Below are a collection of sample test concerns taken from previous exams inDevelopment Economics. The answers are shown by the *. Please notethat it is feasible that concerns might have actually the * in the wrong location.You have to think through all of these.

Also, these are only sample questions. They are put right here bereason students regularly think it is valuable to check out previous exams. The fact that these are below does not recurrent a commitment that concerns on your exam will be likethese or on the very same subject matter. This is specifically so because the subject issue and company of the course has actually recently been readjusted. In addition, as the material covered in between exams transforms semester to semester, the inquiries right here are not damaged into particular exams.

1. A supply side vicious circle of poverty argues that poor nationsreprimary negative bereason a. conserving remains low b. investment continues to be low c. there is a absence of reliable government d. all of the over e.* a and also b over

2. The International Comparisons Project, which used purchasing powerparity rates fairly than market exchange rates, has found that the genuine standard of living in many type of less occurred countries (LDCs) is also reduced than suggested by their dollar per-capita income. a. true b.* false

3. As incomes climb tright here often tends to be a change of labor from the services sector to the industrial sector. a. true b.* false

4. Which of the complying with is not generally an facet in the structural adjust that acservice providers development? a.* increase in the share of agriculture in GDP (gross domestic product)b. boost in manufacturing as a share of GDP c. rise in urbanizationd. All of the over alters accompany breakthrough

5. The significance of Engel"s law is that as household incomes rise a. the savings rate rises b.* the propercentage of earnings spent on food declines c. expenditure on food declines d. proportion of income spent on luxuries declines

6. Economic growth procedures the a. growth of efficiency b. increase in nominal revenue c.* boost inoutput d. namong the over

7. Non-traded goods do not enter measured GDP because a. they are intermediate products b.* they are not traded in the industry c.there is no value-included in the production of such items d. their value isnot recorded by the exadjust rate strategy of convariation to a widespread unit

8. The principle of opportunity price is based upon the principle of a. need b. intake c.* scarcity d. profit

9. Which of the complying with is an INCORRECT statement around a budacquire constraint a. Points on a budacquire constraint represent combinations of the goods that exactly use up earnings b. Points within the budget constraint recurrent combicountries of the items that carry out not usage up all the income. c.* If points A and B lie on the budobtain constraint, we can deduce that people will certainly be invarious between the 2 d. If the price of one good decreases, all else the very same, the budacquire constraint will certainly swivel or revolve external

10. When the manufacturer of power looms increases, there are forward linkage impacts because of a. lost employment in the hand-loom sector b. enhanced incomes of workers that manufacture looms c.* enhanced output of wstove fabric made by the power looms d. enhanced demand for electric motors

11. Economic growth is necessary and also enough to eradicate the majority of of absolute poverty. a. true b.* false

12. Income level or GDP is criticized as an indicator of breakthrough greatly because it takes no account of the circulation of revenue. a.* true b. false

13. A certain amount of items and services is crucial for a minimumstandard of living. This is dubbed a.* fundamental requirements b. absolute poverty c. an worldwide conventional of living d. the idea of breakthrough

14. With perfect revenue equality the Gini coreliable in a country would certainly be a. infinity b. 1 c. .5 d.* 0

15. Rawls argued that the earnings distribution must be determined a. by a complimentary vote of all groups on a culture b. by whatever before the negative decide is an acceptable minimum level c.* by what all culture agrees to behind a `veil of ignorance" d. as entirely equal income shares for all teams

16. All yet one of the following are techniques to represent overall income inequality: a. variance b. Gini coreliable c. ratio of the peak revenue decile to the lowest income decile d. Lorenz curve e.* GDP per capita

17. The idea of choice would certainly come to be irpertinent if a. we were dealing with an extremely simple, one-perboy economic situation b. poverty were got rid of c.* scarcity was eliminated d. capital was got rid of

18. Examine the complying with diagram: The Gini coreliable is

a.* A/(A+B) b. B/(B+A) c. A/B d. (A+B)/A

19. According to Simon Kuznets, the partnership between GNP per capita and also inetop quality in the circulation of earnings can be expressed as a. a strictly decreasing partnership b. a strictly enhancing partnership c. no relationship d.* first raising and then decreasing

