Development economists

  do not discuss values, since Economics thinks of itself as very similar to a

physical science. do not discuss values, because Economics is a value-free science.

consider values in their analysis, because they believe in certain universal value

premises on which everyone agrees. do not discuss values, in order to avoid injecting

their own cultural biases into the analysis. consider values in their analysis, because economic investigations cannot be considered separately from their institutional, social, and political contexts.

  do not discuss values, since Economics thinks of itself as very similar to a physical science.

  do not discuss values, in order to avoid injecting their own cultural biases into the analysis.

  consider values in their analysis, because economic investigations cannot be considered separately from their institutional, social, and political contexts.

  do not discuss values, because Economics is a value-free science.

  consider values in their analysis, because they believe in certain universal value premises on which everyone agrees.

Development is now thought to mean

  sustained increases in GNP per capita only. a movement towards national

food security. the process by which authoritarian political structures give way to

more democratic forms of government. economic growth, accompanied by dramatic

change in social and political institutions, as well as in the attitudes of the people. increases in the population growth rates to more reasonable levels.

  sustained increases in GNP per capita only.

  economic growth, accompanied by dramatic change in social and political institutions, as well as in the attitudes of the people.

  increases in the population growth rates to more reasonable levels.

  the process by which authoritarian political structures give way to more democratic forms of government.

  a movement towards national food security.

The three core values of development are

  sustenance, self-esteem, and freedom. freedom, security, and democracy.

sustenance, freedom, and security. freedom, free markets, and free trade. sustenance, democracy, and free markets.

  sustenance, democracy, and free markets.

  sustenance, self-esteem, and freedom.

  sustenance, freedom, and security.

  freedom, free markets, and free trade.

  freedom, security, and democracy.

Traditional measures of economic development include

  a. GNP or GDP growth rates. b. Total Value of Currency (TVC) per

capita. c. income per capita growth rates. all of the above a and c only

  a. GNP or GDP growth rates.

  b. Total Value of Currency (TVC) per capita.

  c. income per capita growth rates.

  all of the above

  a and c only

Developing countries are commonly characterized by

  a. low levels of living, high levels of income inequality, and high dependency

burdens. b. low levels of productivity, prevalence of imperfect markets, and high

rates of population growth. c. primary-product exports, inadequate education and

vulnerability in international relations. d. all of the above e. a and b only

  a. low levels of living, high levels of income inequality, and high dependency burdens.

  b. low levels of productivity, prevalence of imperfect markets, and high rates of population growth.

  c. primary-product exports, inadequate education and vulnerability in international relations.

  d. all of the above

  e. a and b only

Which of the following is not one of Kuznet's six characteristics of modern economic growth?

  High rates of growth of per capita output and population High rates of

infrastructure amelioration High rates of social and ideological transformation

High rates of structural transformation of the economy High rates of increase in total factor productivity

  High rates of growth of per capita output and population

  High rates of social and ideological transformation

  High rates of structural transformation of the economy

  High rates of infrastructure amelioration

  High rates of increase in total factor productivity

The migration of highly educated and skilled workers from developing countries to developed countries is

  generally encouraged by developing countries as a way to reduce population

pressure. illegal. commonly known as the "brain drain." less of a problem

now than it was in the 1970s. none of the above.

  generally encouraged by developing countries as a way to reduce population pressure.

  commonly known as the "brain drain."

  less of a problem now than it was in the 1970s.

  illegal.

  none of the above.

For more rapid rates of economic growth, increased saving and investment is

  is a sufficient but not necessary condition. a necessary but not sufficient

condition. a necessary and sufficient condition. is neither a necessary nor a sufficient condition.

  is a sufficient but not necessary condition.

  a necessary and sufficient condition.

  is neither a necessary nor a sufficient condition.

  a necessary but not sufficient condition.

In the Harrod-Domar model, suppose that the national capital-output ratio is 4. If the national net savings rate increases from 8% to 12%, the economic growth rate will increase from __________ to __________.

  32%; 48% 0.5%; 0.33% The answer cannot be determined from the

information provided. 2%; 3% -6%; 0%

  0.5%; 0.33%

  -6%; 0%

  2%; 3%

  The answer cannot be determined from the information provided.

