Chapter 10: Development

Foreign direct investment (FDI) is defined as the investment in the economy of another country by a. the World Bank. b. the International Monetary Fund. c. a non-government organization. d. a foreign company. e. a foreign government.

d. a foreign company.

Which is a secondary sector economic activity? a. government b. mining c. banking d. construction e. data processing

d. construction

Severe gender inequality poses a challenge to development because it a. is associated with higher literacy rates, higher economic vitality, and lower infant mortality rates. b. leads to smaller family sizes, and families with fewer child laborers cannot earn enough money to pay for rent and utilities. c. does not allow men and boys the freedom to attend the schools and seek the jobs that are best suited to them. d. severely limits the economic and social mobility of women, as well as families that are headed by women. e. excludes men from the informal economy, wasting a major economic asset.

d. severely limits the economic and social mobility of women, as well as families that are headed by women.

Which of the following definitions of the adolescent fertility rate is correct? a. the number of teenagers ages 13 to 19 within a country b. the number of teenage women who die giving birth per 100,000 births c. the level of access to contraception among teenage women in a country d. the number of births per 1000 women ages 15 to 19 e. the number of births per 1000 women

d. the number of births per 1000 women ages 15 to 19

The productivity of workers is higher in more developed countries because they a. have a low amount of value added per person. b. understand their jobs better than workers in less developed countries. c. work harder. d. are consistently better educated. e. have access to more technology.

e. have access to more technology.

Use Figures 10-4 and 10-5 to answer the question. Which semi-peripheral country is categorized as very high developed? a. Argentina b. New Zealand c. Japan d. Spain e. Australia

a. Argentina

Which of the following would NOT be considered an asset of a country following the international trade approach to development? a. limits on import b. high quality manufactured goods c. abundant mineral resources d. abundant agricultural products e. international consumer preferences

a. limits on import

Structural Adjustment Programs for refinancing loans to developing countries are often criticized for resulting in a. loss of jobs in state enterprises and support for dependent citizens being cut. b. increased dissemination of information to the public. c. diversion of investment from weapons and training for the military to social needs such as health and education. d. a more efficient civil service. e. investment that benefits the poor, not just the elite.

a. loss of jobs in state enterprises and support for dependent citizens being cut.

Which of the following is an example of the relationship between goods such as cellphones, cars, or the Internet and development? a. Consumer goods increase an individual's ability to access services, information, and employment. b. Transportation and infrastructure investments serve to increase a country's rural-urban divide. c. Employment opportunities are accessed through the Internet only in developed countries. d. Low income countries limit development opportunities by restricting access to phones and cars to the elite. e. The U.N. can monitor development through the Internet and assess a country's needs.

a. Consumer goods increase an individual's ability to access services, information, and employment.

Which of the following measurements examines how the level of development varies within a country? a. Inequality-adjusted Human Development Index b. gross national income c. Human Development Index d. purchasing power parity e. literacy rate

a. Inequality-adjusted Human Development Index

Which statement best summarizes the U.N.'s view of gender inequality? a. Gender inequality is only present in the secondary sectors of economic activity. b. Gender inequality is a major factor preventing a country from achieving a higher level of development. c. Gender inequality is less important than literacy rates. d. A country with a high gender development index can have gender equality. e. Gender inequality only applies to teen mothers in developed countries.

b. Gender inequality is a major factor preventing a country from achieving a higher level of development.

Use Figure 10-9 to answer the question. Which developing region has experienced the greatest increase in HDI? a. Central Asia b. South Asia c. East Asia d. Southeast Asia e. Southwest Asia & North Africa

c. East Asia

Which is NOT a characteristic of the fair trade movement? a. Developing countries institute standards to protect workers. b. Fair Trade business practices increase entrepreneurial and managerial skills of producers. c. Cooperatives benefit local farmers and artisans, rather than absentee corporate owners. d. Protection of workers' rights by multinational corporations. e. Employers must pay fair wages and comply with environmental and safety standards.

d. Protection of workers' rights by multinational corporations.

Development is best defined as the improving the conditions of people by a. diffusing the American way of life. b. shifting the economic ideology from an entirely capitalist mode to a blended economy. c. improving diplomatic ties. d. becoming a federal state. e. increasing diffusion of knowledge and technology.

e. increasing diffusion of knowledge and technology.

