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Exam 28: The Economics of Developing Countries

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Question 31

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Capital flight from the DVCs may be caused by

A) a fear of government privatization efforts.
B) slow domestic inflation.
C) low rates of domestic taxation.
D) risks of severe fluctuations in exchange rates.

E) C) and D)
F) B) and D)

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Question 32

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The lack of an entrepreneurial class in developing nations tends to

A) keep workers from migrating to cities from rural areas.
B) reduce the level of capital investment.
C) force the need for land reform.
D) keep governments stable.

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

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Question 33

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Assume that the real output of a developing nation increases from $50 billion to $62 billion, while its population expands from 100 to 115 million. As a result, real income per capita has increased by about

The capricious universe view is the idea that the IACs are exploiting the DVCs.

Which of the given nations would be low-income developing countries (DVCs) , according to the World Bank?

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.

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

What are the two divisions of the World Bank? What do they do?

State industries are notoriously poor "incubators" for the development of profit-focused, entrepreneurial persons who may leave the firm to set up their own businesses. This statement is an argument in favor of

Assume a DVC has a real per capita output of $1,000 as compared to $20,000 for an IAC. If both nations realize a 2 percent growth of their real per capita outputs, after one year the absolute real per capita output gap will

Industrially advanced countries can help developing countries by

In 2017, the IACs (industrially advanced countries)had an average per capita income that was about 50 times as high as that of the low-income nations.

An institutional change that is needed in most developing nations is

When technological advances are of the capital-using kind, it is possible for an economy to increase its productivity without any net investment in capital goods.

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

Large agricultural subsidies for food and fiber in IACs hurt the economies of the DVCs by

Which of the following is considered to be a severe obstacle to economic growth for DVCs?

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

If the real output of a DVC increases from $200 billion to $260 billion and its population increases from 100 to 120 million, its real per capita output will have

Define corruption. Is this common in DVCs?