A. the brain drains from LDCs to DCs
B. the price role of political and credit-market risk in many LDCs
C. the law of increasing returns that implies that the marginal productivity of capital is higher in LDCs
D. the fat that the DC capital market is perfectly competitive
Related Mcqs:
- Poor developing countries typically impose __________ tariffs than rich advanced nations on imports?
A. lower
B. higher
C. about the same height
D. None of the above - Imitating labor standards from rich countries in LDCs may increase ?
A. equality
B. poverty
C. employment
D. human development - According to the paradox of thrift increased efforts to save will cause ?
A. an increase in income and an increase in overall saving
B. a decrease in income and an overall decrease in saving
C. a decrease in income but an increase in saving
D. an increase in income but no overall change in saving - The idea that suggests that poverty is self-perpetuating because poor nations are unable to save and invest enough to accumulate the capital stock that would help them grow is ?
A. the vicious circle of poverty hypothesis
B. the dependency theory
C. neo-colonialism
D. the under-consumptionist hypothesis - Highly-indebted poor countries (HIPCs) include________________?
I- Bolivia
II- Benin
III- Uganda
IV- TanzaniaA. I and II only
B. I, II , III only
C. I, III and IV only
D. I, II , III and IV - An export quota agreement to stabilize the price of bauxite tends to be more successful when the member producer countries as a percentage of the world’s producer countries is __________ and the _________ it is for the member producer countries to store/stock pile bauxite?
A. relatively small; more difficult
B. relatively small; easier
C. relatively large; more difficult
D. relatively large; easier - Which fixed exchange rates and no private capital flows, to correct a balance of payments deficit, the central bank will _______ and ________ ?
A. buy foreign exchange, sell domestic currency
B. sell foreign exchange buy domestic currency
C. buy foreign exchange buy domestic currency
D. sell foreign exchange sell domestic currency - Keynesian economics became popular because it was able to explain ?
A. stagflation in the late 1970s
B. demand-pull inflation in the 1960s
C. low growth rates in the 1950s
D. The prolonged existence of high unemployment during the Great depression - New classical theories were an attempt to explain ?
A. how unemployment could have persisted for so long during the Great Depression
B. The increase in the growth rate of real output in the 1950s
C. the stagflation of the 1970s
D. Why policy changes that are perceived as permanent have more of an impact on a person’s behaviour than policy changes that are viewed as temporary. - Under a pegged exchange rate system which does not explain why a country would have a balance of payments deficit ?
A. very high rates of inflation occur domestically
B. foreigners discriminate against domestic products
C. technological advance is superior abroad
D. the domestic currency is undervalued relative to other currencies