  32%; 48%

According to the pattern of the demographic transition, a country's population growth rate generally

  starts out high, then decreases. starts out low, then increases, and finally

falls once again. starts out low, then increases. starts out high, then decreases

before finally increasing once again. none of the above

  starts out high, then decreases before finally increasing once again.

  starts out high, then decreases.

  starts out low, then increases.

  starts out low, then increases, and finally falls once again.

  none of the above

According to the microeconomic household theory of fertility, children in poor societies are seen, at least in part, as economic investment goods because

  a. children act as parents' social security or old-age pension. b. unlike

ordinary investment goods, children do not depreciate. c. children provide labor

income to the family. a and b only a and c only

  a. children act as parents' social security or old-age pension.

  b. unlike ordinary investment goods, children do not depreciate.

  c. children provide labor income to the family.

  a and b only

  a and c only

The annual world population growth rate

  a. is rising ever more rapidly as time goes by. b. is expected to approach

10% by the end of the 21st century. c. seems to have peaked and is now falling.

d. has reached a level that clearly is unsustainable. b and d are both correct.

  a. is rising ever more rapidly as time goes by.

  b. is expected to approach 10% by the end of the 21st century.

  c. seems to have peaked and is now falling.

  d. has reached a level that clearly is unsustainable.

  b and d are both correct.

Prior to the industrial revolution of the 19th century, annual world population growth rates averaged

  about 1.0%. about 1.5%. about 2.0%. above 2.0%. less than 0.5%.

  about 2.0%.

  above 2.0%.

  about 1.0%.

  about 1.5%.

  less than 0.5%.

Market prices of outputs and inputs may not give a true reflection of social benefits and costs because

  a. modern sector wage rates often exceed the social opportunity cost of labor.

b. price controls exist for many goods and services. c. import prices often

overstate the real cost to a country of purchasing imports. all of the above. a and b only.

  a. modern sector wage rates often exceed the social opportunity cost of labor.

  b. price controls exist for many goods and services.

  c. import prices often overstate the real cost to a country of purchasing imports.

  all of the above.

  a and b only.

A well-functioning market system requires which of the following preconditions?

  a. centralization of political power. b. enforcement of contracts and

conditions of law and order. c. a considerable degree of market power in the form of

oligopolies and monopolies. all of the above. a and b only.

  a. centralization of political power.

  b. enforcement of contracts and conditions of law and order.

  c. a considerable degree of market power in the form of oligopolies and monopolies.

  all of the above.

  a and b only.

The approach to planning that involves an examination of the interrelationships between sectors of the economy is called

  shadow price computation theory. project appraisal. input-output

modeling. social cost-benefit analysis. aggregate growth modeling.

  shadow price computation theory.

  input-output modeling.

  project appraisal.

  social cost-benefit analysis.

  aggregate growth modeling.

The incidence of third-world poverty falls especially heavily on

  a. workers in the urban informal sector. b. women and their dependents.

c. ethnic minorities and indigenous populations. all of the above b and c only

  a. workers in the urban informal sector.

  b. women and their dependents.

  c. ethnic minorities and indigenous populations.

  all of the above

  b and c only

According to the Kuznets hypothesis,

  income inequality falls as per capita income rises. income inequality rises

as per capita income rises. income inequality first falls then rises as per capita income

rises. income inequality first rises then falls as per capita income rises. none of the above - there is no pattern

  income inequality first rises then falls as per capita income rises.

  income inequality first falls then rises as per capita income rises.

  income inequality falls as per capita income rises.

  income inequality rises as per capita income rises.

  none of the above - there is no pattern

In the last 10 years, the absolute number of persons living on less than $1 per day has declined in which of the following region(s)?

  East Asia and Pacific Nowhere Sub-Saharan Africa, East Asia and

Pacific Sub-Saharan Africa South Asia

  East Asia and Pacific

  Sub-Saharan Africa

  South Asia

  Nowhere

  Sub-Saharan Africa, East Asia and Pacific

The Human Poverty Index measures poverty in terms of which three 'deprivations'?

  economic provisioning, life, and political freedom economic provisioning,

civil liberties, and political freedom basic education, economic provisioning, and

civil liberties income inequality, life, and basic education economic provisioning, basic education, and life

  economic provisioning, basic education, and life

  income inequality, life, and basic education

  economic provisioning, life, and political freedom

  economic provisioning, civil liberties, and political freedom

  basic education, economic provisioning, and civil liberties

The developing world experienced a substantial deterioration in both current and capital account balances

  in the 1970s. between 1950 and 1980. between 1960 and 1970. in

the 1980s. in the 1960s.

  in the 1980s.

  in the 1960s.

  between 1960 and 1970.

  between 1950 and 1980.

  in the 1970s.

Which of the following is NOT part of a typical IMF macroeconomic stabilization program?

  Liberalization of foreign exchange and import controls. Stringent anti-

inflation policies, both on the monetary policy side and the fiscal policy side.

Introduction of wage and price controls to combat inflation. Greater hospitality to

foreign investment. Devaluation of the exchange rate.

  Greater hospitality to foreign investment.

  Devaluation of the exchange rate.

  Liberalization of foreign exchange and import controls.

  Introduction of wage and price controls to combat inflation.