20. The physical high quality of life index (PQLI) is an aggregation of extensively available signs of fundamental huguy needs. Which of the adhering to is nota component of the PQLI: a. life expectancy b.* per capita earnings c. infant mortality d. literacy

21. If Lorenz curves cross, we say tright here is much less inequality in the instance wbelow a. the poorer gain a larger percent of revenue b. the poorer gain a smaller percentage of income c. the richer are much less affluent d.* we cannot say

22. If the advancement procedure is identified by what we have called "contemporary sector enlargement", the connection in between GNP per capita andinequality in the circulation of revenue can be expressed as a. a strictly decreasing partnership b. a strictly raising relationship c. no connection d.* first enhancing and then decreasing

23. If the breakthrough process is identified by what we have called "modern sector enlargement", the connection in between GNP per capita andpoverty in the distribution of earnings can be expressed as a.* a strictly decreasing connection b. a strictly enhancing relationship c. no partnership d. first increasing and also then decreasing

24. Whereas the headcount meacertain tells us the number of negative and thepoverty gap measure tells us about the average depth of poverty among thenegative, the Foster-Greer-Thorbecke meacertain (likewise referred to as P-alpha) tells us aboutthe number, the average depth of poverty and also a. average earnings b. inequality in the populace c.* inehigh quality among the bad d. variance of average revenue

25. The principle of Purchasing Power Parity a. is based upon the cost of hamburgers approximately the human being b.* is based upon the expense of the same sector basket of products in different countries c. is basedupon the market exreadjust price d. is based upon the nominal exchange rate

26. If the distribution of revenue in nation C is (1, 2, 2, 3, 5) andthe poverty line is 2.5, the headcount meacertain tells us what portion ofthe populace is in poverty a. 40 b. 3 c. 2 d.* 60

27. If the circulation of revenue in country C is (1, 2, 2, 3, 5) andthe poverty line is 2.5, the average earnings shortloss meacertain tells us theaverage depth of poverty among the negative is a.* 5/6 b. 5/2 c. 2 d. 0

28. If the distribution of revenue in nation C is (1, 2, 2, 3, 5) , and in nation D it is (1, 1, 2, 3, 5), and also the poverty line in both countries is 2.5, by the headcount meacertain which country has actually more poverty? a. C b. D c.* poverty is the same in C and D d. we cannot tell from theinformation given

29. If the circulation of income in nation C is (1, 2, 2, 3, 5) , and in country D it is (1, 1, 2, 3, 5), and the poverty line in both countries is 2.5, by the average revenue shortautumn meacertain which nation has even more poverty? a. C b.* D c. poverty is the same in C and also D d. we cannot tell from theinformation offered

30. If the circulation of income in nation C is (1, 2, 2, 3, 5) , and in country D it is (1, 1, 2, 3, 5), and also the poverty line in both nations is 2.5, by the Lorenz curve which country has actually more inequlity? a. C b. D c. inehigh quality is the exact same in C and also D d.* we cannot tell from the information given.

31. The empirical evidence indicates that today"s occurring countries are undergoing a demographic change incredibly similar to what the developed nations experienced in the previous. a. true b.* false

32. The dependency proportion is the proportion of a. youngsters to adults in the populace b. unemployed to employed workers in the labor force c. international assist to full GNP d.* non-functioning age grouppopulace to functioning age populace

33. Malfor this reason suggested that the negative would certainly constantly remajor poor because a.* population expansion has a tendency to outrun expansion of food manufacturing b. theydo not save sufficient c. tright here are not enough resources to educate them d. all of the above

34. Compared to the developed nations, the LDCs have a. greater birth rates and lower fatality rates b.* higher birth prices and better fatality prices c. lower birth prices and also reduced death rates d. reduced birth rates and also higher death rates

35. Children have actually prices and benefits to parental fees, and also a. fathers and also mothers share these equally b. the influence on family members revenue is constantly negative, so children deserve to be perceived as customer durables c.* tbelow is a profession off to parental fees in between amount and top quality of children d. the income elasticity of demand also for children is strongly negative e. none of theabove

36. Both the Ricardian expansion design and also the Lewis model share the assumption that populace growth will certainly outpace food manufacturing in the lengthy run. a. true b.* false