Use Figure 10-9 to answer the question. Which developed region has had the greatest increase in HDI? a. North America b. South America c. Japan and South Korea d. Russia e. South Pacific

c. Japan and South Korea

Use Figure 10-7 to answer the question. Other than sub-Saharan Africa, which regions have made the greatest progress in reducing the maternal mortality rate between 1990 and 2015? a. Central Asia and North Africa b. Russia and Europe c. Latin America and North America d. South Asia and Southeast Asia e. Australia and the South Pacific

d. South Asia and Southeast Asia

Which of the following statements about the Grameen Bank is NOT TRUE? a. Loans made to women are so small they do not need to be paid back. b. Beneficiaries are often the sole wage earner in their families. c. Its founder was awarded the Nobel Peace Prize. d. Women make up three-fourths of the borrowers. e. Microfinance is designed to help those who cannot qualify for traditional bank loans.

a. Loans made to women are so small they do not need to be paid back.

In which regions are literacy rates the lowest? a. South Asia and Sub-Saharan Africa b. Sub-Saharan Africa and Eastern Europe c. Eastern Europe and Latin America d. Central Asia and South Asia e. Sub-Saharan Africa and Southeast Asia

a. South Asia and Sub-Saharan Africa

Which statement best describes progress made toward reducing the development gap since 1980? a. The gap in HDI between developed countries and developing countries has narrowed. b. Mean years of education have increased only in developed countries. c. The gap in GNI per capita has stayed about the same. d. The gap in life expectancy has actually increased. e. The gap in infant mortality rates has increased.

a. The gap in HDI between developed countries and developing countries has narrowed.

In contrast to the international trade approach, the self-sufficiency approach to development a. attempts to spread investment through all sectors of the economy. b. attempts to increase imports. c. begins when an elite group initiates innovative activities. d. suffers from market stagnation. e. tends to result in uneven resource development.

a. attempts to spread investment through all sectors of the economy.

When were the World Bank and the IMF established? a. just before the end of WWII b. at the same time as NATO c. after the Vietnam War d. just before the end of WWI e. at the same time as the League of Nations

a. just before the end of WWII

Development levels are reflected by education indicators because a. literacy and education help measure ability to earn a living. b. young people cannot fully develop without 12 years of school. c. pupil-teacher ratios are responsible for limiting a country's development. d. the percentage invested in education per pupil is higher based on a country's GNI. e. free public school creates equal access to development opportunities.

a. literacy and education help measure ability to earn a living.

Gross domestic product (GDP) is the total value of a. outputs of goods and services produced in a country during a year. b. investments made in domestic and foreign sources of revenue during a year. c. human capital development in a country during a year. d. the outputs minus inputs of goods and services produced in a country during a year. e. exports of goods and services produced in a country during a year.

a. outputs of goods and services produced in a country during a year.

Which of the following is NOT a likely result of a country's concentration on international trade? a. support for political and economic equity b. projection that competition will introduce higher quality products c. benefits from exposure to demand in other countries d. benefits from sale of natural resources at a fair market price e. promotion of domestic development

a. support for political and economic equity

Select the statement regarding fair trade standards that is correct. a. Children may be in the workforce provided they are paid a fair wage. b. Fair trade labor standards protect workers' rights by guaranteeing fair wages as well as minimum environmental and safety standards. c. Fair trade offers less protection for workers than governments and international lending agencies provide. d. Fair trade standards require employers to pay workers fair wages in return for a promise not to organize into unions. e. Fair trade standards address only wages and not environmental or social issues.

b. Fair trade labor standards protect workers' rights by guaranteeing fair wages as well as minimum environmental and safety standards.

Which statement accurately provides an explanation for the success of the international trade model? a. Because natural resources are evenly distributed, all countries benefit from the international trade approach. b. In a global economy, independent countries with valuable natural resources can sell them on the world market to raise revenue for development projects. c. Even if lacking abundant natural resources, developing countries can purchase raw materials from developed countries, thus promoting development in all regions. d. A country engaged in international trade can ignore the demands and preferences of people in other countries. e. Inefficient businesses are protected by complex administrative systems.

b. In a global economy, independent countries with valuable natural resources can sell them on the world market to raise revenue for development projects.