  Stringent anti-inflation policies, both on the monetary policy side and the fiscal policy side.

When a developing country incurs international debts,

  it is always a mistake. the situation will impede development. the situation may impede development if the borrowed funds are invested in development

projects with relatively high rates of return. the situation may impede development if the borrowed funds are invested in development projects with relatively low rates of

return. the situation is likely to help the development process if the interest rate on the loans is relatively high.

  the situation may impede development if the borrowed funds are invested in development projects with relatively high rates of return.

  it is always a mistake.

  the situation will impede development.

  the situation is likely to help the development process if the interest rate on the loans is relatively high.

  the situation may impede development if the borrowed funds are invested in development projects with relatively low rates of return.

When a multinational corporation artificially inflates the price it pays for intermediate products purchased from overseas affiliates in an effort to lower stated local profits and pay lower taxes, the MNC is said to be practicing 

least-squares pricing.

transfer pricing.

portfolio pricing.

average cost pricing.

foreign exchange gap pricing.   portfolio pricing.

  least-squares pricing.

  average cost pricing.

  transfer pricing.

  foreign exchange gap pricing.

In most major developed countries, official development assistance is what percent of developed-country GNP?

  5% 10% less than 1% 2.5% 1%

  less than 1%

  5%

  2.5%

  10%

  1%

Which of the following is not a reason why donor countries give official development assistance to developing countries?

  to assist developing countries in the development process. to advance the

donor country's political interests. to provide short term humanitarian relief in times

of famine. to create markets for donor-country exports. all of the above are reasons donor countries provide official development assistance.

  to provide short term humanitarian relief in times of famine.

  to advance the donor country's political interests.

  to create markets for donor-country exports.

  to assist developing countries in the development process.

  all of the above are reasons donor countries provide official development assistance.

Which of the following is not an objective of macroeconomic stabilization plans?

  Controlling inflation Reducing or eliminating unemployment Moving towards a balanced government budget by cutting spending and increasing tax revenues

Eliminating the current account deficit All of the above are objectives of macroeconomic stabilization plans

  Moving towards a balanced government budget by cutting spending and increasing tax revenues

  Eliminating the current account deficit

  Reducing or eliminating unemployment

  Controlling inflation

  All of the above are objectives of macroeconomic stabilization plans

As a proportion of GDP, personal income tax revenues

  are slightly lower in LDCs than in developed countries. are about the

same in LDCs and more developed countries. are slightly higher in LDCs than in

developed countries. are much lower in LDCs than in developed countries. are much higher in LDCs than in developed countries.

  are much lower in LDCs than in developed countries.

  are slightly higher in LDCs than in developed countries.

  are much higher in LDCs than in developed countries.

  are slightly lower in LDCs than in developed countries.

  are about the same in LDCs and more developed countries.

Most studies have demonstrated that

  once interest payments, subsidies, and tax arrears are accounted for, most

state-owned enterprises have small (but positive) operating surpluses. once interest

payments, subsidies, and tax arrears are accounted for, most state-owned enterprises have

large operating deficits. despite perceptions to the contrary, state-owned enterprises

in developing countries usually have relatively large operating surpluses. state-owned

enterprises are generally profitable in African countries, but not in other regions. in accord with perceptions, state-owned enterprises in developing countries usually have relatively large operating surpluses.

  once interest payments, subsidies, and tax arrears are accounted for, most state-owned enterprises have large operating deficits.

  in accord with perceptions, state-owned enterprises in developing countries usually have relatively large operating surpluses.

  state-owned enterprises are generally profitable in African countries, but not in other regions.

  despite perceptions to the contrary, state-owned enterprises in developing countries usually have relatively large operating surpluses.

  once interest payments, subsidies, and tax arrears are accounted for, most state-owned enterprises have small (but positive) operating surpluses.

The share of developing country military expenditures in total world military spending

  has steadily increased since 1960. increased steadily until 1980 but has

fallen steadily ever since. has generally increased, but did fall in the 1980s. has

remained steady at under 5%. has steadily decreased since 1960.

  has generally increased, but did fall in the 1980s.

  has steadily decreased since 1960.

  increased steadily until 1980 but has fallen steadily ever since.

  has remained steady at under 5%.

  has steadily increased since 1960.

At the dawn of the 21st century,

  developing countries are becoming less dependent on developed countries.

both developing and developed countries are less economically interdependent than

ever before. developed countries are becoming decreasingly economically dependent

on developing countries. developing countries continue to be heavily dependent on

developed countries. none of the above.

  developing countries continue to be heavily dependent on developed countries.

  both developing and developed countries are less economically interdependent than ever before.

  developing countries are becoming less dependent on developed countries.

  developed countries are becoming decreasingly economically dependent on developing countries.

  none of the above.