37. The Lewis model of the dual economy makes the following assumption(s) a. The rural wage initially remains continuous b. Indusattempt renders a profitby employing cheap labor c. Rural wage will increase when industry expands sufficiently d.* all of the over e. none of the over

38. Indusattempt encounters an elastic supply curve of labor bereason the marginal product of labor in farming is a. lower than its marginal product in sector b. much less than the averageproduct in agriculture c.* very low or zero d. constant at all levels offarming output

39. Underemployment is a situation wright here a. human being that are willing to job-related are unable to find jobs b. many type of peoplein the labor pressure organize two or even more jobs c.* human being are working full-timeand difficult, yet have actually a low marginal product d. people work-related in a cost-free laborindustry through a very low wage

40. The Malthusian theory of population growth, as formulated by Maltherefore, showed a. entirely correct for huguy habits b.* overly pessimistic about future performance boosts c. that food output will certainly decline via populace expansion d. none of the over

41. The endogenous growth version confirms the neoclassical model"s implications about convergence. a. true b.* false

42. An LDC has actually an ICOR of 5 and also a savings rate s = 15%. If present GDP is $1000, what will be GDP following year? a. $1150 b. $850 c. $1200 d.* $1030

43. The hypothesis of the "benefit of backwardness" a. explains exactly how LDCs might catch-up in efficiency b. implies that currently well-known innovation deserve to be moved fairly cheaply from the advancedcountries to the LDCs c. is incorrect; there are no benefits to backwardnessd.* a and also b above

44. "L" shaped isoquants execute not imply a. that inputs are supplied in resolved proportions b. increpsychological capital-output ratio is consistent c.* boosting returns to range d. no substitution in between inputs

45. Which is a measure of absolute poverty? a. Headcount. b. average income shortloss. c. Sen index. d.* every one of theabove.

46. The Lorenz criterion a. enables us to rank all nations by the degree of inehigh quality. b. allows us to rank all countries by the degree of poverty. c. is a measure of the riches of a country. d.* is an infinish measure of inehigh quality.

47. Consider the following circulation of incomes in country x and also country y: nation x (2, 3, 4) country y (6, 9, 12) a. inetop quality is better in x than in y. b. inehigh quality is higher in y than in x. c.* inehigh quality is the very same in x and also y. d. the indevelopment offered is notenough to compare inehigh quality in x and y.

48. Consider the following circulation of incomes in nation x and also country y: nation x (2, 3, 4) country y (6, 9, 12) a. absolute poverty is greater in x than in y. b. absolute poverty is higher in y than in x. c. absolute poverty is the same in x and y. d.* the indevelopment provided is not enough to compare absolute poverty in x and also y.

49. Consider an economy via low per capita income. Assume i) whenever per capita earnings rises over subsistence level, population grows and also ii) whenever before it falls below subsistence level, population shrinks. Given, i)and ii), a.* a poverty trap exists. b. an important minimum initiative raising per capita earnings by 1.5% per annum is important for breakthrough to take area. c. the economic situation is ready for Rostow"s take-off stage. d. namong the above.

50. Which of the following would certainly not be thought about as an example of industrialization a.* Increase in literacy b. Replacement of huguy via mechanical skillsc. Imshowed financial company d. Imconfirmed extraction and functioning of raw products

51. The production possibility frontier have the right to be thought about a measure of a. Real G.N.P. b. Nominal G.N.P. c.* Potential G.N.P. d. None of the over

52. Many lists of fundamental humale demands incorporate all the adhering to items other than a.* basic transportation, such as bicycles. b. minimal levels of nutrition c. minimal provision of shelter d. provision of fundamental health and wellness care

53. Rising per-capita GNP may fail to increase incomes for many citizens because: a. Gains from development might be supplied for expensive glory projects that provide few concrete benefits to the people. b. gains from expansion may be heavily reinvested,so intake gains are postponed c. Those that are already reasonably well-offmight gain all or a lot of of the benefits d.* all of the over

54. The concept which suggests that poverty is self-perpetuating becausepoor countries are unable to save and also invest enough to accumulate the capitalstock that would assist them flourish is a. the dependency theory. b.* the vicious-circle-of-poverty hypothesis.c. neo-colonialism. d. the under-consumptionist hypothesis.