Which of the following indicators is the primary measure of access to knowledge used by the United Nations? a. quality of schooling b. years of schooling c. literacy rate d. percentage of adults completing college e. pupil/teacher ratio

b. years of schooling

Which statement best describes the health component of the Human Development Index (HDI)? a. The age ratio of people under 15 and over 65 is similar in developed countries. b. The health indicator used in the HDI is life expectancy at birth. c. The region with the highest scores on health indicators is North America. d. Better health and welfare programs in developing countries contribute to their higher life expectancies. e. The HDI score is based exclusively on health factors.

b. The health indicator used in the HDI is life expectancy at birth.

Which global effort was replaced by the Sustainable Development Goals? a. structural adjustment programs b. UN Millennium Goals c. World Bank lending practices d. Fair Trade movements e. stimulus programs

b. UN Millennium Goals

According to Rostow's development model, the process of development begins when a. a high percentage of national wealth is allocated to nonproductive activities. b. an elite group supports investments in technology and infrastructure. c. banking institutions are sufficiently mature. d. take-off industries achieve technical advances. e. workers become more skilled and specialized.

b. an elite group supports investments in technology and infrastructure.

Which is a characteristic of cooperatives? a. short-lived stepping stones to traditional sales organizations b. democratically governed organizations that improve the community c. have limited appeal in communities because there is no opportunity for participation d. typically owned by corporations e. largely financed by commercial lenders

b. democratically governed organizations that improve the community

Which of the following indicators would NOT be used to measure a decent standard of living? a. level of GNI per capita b. gross domestic product (GDP) c. purchasing power parity (PPP) d. per capita income e. cost of basic goods in relation to income

b. gross domestic product (GDP)

Which would NOT be a goal of fair trade producer standards? a. distribute profit and risk more equitably across the production chain b. increase the role of individual governments in management of the businesses c. promote safe and sustainable agriculture and working conditions d. raise incomes of small-scale farmers e. increase entrepreneurial skills

b. increase the role of individual governments in management of the businesses

Use Figure 10-2 to answer the question. The inequality-adjusted human development index (IDHI) of China is a. greater because the Chinese economy is growing and creating jobs. b. lower than that of Canada and most Western European countries. c. greater than any other country in Asia. d. lower than that of Russia but higher than that of most South Asian countries. e. lower than that of Western European countries but far greater than that of India.

b. lower than that of Canada and most Western European countries.

Which is NOT one of the Sustainable Development Goals? a. conserve and sustainably use the oceans, seas, and marine resources b. promote economic growth and industrialization through urban development c. achieve gender equality and empower all women and girls d. ensure sustainable consumption and production patterns e. end hunger, achieve food security and improved nutrition, and promote sustainable agriculture

b. promote economic growth and industrialization through urban development

A country with the lowest HDI in the world is likely to be located in a. Latin America. b. sub-Saharan Africa. c. Central America. d. Central Asia. e. Europe.

b. sub-Saharan Africa.

Women's empowerment refers to a. economic and social support for single mothers. b. the ability to achieve economic and political power. c. a constitutional guarantee of equal pay for equal work. d. permission to serve in the military. e. a constitutional guarantee that women have the right to vote.

b. the ability to achieve economic and political power.

Which statement about the need for an IHDI is INCORRECT? a. The U.N. developed it as a measure of the extent of inequality between countries. b. Countries may have excellent education and health care, but those benefits do not extend to women. c. Most countries are working to improve their HDI to match their IHDI. d. Because inequality persists at many levels and scales, a more specific measure is useful. e. Countries may report high levels of income, education, and health care but they may not be accessible to many people.

c. Most countries are working to improve their HDI to match their IHDI.

Which of the following statements comparing the Human Development Index (HDI) and the Gender Inequality Index (GII) is correct? a. The higher the GII, the lower the level of gender inequality. b. Most developed countries have low HDIs and high GIIs. c. Most developed countries have lower GIIs and higher HDIs than developing ones. d. The HDI and GII are the same for all countries. e. Most developing countries have higher HDIs and GIIs than developed ones.

c. Most developed countries have lower GIIs and higher HDIs than developing ones.

