Economic Growth and Development: Interactive Learning Quizzes

Question 1

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

Accepted Answer

Accumulation of capital

Answer

Advancement in technology

Answer

Expansion of the labor force

Answer

Government intervention in the economy

Question 2

Which of the following is NOT considered a potential advantage of international trade?

Accepted Answer

Heightened reliance on external markets

Answer

Enhanced specialization and efficiency

Answer

Lower prices for consumers

Answer

Creation of new employment opportunities

Question 3

Which of the following is a characteristic of sustainable economic development?

Accepted Answer

Meeting the needs of the present without compromising future generations

Answer

Prioritizing economic growth above all else

Answer

Exploiting natural resources without regard for environmental consequences

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Increasing pollution and environmental degradation

Question 4

According to the Solow growth model, the primary driver of economic growth in the long run is:

Accepted Answer

Capital accumulation and technological progress

Answer

Labor force growth and technological progress

Answer

Technological progress and natural resource abundance

Answer

Capital accumulation and natural resource abundance

Question 5

In the Harrod-Domar model, which factor has no influence on economic growth?

Accepted Answer

The level of inflation

Answer

The rate of investment

Answer

The rate of population growth

Answer

Technological advancement

Question 6

According to the 'Kuznets Curve' hypothesis, how does income inequality change as a country develops?

Accepted Answer

It initially increases and then decreases.

Answer

It consistently decreases.

Answer

It consistently increases.

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It has no clear relationship with development.

Question 7

What is a fundamental distinction between the Solow-Swan model and the Harrod-Domar model?

Accepted Answer

The Solow-Swan model incorporates technological progress as a factor.

Answer

The Solow-Swan model predicts continuous economic growth.

Answer

The Harrod-Domar model assumes a closed economy.

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The Solow-Swan model assumes a constant capital-output ratio.

Question 8

What is a defining feature of a 'dual economy'?

Accepted Answer

Simultaneous existence of modern and traditional sectors

Answer

High levels of urbanization

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Equitable income distribution

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Low levels of unemployment

Question 9

The 'dependency theory' proposes that:

Accepted Answer

Developing nations are exploited by developed nations.

Answer

Foreign aid is crucial for development.

Answer

Investing in education is essential for development.

Answer

Trade is the primary driver of economic growth.

Question 10

The 'Gini coefficient' measures:

Accepted Answer

Income inequality

Answer

Economic growth

Answer

Human development

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Trade openness

Question 11

What does the 'Washington Consensus' refer to?

Accepted Answer

A set of economic policies advocated by the World Bank and IMF

Answer

A theory of economic development based on free markets

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A critique of development aid policies

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A framework for measuring human development

Question 12

According to the Harrod-Domar model, which factor plays a central role in determining economic growth?

Accepted Answer

Savings rate

Answer

Government expenditure

Answer

Interest rate

Answer

Population growth rate

Question 13

Which of the following is a distinctive feature of endogenous growth models?

Accepted Answer

They emphasize the role of human capital in economic growth.

Answer

They assume economic growth is determined solely by external forces.

Answer

They predict economic growth will eventually reach a stationary state.

Answer

They disregard the impact of government policies on economic growth.

Question 14

The 'Kuznets curve' is a theory that explains:

Accepted Answer

The relationship between economic growth and income inequality

Answer

The relationship between economic growth and environmental degradation

Answer

The relationship between economic growth and political stability

Answer

The relationship between economic growth and human capital

Question 15

Explain the key difference between economic growth and economic development.

Accepted Answer

Economic growth refers to an increase in the size of an economy, typically measured by GDP, while economic development encompasses broader improvements in societal well-being, including factors like health, education, and living standards.

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Economic growth solely focuses on increasing GDP, whereas economic development solely concentrates on improving living standards.

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Economic growth is always accompanied by economic development.

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Both economic growth and economic development are solely quantitative measures of economic progress.

Question 16

Which of the following is NOT a primary factor driving economic growth?

Accepted Answer

Age of population

Answer

Trade

Answer

Technological advancement

Answer

Investment

Question 17

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

Accepted Answer

Low per capita income

Answer

Well-developed infrastructure

Answer

High GDP growth rates

Answer

Strong financial institutions

Question 18

How does trade contribute to economic development?

Accepted Answer

Enhances specialization, efficiency, and technological innovation

Answer

Reduces competition and discourages innovation

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Primarily increases government revenue

Question 19

Which of the following poses a significant challenge to sustainable economic development?

Accepted Answer

Environmental degradation

Answer

Increasing urbanization

Answer

High levels of foreign aid

Answer

Expanding access to education

Question 20

What is the definition of human capital?

Accepted Answer

The knowledge, skills, and abilities embodied in individuals

Answer

The level of government expenditure on education

Answer

The stock of physical capital in a country

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The number of people employed in the formal sector

Question 21

Which of the following is an example of a structural transformation in an economy?

Accepted Answer

Transition from agriculture to manufacturing

Answer

Declining inflation

Answer

Growth in the financial sector

Answer

Increased government spending

Question 22

What is the key distinction between economic growth and economic development?

Accepted Answer

Growth focuses on quantitative indicators, while development encompasses both quantitative and qualitative aspects of well-being.

Answer

Growth always precedes development.

Answer

Development is always more important than growth.

Question 23

Which of the following is a crucial factor in promoting technological progress?

Accepted Answer

Investment in research and development

Answer

Cultural norms

Answer

Abundance of natural resources

Answer

Strict government regulations

Question 24

How can foreign direct investment (FDI) contribute to economic development?

Accepted Answer

It provides capital, technology transfer, and employment opportunities

Answer

It is not essential for developing countries

Answer

It has no impact on economic growth

Answer

It always leads to the exploitation of local resources