55. If the vicious-cycle-of-poverty hypothesis were true at all levels of per capita revenue, then a. all economic situations would certainly build at the same price. b.* no nation might ever before accomplish financial advancement. c. no nation would ever before fail to reach the greatest level of financial breakthrough. d. poverty would not be self-perpetuating.

56. The absolute poverty line: a. must be readjusted from time to time as genuine income grows b. mirrors the average income of the lowest 10 percent of the populace c. varies through theGini coefficient d.* none of the above.

57. The Gini coeffective offers a measure of: a. the level of poverty b.* the level of family member inequality c. disguised joblessness d. the rate of development

58. To draw a Lorenz curve showing the circulation of revenue by household, one have to initially rank all families according to a. household size. b. age of head of household. c. wage level. d.* earnings per capita.

59. One examine uncovered that the Gini coefficient for Egypt .403 . was practically the very same as that for Australia .404. From this information one can conclude that Egypt and also Australia a. had virtually the same number of family members in absolute poverty. b. had actually virtually the exact same percentage of family members in absolute poverty. c. had actually basically the exact same Human Development Index level. d.* none of the over.

60. According to the inverted U hypothesis of Kuznets, as economies construct a. average family incomes initially loss and also later climb. b. industry"s share of GNP initially rises and also later drops. c.* income inequality initially rises and also later drops. d. the population expansion rate first rises and later on drops.

61. If "s" is the savings price and "v" the capital-output ratio, then"g" the price of growth in the Harrod Domar design is stood for by a. v/s. b. sv. c. sv. d.* s/v.

62. Balanced development theories of Ragnar Nurkse advocate a. a steady rate of growth of GNP b. parity in between funding stock and also labor c.* simultaneous advance of all sectors of the economy d. all of the above.

63. Critical minimum initiative refers to a. the minimum labor input forced to raise the MPl b. the appropriate ratioin which to integrate labor through capital c.* the massive press promoted to raisean economy from continued stagnation d. namong the above.

64. The Arthur Lewis design uses the assumption that, a.* an limitless supply of labor is easily accessible at a fixed wage rate b. supply of labor is a strictly raising feature of wage price c. labor supply grows at a resolved rate d. disguised unemployment need to not exist in the farming sector.

65. If a country experiences a rapid increase in per-capita earnings as a result of discovery of new oil reserves, then it is experiencing: a.* growth yet not necessarily advance. b. advance but not growth. c. both development and development. d. neither growth nor advance.

66. According to Kuznets, the identifying characteristic of "contemporary financial growth" is a. development of hefty market. b. a rapid decrease in population growthrates. c.* high rates of conserving and investment. d. application of scienceto problems of financial manufacturing.

67. In constant 1968 lira, actual GNP in Turvital boosted from L206.1 billion in 1980 to L214.7 billion in 1981. Investment in 1980 totaled L43 billion. What was the worth of the ICOR? a.* 5. b. 0.176. c. L8.6 billion. d. It cannot be established from thesedata.

68. All yet one of the complying with facets is a characteristic of the demographic transition. Which one is the exception? a. Initially high birth price and fatality price. b. At first low rate of natural rise. c.* Rapid increase in the birth rate during the at an early stage stages of advance. d. A sharp loss in the death price complied with with a lag by a decrease in the birth rate.

69. The supply curve of labor to industry is horizontal if tright here is surplus labor in farming. The problem occurs as lengthy as: a. the marginal product of labor in farming is much less than the averageproduct of labor. b. the marginal product of labor in agriculture is lessthan the marginal product of labor in sector. c. tright here are diminishingreturns to labor in farming. d.* the marginal product of labor in agricultureis zero.

70. Which of the adhering to statements is consistent through Hirschman"ssconcept of unwell balanced growth? a. A nation need to emphasis on sector, bereason farming is not a dynamic sector. b. To initiate the industrialization procedure a nation needs a "substantial press." c. When particular industries are arisen first, link impacts will induce the advancement of new industries. d.* All of the over.

