Master Development Economics: Online Quizzes and Study Guide

Question 1

Which measure is used to assess economic inequality within a country?

Accepted Answer

Gini coefficient

Answer

GDP per capita

Answer

Human Development Index

Question 2

How do institutional arrangements, such as property rights, legal systems, and political structures, impact economic outcomes in developing countries?

Accepted Answer

Institutions influence economic outcomes by providing a framework for economic activity, reducing uncertainty, and facilitating cooperation.

Answer

Institutions have no significant impact on economic outcomes in developing countries.

Answer

Property rights and legal systems are the only institutional arrangements that influence economic outcomes.

Answer

Strong institutions always lead to positive economic outcomes, regardless of the context.

Question 3

Which challenge is unique to Small Island Developing States (SIDS) compared to Landlocked Developing Countries (LLDCs)?

Accepted Answer

Extreme vulnerability to natural disasters

Answer

Limited access to global markets

Answer

Reliance on tourism as a major economic activity

Answer

High transportation expenses

Question 4

According to dependency theory, what is the primary barrier to economic progress in developing nations?

Accepted Answer

Exploitation by developed nations through global trade

Answer

Insufficient investment in education and infrastructure

Answer

High birth rates and limited access to family planning

Answer

Political instability and corruption

Question 5

Examine the multifaceted effects of urbanization in developing nations, considering its influence on economic growth, infrastructure development, and social progress.

Accepted Answer

Urbanization can simultaneously foster economic growth and pose infrastructure challenges in developing countries.

Answer

Urbanization primarily benefits the urban elite in developing countries.

Answer

Urbanization in developing countries significantly impacts environmental sustainability.

Question 6

What sets less developed countries (LDCs) apart from developing countries?

Accepted Answer

Significantly lower income per person

Answer

Unusually high economic growth rates

Answer

Advanced industrialization and technology

Question 7

How does education contribute to economic development in developing countries? Analyze both its direct and indirect impacts on economic growth and development.

Accepted Answer

Education primarily enhances human capital, leading to increased productivity, innovation, and economic growth.

Answer

Education solely reduces income inequality by providing opportunities for upward social mobility.

Answer

Education only indirectly impacts economic development through improved health and nutrition.

Answer

Education has no significant role in promoting economic development in developing countries.

Question 8

Analyze the economic impacts of remittances on developing countries, considering both their potential benefits and drawbacks.

Accepted Answer

Remittances have both positive and negative effects on economic development, and their overall impact varies depending on the specific context and policies implemented.

Answer

Remittances exclusively promote economic growth without any potential negative effects.

Answer

Remittances primarily lead to negative consequences, such as inflation and exchange rate fluctuations.

Question 9

Evaluate the relationship between infrastructure development and economic growth in developing countries, considering the diverse impacts of different infrastructure types.

Accepted Answer

Infrastructure development fosters economic growth by reducing transaction costs, boosting productivity, and attracting foreign investments.

Answer

Infrastructure development only benefits economic growth in the long term.

Answer

All infrastructure types have a uniform impact on economic growth.

Answer

Infrastructure development has no direct impact on economic growth, but it improves social welfare.

Question 10

In developing countries, how does the informal sector contribute to economic development? Discuss its potential benefits and drawbacks in the fight against poverty.

Accepted Answer

The informal sector provides jobs and encourages entrepreneurship, but its low wages and lack of social protection can perpetuate poverty.

Answer

The informal sector significantly contributes to economic growth but has a limited impact on poverty reduction.

Answer

The informal sector operates outside of regulations and taxes, hindering economic development.

Answer

The informal sector is a temporary phenomenon that will disappear as economies develop.

Question 11

How does education contribute to empowering citizens and reducing regional disparities in developing countries?

Accepted Answer

Education empowers citizens by providing knowledge and skills for economic and social participation.

Answer

Education primarily benefits urban areas, worsening regional disparities.

Answer

Education has minimal impact on regional disparities, with economic growth driven by natural resources and foreign investment.

Answer

Education benefits only the elite, increasing inequality and social unrest.

Question 12

According to the neoclassical growth model, which factor is the primary determinant of long-term economic growth?

Accepted Answer

Technological progress

Answer

Capital accumulation

Answer

Human capital

Answer

Natural resources

Question 13

Which criticism is most frequently raised against the 'dependency theory' regarding development?

