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Question Bank - Economics

Development Economics

Q1. The policy that has been the most successful in increasing agricultural output in developing countries is

(Select one answer)

(a) * import substitution.
(b) * produce-marketing boards.
(c) * land reform.
(d) * mechanisation

Source: Pearson logo

Q2. Low agricultural productivity in developing countries is mainly caused by

(Select one answer)

(a) * shortages of inputs, including land.
(b) * migration from rural areas to urban areas.
(c) * a lack of effective demand for food products.
(d) * an over-investment in farm equipment.

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Q3. The poorest 20% of the world's population receives about _____ of the world's income.

(Select one answer)

(a) * .5%
(b) * 2%
(c) * 5%
(d) * 12%

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Q4. According to Malthus and some of the early economic thinkers, the economy's total population will

(Select one answer)

(a) * fall if the standard of living is above the subsistence level
(b) * fall if the standard of living is below the subsistence level
(c) * remain constant if the standard of living is above the subsistence level
(d) * rise if the standard of living is below the subsistence level

Source: McGraw Hill logo

Q5. All of the following hinder economic growth in the LDCs, except

(Select one answer)

(a) * a strategy of import substitution
(b) * high rates of population growth
(c) * the need to borrow huge amounts of financial capital from abroad
(d) * inefficiencies in the use of its scarce productive resources

Source: McGraw Hill logo

Q6. The fastest way to equalize the world distribution of income is to

(Select one answer)

(a) * provide massive direct transfers to LDCs
(b) * forgive existing LDC debts
(c) * permit free migration
(d) * open all northern markets to completely free trade

Source: McGraw Hill logo

Q7. Which of the following factors has been suggested as an explanation for the lack of economic growth in many poor nations?

(Select one answer)

(a) * a steady rate of capital formation
(b) * the supply of human resources is too high
(c) * an adequate level of social overhead capital
(d) * the constraints imposed by dependency on the already-developed nations

Source: Pearson logo

Q8. One of the benefits of putting resources into agricultural projects is that

(Select one answer)

(a) * that agricultural investment will prevent the flight of capital abroad
(b) * that export prices for agricultural products are more stable than those for industrial products.
(c) * successful agricultural projects produce surplus food to support urban development
(d) * that agricultural projects usually have very low import requirements.

Source: Pearson logo

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