71. Which of the complying with is a direct implication of the check out that childbearing is an economic decision? a. People will not have additional children unless they have the right to earn a profit from doing so. b. Social determinants have actually no impact on childbearing decisions. c. Compulsory education will increase fertility by elevating each child"s prospective earnings. d.* Fertility must fall through boosted opportunities for woguys to job-related in jobs external the house.

72. The major emphasis of advance strategy during the 1950"s was on a. Reduction in unemployment, b.* Increase in G.N.P., c. Increase in foreign trade, d. Increase in proficiency

73. The extractivity of iron ore has raised on account of raised demand also for steel. The above is an instance of a. Forward linkperiods, b.* Backward linkeras, c. Backward and also forward linkages, d. None of the above

74. According to W.W.Rostow, which of the following does not belengthy to the "precondition for take off": a. Increased agricultural performance, b. Political stcapacity, c. Advancement of social overhead resources, d.* Growth of the resilient consumer items sector

75. If a instance exists wright here it is not profitable for any single producer to expand also production because of sector limitation, then the finest strategy for the nation to adopt would certainly be a.* Balanced expansion strategy, b. Unbalanced expansion strategy, c. Employment expansion strategy, d. None of the over

76. An unwell balanced expansion strategy may be desirable if a. Indivisibilities are important, b. Expansion costs are important, c.* Both of the over, d. Namong the over

77. Which of the following is not true about agriculture"s duty in financial advancement a. Provides labor for non-agricultural sector, b. Provides a market fornon-agricultural products, c. Source of commercial raw products, d.*Namong the over

78. Which of the adhering to is not a weakness of the import substitution strategy of expansion a.* Reduces manufacturing of contemporary sector, b. Leads to an incorrect residential K/L proportion, c. Leads to a balance of payments problem, d. Reduces exports offarming goods

79. According to the Harrod-Domar model, an increase in development prices relies on a. Increase in capital-output ratio b.* Decrease in capital-output proportion, c. Increase in marginal propensity to consume, d. Namong the above

80.In the Harrod-Domar version, it is assumed that the elasticity of substitution in between capital and also labor is a. Infinite, b. One, c. Between zero and also one, d.* Zero

81. In the theory of demographic transition, the rate of growth of population is most likely to increase in a. Period I, b.* Period II (c) Period III (d) Period I & II

82. According to Malthus, the fixed aspect of production is a. Labor, b. Capital, c.* Land also, d. Entrepreneurship

83. According to Maltherefore, examples of preventative checks are a. Abortion, b.* Deferred marital relationship, c. Starvation, d. Both a and b

84. In a perfectly competitive economic situation, if the demand curve for laboris infinitely elastic then all of the national earnings will accrue to a.* Workers, b. Capitalists, c. Landlords, d. Namong the above

85. According to A. Sen, famines are many most likely to happen on account of a. Fall in manufacturing of agricultural goods, b.* Breakdown in distribution of farming goods, c. Adverse weather problems, d. Fall in money supply

86-90. Suppose tright here are 5 employees in an economic situation and initially all the workers job-related in the traditional sector at a wage equal to 1 (speak to this initial duration, duration 0). In each succeeding period, one worker migprices from the standard sector to the modern-day sector wbelow weras are equal to 4. Assuming that the number of employees stays continuous, then duration 5 all the employees are in the modern sector.

86. In period 5 the gini coeffective of inetop quality is a. 1, b. 0.5, c.* 0, d. Namong the above

87. As migration takes location the gini coreliable of inehigh quality a.* At first rises,then drops, b. At initially falls,then rises, c. Falls repeatedly, d. Rises consistently

88. As migration takes location the income share of the poorest 50% a. At initially rises,then falls, b.* At initially drops,then rises, c. Falls continuously, d. Rises consistently

89. As migration takes place the per capita revenue of the employees a. At first rises,then drops, b. At initially falls,then rises, c. Falls consistently, d.* Rises repeatedly

90. The income share of the poorest 20% is most likely to be at a minimum in which duration a. Period 2, b. Period 3, c.* Period 4, d. Period 5

91. Suppose we hypothedimension that weras are set at a subsistence level.Then what monitoring will certainly strengthen our hypothesis a. Tbelow is no involuntary joblessness, b.* Weras execute not loss as laborproductivity alters, c. Weras loss in the slack agricultural seasons, d.Namong the above