Accepted Answer

Overemphasizing international influences

Answer

Underestimating internal policy impact

Answer

Advocating isolation from world markets

Answer

Assuming developing nations are inherently inferior

Question 14

Sustainable development strategies commonly prioritize:

Accepted Answer

Balancing economic, social, and environmental factors

Answer

Economic growth at any cost

Answer

Rapid industrialization

Answer

Uncontrolled urbanization

Question 15

The 'bottom-up' development approach emphasizes:

Accepted Answer

Empowering local communities

Answer

Centralized decision-making

Answer

Attracting foreign direct investment

Answer

Large-scale infrastructure projects

Question 16

According to the Harrod-Domar model, which factor is crucial for achieving economic growth?

Accepted Answer

Capital accumulation

Answer

Natural resources

Answer

Foreign aid

Answer

Technological progress

Question 17

The central aim of sustainable development is to:

Accepted Answer

Fulfill present needs without compromising the ability of future generations to meet their own

Answer

Maximize economic growth regardless of environmental or social consequences

Answer

Eradicate poverty and improve living standards

Answer

Promote political stability and democracy

Question 18

Economic development differs from economic growth in that it emphasizes:

Accepted Answer

Qualitative improvement in living standards

Answer

Quantitative increase in output

Answer

There is no distinction between the two concepts

Answer

Economic development focuses solely on industrial growth

Question 19

Which of the following is a key economic challenge faced by developing countries, characterized by a lack of basic necessities and a significant portion of the population living in poverty?

Accepted Answer

Poverty

Answer

Inflation

Answer

Income inequality

Answer

Environmental degradation

Question 20

According to the Dependency Theory, the economic underdevelopment of developing countries is primarily attributed to:

Accepted Answer

Colonialism and imperialism

Answer

Lack of natural resources

Answer

Cultural backwardness

Answer

Overpopulation

Question 21

Which of the following is a primary goal of sustainable development, aiming to balance current needs with those of future generations?

Accepted Answer

Meeting the needs of the present without compromising the future

Answer

Promoting economic growth at any cost

Answer

Reducing poverty and inequality

Answer

Protecting the environment

Question 22

What is the primary objective of the Human Development Index (HDI), a composite statistic used to rank countries?

Accepted Answer

To measure the overall well-being of a country

Answer

To assess economic growth

Answer

To rank countries based on their military strength

Answer

To predict future economic performance

Question 23

What is the term used to describe the economic relationship where developing countries primarily export raw materials to industrialized countries in exchange for manufactured goods?

Accepted Answer

Dependency

Answer

Neocolonialism

Answer

Comparative advantage

Answer

Import substitution

Question 24

According to Rostow's modernization theory, which stage comes after the stage of preconditions for take-off?

Accepted Answer

Take-off

Answer

Drive to maturity

Answer

Age of high mass consumption

Answer

Age of diminishing returns

Question 25

What is a key strategy for achieving sustainable development in developing countries?

Accepted Answer

Investing in education, healthcare, and infrastructure to improve living standards.

Answer

Focusing solely on economic growth, regardless of environmental or social consequences.

Answer

Providing foreign aid without proper oversight or accountability.

Question 26

The Lewis model of economic development suggests that surplus labor from the agricultural sector is primarily absorbed by which sector?

Accepted Answer

Manufacturing

Answer

Services

Answer

Agriculture

Answer

Mining

Question 27

Which of the following is a widely used indicator of economic growth in development economics?

Accepted Answer

Gross domestic product (GDP)

Answer

Human Development Index (HDI)

Answer

Purchasing power parity (PPP)

Answer

Gini coefficient

Question 28

The primary goal of sustainable development is to achieve:

Accepted Answer

Economic growth without compromising environmental sustainability

Answer

Reduced poverty and inequality

Answer

Increased access to education and healthcare

Answer

Enhanced political stability and governance

Question 29

The main focus of development economics is to analyze:

Accepted Answer

The economic challenges and opportunities faced by developing countries

Answer

Promoting economic growth in developed countries

Answer

Studying the effects of globalization on advanced economies

Answer

Evaluating the effectiveness of poverty reduction programs in industrialized nations

Question 30

Which of the following is NOT a contributing factor to income inequality in developing countries?

Accepted Answer

Rapid technological advancements and automation

Answer

Unequal access to quality education and skills training

Answer

Discrimination based on gender, race, or ethnicity

Answer

Political corruption and cronyism

Question 31

What is the relationship between economic growth and poverty reduction?

