Economics Today and Tomorrow

Chapter 20: Economic Growth in Developing Countries

Economic Growth in Developing Countries

Of the more than 185 nations in the world, how many are considered to be developed?
A)less than 20
B)about 35
C)about 50
D)about 80
Each of the following is a characteristic of developing nations EXCEPT __________
A)low per capita GDP.
B)economies based on agriculture.
C)poor health conditions and low literacy rates.
D)slow population growth due to a low standard of living.
One reason for the low per capita GDP of developing nations is __________
A)the lack of natural resources.
B)the lack of human resources.
C)the lack of equipment, financing, and knowledge.
D)the lack of sufficient farmland.
With subsistence agriculture, families grow __________
A)enough crops for export.
B)just enough food to take care of their needs.
C)enough food to take care of their needs with some left over to sell in the marketplace.
D)only one crop, such as potatoes.
Developing nations' poorly defined property rights result in all of the following EXCEPT __________
A)individuals cannot exchange land.
B)the government redistributes profits from the sale of land.
C)individuals do not have the incentive to improve the value of the property on which they farm.
D)large-scale farming is undermined.
Developing nations' two major sources of capital for economic development are __________
A)investment by foreign businesses and domestic savings.
B)domestic savings and foreign aid from developed nations.
C)investment by foreign businesses and domestic aid.
D)investment by foreign businesses and foreign aid from developed nations.
All of the following attract investors to invest in developing nations EXCEPT __________
A)political instability.
B)low wages.
C)a large labor force.
D)abundant raw materials.
Which of the following types of foreign aid is NOT directed toward economic development?
A)providing professionals such as engineers, teachers, and technicians
B)providing economic or technical assistance to a nation's armed forces
C)emergency shipments of supplies to victims of natural disasters
D)building roads, bridges, and airports
In 1945 the International Bank for Reconstruction and Development, also known as the World Bank, became a channel of foreign aid for __________
A)the United Nations.
B)the United States.
C)the European Union.
D)the Organization of American States.
A developed nation's reasons for giving foreign aid might include a desire to do all of the following EXCEPT __________
A)encourage international trade.
B)help end world hunger and disease.
C)build military alliances.
D)protect domestic industries.
All of the following factors are obstacles to economic growth in developing nations EXCEPT __________
A)traditional attitudes and beliefs.
B)lack of trade restrictions.
C)high defense spending.
D)rapid population growth.
The major blame for the failure of Indonesia's economy under President Sukarno can be placed on __________
A)the Indonesian peoples' lack of a national identity.
B)violent ethnic and political clashes among Indonesians.
C)Sukarno's economic policies.
D)General Suharto's economic policies.
After examining the case study of Indonesia, what can we understand about foreign aid?
A)Foreign aid alone does not guarantee economic growth.
B)Foreign aid guarantees economic growth and development in developing nations.
C)Foreign aid is especially effective when a nation's economy specializes in only one or two products.
D)Foreign aid is especially effective when government restrictions on economic activity are increased.
The problems of rapid industrialization include all of the following EXCEPT __________
A)use of inappropriate technology.
B)too much consumer demand.
C)insufficient time to move through the stages of development.
D)insufficient time to adapt to changed patterns of living.
The major factors that influence nations' economic development include all of the following EXCEPT __________
A)the size of government bureaucracy.
B)trade with the outside world.
C)an appropriate incentive structure.
D)a supportive political structure.
How has increased communication, through the media and the Internet, affected international economic cooperation?
A)Developing nations have come to realize that they do not have power in the international economic community.
B)Developing nations have been exposed to the higher living standards of developed nations, and this has led to resentment toward those nations.
C)Cooperation between developed nations and developing nations has increased, and developing nations have been convinced of the benefits of working together.
D)Increased communication has had little effect on the developing nations.
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