1) Latifundios are

a. large farms that provide employment for more than 12 workers.

b. farms too small to provide employment for even one family.

c. medium-sized farms employing 10 or fewer workers.

d. flat, relatively arid agricultural lands in the southern part of South America.

e. None of the above

2) Most of today's development economists believe that

a. peasant farmers who refuse to adopt new ideas or technologies are behaving irrationally.

b. agriculture is important, but a heavy emphasis on rapid industrialization is key.

c. agriculture should play a passive and supportive role in economic development.

d. agriculture must be a key component in any development strategy.

e. None of the above

3) Even in the poorest countries of the developing world, farmers make rational economic decisions because they

a. grow food for self-consumption

b. have large family labor force

c. receive assistance from local cooperatives

d. respond to market prices and incentives

4) Productivity in Third World agriculture is low because of*

a. insufficient capital investment

b. lack of complementary resources

c. rapid growth of the labor force

d. inadequate pricing policies

e. All of the above

f. None of the above

5) Subsistence family farmers in LDCs behave as "risk averters" because of

a. inadequate production technology

b. high opportunity cost of crop failure

c. high inequality in land distribution

d. low labor productivity

6) The pattern of land distribution, ownership and management and also the social and institutional structure of the agrarian economy.

a. Land Reform

b. Sharecropper

c. Agrarian System

d. Family Farm

7) The final and most advanced stage of evolution of agricultural production in which farm output is produced wholly for the market.

a. Commercialized Farming

b. Medium-Size Farm

c. Scale-Neutral

d. Subsistence Farming

8) Figure 1 : Risk-Taking in Subsistence Farming*

Technique A: low mean, low variance (Mean = 10)

Technique B: high mean, high variance (Mean = 12)

9) Refer to Figure 1 : What happens if a farmer chose Technique A?*

a. Possibility of a higher risk and higher yield

b. Possibility of a lower yield and lower risk

c. Possibility of higher yield and lower risk

d. Possibility of lower yield with higher risk but sustainable

e. No answer

10) Refer to Figure 1: What happens if a farmer chose Technique B?

a. Possibility of a higher risk and higher yield

b. Possibility of a lower yield and lower risk

c. Possibility of higher yield and lower risk

d. Possibility of lower yield with higher risk but sustainable

e. No answer

11) In what way do developing countries make the largest contribution to the global concentrations of greenhouse gases?*

a. Vehicle Emissions

b. Mining

c. Deforestation

d. Irrigation

12) Which of the following would best describe Sustainable Development?*

a. Emphasizing the role of the world market and resources

b. Emphasizing the role of government

c. Meeting the present generation's needs without compromising the needs of the future generations

d. Maintaining output growth at a constant rate

13) A major cause of environmental degradation in developing countries*

a. population growth

b. rapid urbanization

c. rural poverty

d. all of the above

e. none of the above

14) The Philippine government would most likely adopt a contractionary fiscal policy during periods when:*

a. firms are producing beyond their normal capacity.

b. the ratio of consumer debt with respect to personal income is decreasing.

c. business inventories on hand are increasing.

d. the cost of labor input per unit of output in manufacturing is decreasing.

15) By using fiscal policy, i.e. varying ________ and/or ___________, governments achieve goals for output and employment growth as well as price stability.*

a. inflation, tax elasticity.

b. interest rates, financial liberalization

c. interest rates, tax rates.

d. tax rates, government spending.

16) What would be the possible effect of an expansionary monetary policy?*

a. increase in money supply and decrease in interest rates

b. increase in bank revenues through increase in investments

c. increase in interest rates and increase in money supply

d. decrease in money supply and decrease interest rates

17) The combined effect of an expansionary monetary policy and contractionary fiscal policy would be

a. an increase in interest rate and increase in tax rates

b. a decrease in interest rate and decrease in tax rates

c. an increase in tax rates and decrease in interest rates

d. an increase government spending and decrease in money supply

18) Development economics is concerned with

a. efficient allocation of scarce resources.

b. economic, social and political institutions.

c. imperfect resource and commodity markets.

d. First and second choice only

e. None of the above

19) Developing countries are commonly characterized by

a. low levels of living, high levels of income inequality, and high dependency burdens.

b. primary-product exports, inadequate education and vulnerability in international relations.

c. all of the above

d. none of the above

20) Development economics must have a scope wider than traditional economics because

a. values and attitudes play little role in the pace of development.

b. people in developing societies do less utility-maximizing.

c. transformation of social institutions is necessary for development.

d. all of the above

CHOICES FOR THE ITEMS BELOW

a. First statement is TRUE, second is FALSE

b. First statement is FALSE, second is TRUE

c. Both statements are TRUE

d. Both statements are FALSE

1) A. Inclusion of women in the design of environmental policy is important.

B. Environmental issues affect, and are affected by, economic development.

2) A. Environmental problems have consequences both for health and productivity.

B. Economists are not concerned with the costs of global climate change.

3) A. Poverty and ignorance may lead to non-sustainable use of environmental resources. B. Environmental problems result to future economic losses.

4) A. Agriculture seems to reinforce existing income inequalities.

B. Agriculture can only make a good economic activity for LDC's.

5) A. Agriculture can possibly break the economy of a country.

B. MDCs have higher total productivity than LDCs.

6) A. Agriculture employs a large percentage of the labor force.

B. Agriculture generates a large percentage of the GDP.

7) A. The primary sources of risk to farmers are price and weather.

B. Economic growth increases rapidly if a large sector such as agriculture is left to delay behind the rest of the economy.*

8) A. Technological changes in agriculture encourage urban migration.

B. All goods and services a country produce are from the Agricultural sector.*

9) A. Expansionary fiscal policy encourages the increase in tax rates.

B. Economic growth means economic development.