Accepted Answer

Rapid economic growth can contribute to poverty reduction, but it is not always sufficient or inclusive

Answer

Poverty reduction is a prerequisite for sustained economic growth

Answer

Economic growth and poverty reduction are independent of each other

Answer

Economic growth inevitably leads to poverty reduction for all segments of society

Question 32

Which of the following is NOT a key challenge faced by developing countries?

Accepted Answer

Political stability

Answer

Poverty

Answer

Environmental degradation

Answer

Economic inequality

Question 33

According to the Harrod-Domar growth model, the primary driver of economic growth is:

Accepted Answer

Capital accumulation

Answer

Labor force growth

Answer

Technological progress

Answer

Foreign aid

Question 34

The concept of 'capacity building' in development economics primarily refers to:

Accepted Answer

Developing and strengthening local skills, knowledge, and institutions.

Answer

Providing financial aid to recipient countries for development projects.

Answer

Imposing economic sanctions on corrupt or non-compliant governments.

Answer

Negotiating trade agreements with developing countries.

Question 35

Which development theory advocates for proactive government intervention and import substitution to stimulate domestic industries?

Accepted Answer

Structuralist theory

Answer

Neoliberal theory

Answer

Dependence theory

Answer

Post-development theory

Question 36

Which indicator is commonly employed to measure the extent of poverty in a population?

Accepted Answer

Headcount Index (measures the percentage of individuals living below the poverty line)

Answer

Gini coefficient (measures income inequality)

Answer

Human Development Index (measures overall well-being)

Answer

Purchasing Power Parity (measures the cost of living in different countries)

Question 37

Which of the following is a central tenet of dependency theory?

Accepted Answer

Developing countries' economic growth is hindered by their dependency on developed nations

Answer

Foreign aid and investment lead to increased economic prosperity in developing countries

Answer

Free trade benefits both developed and developing nations equally

Answer

Government intervention in the economy can accelerate economic development

Question 38

Identify the key challenge that is **not** typically faced by developing countries.

Accepted Answer

Political stability and governance

Answer

High levels of poverty

Answer

Significant income inequality

Answer

Environmental degradation

Question 39

According to 'dependency theory', what is the primary cause of underdevelopment in developing countries?

Accepted Answer

External factors like colonialism and exploitation

Answer

Internal factors like cultural barriers

Answer

A combination of internal and external factors

Answer

None of the aforementioned factors

Question 40

Empirical evidence consistently suggests that foreign aid has what effect on economic growth in developing countries?

Accepted Answer

An inconsistent or mixed effect

Answer

A consistently positive effect

Answer

A consistently negative effect

Answer

No significant effect

Question 41

Which characteristic is distinctive to 'inclusive growth'?

Accepted Answer

Benefits are broadly shared across society

Answer

Prioritizes environmental sustainability

Answer

Emphasizes rapid economic expansion

Answer

Focuses primarily on reducing inflation

Question 42

The term 'human capital' refers to:

Accepted Answer

The accumulated knowledge, skills, and abilities of individuals

Answer

The tangible physical assets owned by individuals

Answer

The natural resources accessible to individuals

Answer

The monetary wealth possessed by individuals

Question 43

Which of the following is **not** a contributing factor to income inequality in developing countries?

Accepted Answer

Progressive taxation systems

Answer

Unequal access to quality education

Answer

Discrimination based on gender or ethnicity

Answer

Corruption and cronyism

Question 44

Which of the following organizations is an example of a non-governmental organization (NGO) actively involved in development work?

Accepted Answer

Médecins Sans Frontières (MSF)

Answer

World Health Organization (WHO)

Answer

International Monetary Fund (IMF)

Answer

World Bank

Question 45

When did the 'Sustainable Development Goals' (SDGs) replace the 'Millennium Development Goals' (MDGs)?

Accepted Answer

2015

Answer

2010

Answer

2020

Answer

2025

Question 46

Sustainable development strategies prioritize:

Accepted Answer

Meeting the needs of the present without compromising the ability of future generations to meet their own needs

Answer

Pursuing rapid economic growth at all costs

Answer

Reducing poverty without considering environmental concerns

Answer

Increasing inequality to promote economic growth

Question 47

The concept of 'trickle-down economics' suggests that:

Accepted Answer

Economic growth will lead to increased prosperity for all citizens

Answer

Government intervention is essential for economic growth

Answer

Poverty is a result of individual laziness

Answer

Sustainable development is impossible

Question 48

Which of the following is a characteristic of a developing country?