What are the three factors that comprise the Human Development Index (HDI)? a. life expectancy, maternal mortality, and overall quality of healthcare b. average income per person, percentage unemployed, and government spending per person c. decent standard of living, long and healthy life, and access to knowledge d. level of college education, consumer purchasing power, and maternal health e. female labor force participation rate, average level of education for women, and level of female representation in government

c. decent standard of living, long and healthy life, and access to knowledge

Development analysts expect that a more developed country is likely to have a a. low HDI and low GDP per capita. b. low GII and a low HDI. c. high GII and a high HDI. d. low GII and a high HDI. e. high GII and low HDI.

d. low GII and a high HDI.

Compare the two paths to development, and select the statement that represents the self-sufficiency path. a. Countries identify their unique resources and then concentrate their scarce resources on expanding those globally distinctive industries. b. Governments reduce taxes on imported goods to make them more affordable. c. Countries develop by producing goods for export and increasing the quotas on imported goods. d. Fledgling businesses are isolated from global competition, and license requirements restrict the number of legal imports. e. Countries go through five stages of development that end with a shift toward production of consumer goods for mass consumption.

d. Fledgling businesses are isolated from global competition, and license requirements restrict the number of legal imports. *Remember: Under self-sufficiency, countries encourage domestic production of goods, discourage foreign ownership of businesses and resources, and protect their businesses from international competition.

For which indicator has the gap between developed and developing widened since 1980? a. mean years of education b. life expectancy c. human development index (HDI) d. per capita gross national income (GNI) e. food security

d. per capita gross national income (GNI)

Which of the following statements is a criticism of structural adjustment programs? a. Structural adjustment reforms impact only a country's political system and do not address economic issues. b. Loans are forgiven without consequences. c. Additional money is given to a country to build its military. d. Reforms necessary to secure financing may actually increase poverty levels. e. Money is given to a country with no strings attached.

d. Reforms necessary to secure financing may actually increase poverty levels. *Remember: Structural reforms in developing countries allegedly punish the poorest people through reduction of social services and education, for actions they did not commit, such as waste, corruption, misappropriation, and military buildup.

The biggest problem faced by developing countries in financing development is a. promoting dependency. b. identifying unique economic assets. c. currency inflation. d. inability to repay loans. e. trade negotiations with more developed countries.

d. inability to repay loans.

Which of the following statements correctly describes foreign direct investment (FDI)? a. FDI requires countries to pay back sizable amounts of interest. b. FDI flows equally within the developing world. c. Because developing countries cannot borrow money to build new infrastructure, they must rely upon foreign investment. d. Most FDI goes to developing countries that need it more than the countries that are already developed. e. FDI has grown rapidly in the twenty-first century.

e. FDI has grown rapidly in the twenty-first century.

Use Figure 10-1 to answer the question. Productivity is the value of a particular product compared to the amount of labor needed to make it. One measure of productivity is the GDP per person employed. Which of the following would also be TRUE of a country with a GDP per person employed below $25,000? a. a high percentage of people employed in banking and government b. a low percentage of people employed in mining c. a high percentage of people supported by government subsidies d. a low percentage of people employed in forestry e. a high percentage of people employed in agriculture

e. a high percentage of people employed in agriculture

On average, producers receive only 1 percent of the price of the good. In contrast, fair trade returns which portion of the price? a. one-quarter b. one-tenth c. two-thirds d. three-quarters e. one-third

e. one-third

Which factors best account for the United States having a GII rank much lower than its HDI rank? a. labor force participation and percentage of women in the national legislature b. life expectancy at birth and literacy rate c. maternal mortality rate and labor force participation rate d. secondary education rates and pupil/teacher ratio e. percentage of women in the national legislature and adolescent fertility rate

e. percentage of women in the national legislature and adolescent fertility rate *Remember: GII's 3 dimensions are reproductive health, empowerment, and the labor market

In the twenty-first century, the United States has witnessed a. the transfer of wealth by the top one percent to Asia. b. higher tax rates on the wealthiest Americans to ensure equality. c. the wealthiest one percent of the population control less of the wealth since the 1980s. d. little change in how much wealth the wealthiest control. e. the wealthiest one percent of the population control more of the wealth since the 1980s.

e. the wealthiest one percent of the population control more of the wealth since the 1980s.