by about $83.
C)  remained unchanged.
D)  decrease by about $19.E) B) and C)
F) B) and D)

Question 4

An example of direct foreign investment would be the building of a motorcycle factory in China by Honda Motors.

Accepted Answer

A) True 
 B)False

Question 5

It is sometimes difficult to transfer the advanced technologies of the industrialized nations to the DVCs because

Accepted Answer

A)  the technologies of the IACs are frequently based on relatively expensive labor and relatively cheap capital.
B)  the resource endowments of the IACs and the DVCs are highly similar.
C)  international patent laws prohibit such transfers.
D)  the technologies of the IACs are frequently based on relatively cheap labor and relatively expensive capital.E) C) and D)
F) B) and D)

Question 6

The levels of national income per capita among developing countries (DVCs)  are

Accepted Answer

A)  all within a narrow range.
B)  widely varied.
C)  all growing rapidly.
D)  about half of those of industrially advanced countries (IACs) .E) All of the above
F) A) and C)

Question 7

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

Accepted Answer

A)  encouraging direct foreign investment
B)  opening economics to world trade
C)  establishing independent central banks
D)  encouraging emigration of highly skilled workersE) All of the above
F) A) and B)

Question 8

Most economists agree that government efforts in economic development must be

Accepted Answer

A)  employed to substitute for private efforts.
B)  designed to support private efforts.
C)  the sole driver of economic development.
D)  kept at a minimum because we can always rely on markets.E) A) and B)
F) A) and D)

Question 9

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) C) and D)
F) A) and D)

Question 10

Approximately what percentage of the world's income is received by the poorest one-fifth of the world's population?

Accepted Answer

A)  2
B)  5
C)  7
D)  10E) A) and B)
F) C) and D)

Question 11

Which of the following countries had the highest per capita energy consumption in 2013?

Accepted Answer

A)  India
B)  China
C)  Japan
D)  United StatesE) B) and D)
F) B) and C)

Question 12

One suggested policy that industrially advanced nations could adopt to foster economic growth in less-developed nations would be to

Accepted Answer

A)  leave the responsibility to the World Bank.
B)  direct foreign aid to the poorest DVCs.
C)  recruit more skilled workers from DVCs.
D)  target the banking sector for the most help.E) B) and D)
F) A) and C)

Question 13

Japan is a nation that achieved a high standard of living despite having a very limited supply of natural resources.

Accepted Answer

A) True 
 B)False

Question 14

A highly active role by government may be needed to promote economic growth in low-income DVCs because of

Accepted Answer

A)  a lack of infrastructure.
B)  rigid law enforcement in the country.
C)  excessive local entrepreneurship.
D)  all these reasons.E) A) and B)
F) A) and C)

Question 15

For DVC per capita incomes to rise, birth rates must first be reduced.This statement describes the

Accepted Answer

A)  human capital view of population growth.
B)  traditional view of population growth.
C)  capricious universe view.
D)  demographic transition view of population growth.E) A) and C)
F) B) and D)

Question 16

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) A) and C)

Question 17

Government can play a major positive role in the early stage of economic development by

Accepted Answer

A)  providing an adequate infrastructure.
B)  establishing price controls for products.
C)  promoting exports by subsidizing them.
D)  creating marketing boards for export products.E) None of the above
F) A) and C)

Question 18

What measure of economic development is used most often to classify nations as industrially advanced or as developing?

Accepted Answer

A)  per capita income
B)  life expectancy at birth
C)  per capita energy consumption
D)  daily per capita calorie supplyE) B) and C)
F) A) and D)

Question 19

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)  a peasant agriculture view about children.
D)  government authorities.E) A) and C)
F) A) and D)

Question 20

Economic growth in the DVCs might increase if IACs

Accepted Answer

A)  reduce their tariffs and import quotas.
B)  encourage more immigration of highly skilled DVC workers.
C)  outlaw direct private investment abroad by IAC corporations.
D)  discourage capital flight to the DVCs.E) All of the above
F) C) and D)

Exam 22: The Economics of Developing Countries

One suggested policy that industrially advanced nations could adopt to foster economic growth in less-developed nations would be to

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Economic growth in the DVCs might increase if IACs

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Japan is a nation that achieved a high standard of living despite having a very limited supply of natural resources.

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It is sometimes difficult to transfer the advanced technologies of the industrialized nations to the DVCs because

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Government can play a major positive role in the early stage of economic development by

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Most economists agree that government efforts in economic development must be

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For DVC per capita incomes to rise, birth rates must first be reduced.This statement describes the

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

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What measure of economic development is used most often to classify nations as industrially advanced or as developing?

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

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Approximately what percentage of the world's income is received by the poorest one-fifth of the world's population?

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If the real GDP of a DVC increases from $600 billion to $630 billion and its population increases from 200 million to 216 million, its real per capita GDP will

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In the 1990s,

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Increases in the total real output of many DVCs do not increase the nation's standard of living because

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

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An example of direct foreign investment would be the building of a motorcycle factory in China by Honda Motors.

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The levels of national income per capita among developing countries (DVCs) are

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The population growth rate in IACs (industrially advanced countries) in 2000-2010 averaged 0.7 percent per year.This compares to what percentage growth per year in low- income DVCs (developing countries) ?

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A highly active role by government may be needed to promote economic growth in low-income DVCs because of

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Which of the following countries had the highest per capita energy consumption in 2013?

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