Accepted Answer

Low per capita income

Answer

High literacy rates

Answer

Advanced industrialization

Answer

Stable political systems

Question 49

The 'Washington Consensus' refers to:

Accepted Answer

A set of economic policies advocated by international financial institutions

Answer

A theory of economic development centered on free markets

Answer

A strategy for poverty reduction in developing countries

Answer

A mechanism for resolving international economic disputes

Question 50

The concept of 'inclusive growth' emphasizes:

Accepted Answer

Economic growth that benefits all segments of society

Answer

Rapid economic growth regardless of its social consequences

Answer

Government intervention to redistribute wealth

Answer

Reducing inequality at the expense of economic growth

Question 51

According to the neoclassical development theory, what factor is considered the primary driver of economic growth?

Accepted Answer

Capital accumulation

Answer

Technological progress

Answer

Government intervention

Answer

Foreign aid

Question 52

What is a fundamental principle of sustainable development?

Accepted Answer

Balancing the needs of the present generation with those of future generations.

Answer

Focusing exclusively on economic growth.

Answer

Disregarding environmental concerns.

Answer

Exploiting natural resources without considering long-term consequences.

Question 53

What is a potential benefit of trade for developing countries?

Accepted Answer

It can facilitate economic growth and integration.

Answer

It can lead to increased inequality and exploitation.

Answer

It has no significant impact on development.

Answer

It is primarily beneficial to developed countries.

Question 54

Which of the following is a defining characteristic of developing countries?

Accepted Answer

Low levels of economic development and income.

Answer

High levels of economic development and income.

Answer

A well-diversified economy with a strong manufacturing sector.

Answer

A stable political system and democratic institutions.

Question 55

What is a key role of government in the context of development economics?

Accepted Answer

To regulate the economy and provide essential services.

Answer

To refrain from intervention and allow market forces to drive the economy.

Answer

To take control of all aspects of development and actively intervene.

Answer

To provide financial aid to businesses and individuals without any regulations.

Question 56

According to the widely-held Lewis model of development, which sector is expected to provide the surplus labor needed for industrialization?

Accepted Answer

Subsistence agriculture

Answer

Manufacturing

Answer

Services

Answer

Trade

Question 57

Which of the following is a primary goal of sustainable development strategies?

Accepted Answer

Meeting the needs of the present without compromising the ability of future generations to meet their own needs

Answer

Maximizing economic growth at any cost

Answer

Reducing poverty levels while ignoring environmental impacts

Answer

Promoting foreign investment without considering local regulations

Question 58

Which of the following is a characteristic of a 'failed state'?

Accepted Answer

Inability to control its territory and provide basic services

Answer

High levels of external debt

Answer

Rapid population growth

Answer

Absence of democratic institutions

Question 59

Which of the following is a defining characteristic of developing countries?

Accepted Answer

Relatively low per capita income

Answer

Advanced technological capabilities

Answer

Well-developed infrastructure

Answer

High literacy rates

Question 60

The Harrod-Domar model suggests that economic growth is primarily driven by:

Accepted Answer

Investment and capital accumulation

Answer

Technological innovation and human capital exclusively

Answer

Government spending and fiscal policy alone

Answer

Foreign aid and remittances only

Question 61

Identify a potential benefit of foreign aid:

Accepted Answer

Increased investment in infrastructure and productive sectors

Answer

Guaranteed economic growth irrespective of other factors

Answer

Reduced unemployment without addressing underlying causes

Question 62

The Millennium Development Goals (MDGs) were a set of targets established by the United Nations to:

Accepted Answer

Reduce poverty, disease, and environmental degradation on a global scale

Answer

Promote nuclear disarmament and non-proliferation

Answer

Increase military spending and arms production

Question 63

Which of the following is a key challenge associated with sustainable development?

Accepted Answer

Balancing economic growth with environmental preservation

Answer

Eliminating government regulation and market intervention

Answer

Achieving high levels of consumption without regard to environmental impact

Question 64

According to the Lewis model of development, economic growth can occur through:

Accepted Answer

The transfer of labor from agriculture to industry and services

Answer

Foreign investment as the sole driver of growth

Answer

Capital accumulation as the exclusive factor contributing to growth