92. In a fixed rent tenancy, risk is a.* Borne by the tenant, b. Borne by the landlord, c. Shared between landlord and also tenant, d. None of the over

93. Which of the following is not a justification for sharecropping a. It acts as a screening device, b. It shares risks in between landlord and tenant, c. It reduces expense of supervision for the landlord, d. Namong the over

94. Rural interest prices are most likely to be a.* Higher than in the organized crmodify industry, b. Same as in the arranged crmodify industry, c. Lower than in the organized crmodify sector, d. None ofthe over

95. In the Harris-Todaro model, in equilibrium, the meant city wage rate will be _________ the rural wage price a. Greater than, b.* Equal to, c. Less than, d. None of the above

96. Suppose migrants are risks averse, then in the Harris-Todaro model, in equilibrium, the expected urban wages will certainly be _________ the rural wage rate a.* Greater than, b. Equal to, c. Less than, d. None of the above

97. Which of the complying with is not an instance of financial repression a. Forced sales of government debt to the banking device, b. Interemainder rate controls on loan and deposit prices, c. Very high rates of monetary expansion, d.* Creation of a big public sector

98. According to the Ricardian model, the reason for reduced priced services in the LDC"s is a. Labor -performance in commodities is the same in affluent and bad nations, b.* Labor-efficiency in products is lower in negative nations, c. Labor-productivity in solutions is reduced in bad countries, d. None of the above

99. Which of the following statements is not true around import restriction a. Import limitations lure sources to safeguarded industry, b. Import constraints involve a deadweight loss, c. Import limitations raise prices for buyers to a product, d.* Import restriction transition welfare from producers to consumers

100. In a non-Harris-Todaro civilization, if it is observed that poverty is extremely correlated through joblessness then which choice of approaches is most likely to alleviate poverty a.* Labor extensive methods, b. Capital extensive techniques, c. Profit maximizing methods, d. Namong the over

101. If the birth price is 6% and the death price is 2%, the organic price of population boost is a. 0 .3% b. 3.0% c.* 4.0% d. 8.0%

102. Historically, low price of population development were maintained because of a. low fertility prices. b.* high mortality rates. c. migration out of emerging nations. d. government restrictions on the number of kids families canhave.

103. The primary domestic source of savings in LDCs is a. federal government savings via budobtain surplus b. corpoprice kept income c.* savings by households d. savings by public sector enterprises

104. During years of financial repression in LDCs, the real interemainder rate was regularly negative due to: a. explicit policy by the federal government b. low interemainder rates instituted by government to encourage resources investment c. federal government policy to combat inflation d.* an inadvertent outcome of inflation arising after nominalinteremainder rates had been addressed.

105. The LDCs desire international capital in the form of a. loans as soon as they desire to retain manage of domestic sector b. equitywhen they want to share threats via foreign investors c. irreversible loans forlong-term facilities jobs d.* all of the over

106. If the marginal product of capital is twice that of labor and also the price of capital is 3 times that of labor, then, a. funding will be substituted for labor b.* labor will certainly be substituted for resources c. the price of funding will certainly fall, and also price of labor will certainly rise d. twice as much resources as labor will certainly be employed

107. Investment in funding suggests a. future sacrifice for existing get b. buying financial assets such asstocks or bonds c. no sacrifice bereason it leads to development d.* a presentsacrifice for expected future get

108. Autarky refers to a country a. through an authoritarian federal government b.* which is self enough, and is a closed economy c. which has actually cost-free trade with the rest of the human being d. none of the over

109. A public works jobs pay $5 a day to poor rural laborers who would otherwise earn only $2 per day from casual labor. The chance expense, or shadow wage price, of labor is: a.* $2 b. $3 c. $5 d. $7

110. Peasant farmers in LDCs are primarily observed to a. respond accordingly to changes in price incentives b. usage availablesources properly c.* Both a and b d. Neither a nor b

111. In the family manufacturing design, agents select their hours andtype of occupational so regarding maximize: a. manufacturing b. earnings c.

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leicertain d.* utility e. short-run usage