1.Which of the following is a direct implication of the view that childbearing is an economic decision?*

People will not have additional children unless they can earn a profit from doing so.

Social factors have no effect on childbearing decisions.

Compulsory education will increase fertility by raising each child's prospective earnings.

Fertility should fall with improved opportunities for women to work in jobs outside the home.

2.Which of the following is not true about human capitals' role in economic development?*

Provides labor for industry sector

Provides a market for non-agricultural commodities

Source of industrial human resource

None of the above

3.Which of the following does not correlates to global poverty?*

population growth

technology

gender inequality

a low defense budget

4.Economic Arguments for Child labor include:*

Household poverty can be relieved by child labor

Philippines used child labor to develop

No schooling is available

Children can mix work and education in a progressive setting

All of the above

5.What is one of the reasons why economic development has failed to stabilize population growth in LDCs?*

Exploding population has negated any positive effect of economic development.

Population decline due to reduced birth rate is negated by the large numbers of immigrants.

Additional resources allow families to support several children.

Economic supply has increased quality of life but not population control.

6.If Lorenz curves cross, we say there is less inequality in the case where*

the poorer get a larger percentage of income

the poorer get a smaller percentage of income

the richer are less rich

we cannot say

7.Whereas the headcount measure tells us the number of poor and the poverty gap measure tells us about the average depth of poverty among the poor, the Foster-Greer-Thorbecke measure tells us about the number, the average depth of poverty and*

average income

inequality in the population

inequality among the poor

variance of average income

8.Malthus argued that the poor would always remain poor because*

population growth tends to outrun growth of food production

they do not save enough

there are not enough resources to educate them

all of the above

9.Children have costs and benefits to parents, and - (refer to the demand for children equation)*

the impact on family income is always negative, so children can be viewed as consumer goods.

there is a trade-off to parents between quantity and quality of children

the income elasticity of demand for children is strongly negative.

none of the above

10.The Malthusian theory of population growth, as formulated by Malthus, proved*

entirely correct for human behavior

overly pessimistic about future productivity increases

that food output will decline with population growth

none of the above

11.The Lorenz curve*

allows us to rank all countries by the degree of inequality.

allows us to rank all countries by the degree of poverty.

is a measure of the wealth of a country.

is an incomplete measure of inequality.

12.The Gini coefficient provides a measure of:*

the level of poverty

the level of relative inequality

disguised unemployment

the rate of growth

13.All are negative consequences of population growth except:*

Poverty and inequality

Low level of education

Poor health care system

None of the above

14.The Gini Coefficient is calculated by finding which of the following?*

The percentage of the population living on less than $1 a day

The area between a Lorenz curve and the line of absolute equality

The difference between the richest and poorest of the population

The proportion of the population with more than a primary education

The percentage of the population living on more than $1 a day

15.When Lorenz curves*

are more curved the greater is the degree of income inequality.

are less curved the greater is the degree of income inequality.

are used in calculating Gini coefficients.

First and third choice are correct

16.The closer the Lorenz Curve to the line of absolute equality,*

the lower is the degree of income inequality

the higher is the degree of income equality

the higher is the degree of income inequality

the lower is the degree of income equality

17.Which of the following describes why income inequality is bad for economic development?*

Income inequality may threaten political stability, because people are dissatisfied with their economic situation and place blame on political authorities.

Income inequality reduces the pool of people with resources, such as education, to improve productivity.

Income inequality may increase distrust and deter commitment among people in the marketplace, making contracts enforcement difficult.

First and second choice only

18.In general, countries that have higher average number of years of education per person have*

higher education Gini coefficients.

less equal distributions of education.

lower education Gini coefficients.

First and second choice only

none of the above

19.Closing the educational gender gap is widely considered to be economically desirable because*

the rate of return on women's education is higher than that on men's in most LDCs.

increasing women's education increases their productivity.

it would help lessen poverty, since women are less likely to be impoverished than are men.

First and second choice only

20.Comparing the costs and benefits, both private and social, of education leads economists to the conclusion that*

the socially optimal strategy would be to focus on secondary education.

the socially optimal strategy would be to focus on primary education.

the privately optimal strategy would be to focus on private education.

the privately optimal strategy would be to focus on secondary education.

None of the above

21.Which of the following statements is incorrect?*

Improvement in female education and labor force participation helps break the vicious circle of poverty.

Female education helps reduce the fertility rate and child mortality rate.

The rate of return on female education is higher than the rate of return on male education.

Female education helps reduce participation of women in labor market activities.

22.The supply of public school places is determined by*

individuals' demand for education.

direct and indirect costs of schooling.

political processes, often unrelated to economic criteria.

all of the above

23.Developing countries have not benefited as much as expected from their higher education programs because of*

lack of program focus on the needs of the country.

increasing returns to scale in each individual's education.

graduates get jobs in the private sector.

all of the above.

24.It is important to place particular stress on the role of primary education in the development strategy because of*

LDC's comparative advantage from basic skills education.

the law of diminishing returns.

development emphasis on poverty alleviation.

all of the above.

25.An individual's demand for education is most affected by*

direct and indirect costs of schooling.

development priorities of the country.

the desire to escape agricultural work.

all of the above.

26.A. The rate of population growth has a major impact on the nation's economy. B. Practically all income in underdeveloped nations is used to purchase consumer goods, which leaves little, if anything, for savings.*

First statement is TRUE, second is FALSE

First statement is FALSE, second is TRUE

Both statements are TRUE

Both statements are FALSE

27.A. Investments in human capital improve productivity and standards of living. B. Women in LDCs typically have literacy rates below those of men.*

First statement is TRUE, second is FALSE

First statement is FALSE, second is TRUE

Both statements are TRUE

Both statements are FALSE

28.A. There is a strong positive correlation between economic growth and poverty. B. Population growth is higher in high income countries rather than in low income countries.*

First statement is TRUE, second is FALSE

First statement is FALSE, second is TRUE

Both statements are TRUE

Both statements are FALSE

29.A. For any two countries, the one with the bigger per capita GDP will have a more equitable distribution of income. B. As of the present, population growth is a desirable phenomenon.*

First statement is TRUE, second is FALSE

First statement is FALSE, second is TRUE

Both statements are TRUE

Both statements are FALSE

30.A. Increases in income often do not lead to substantial increases in investment in children's education and health. B. A social factor of population where women receive education that positively influences fertility rates is women empowerment.*

First statement is TRUE, second is FALSE

First statement is FALSE, second is TRUE

Both statements are TRUE

Both statements are FALSE

31.A. Public programs are designed to help parents plan and regulate their family size in accordance with their ability to support a family. B. In developing countries, the opportunity cost of an education is relatively low compared to the cost in a highly developed country*

First statement is TRUE, second is FALSE

First statement is FALSE, second is TRUE

Both statements are TRUE

Both statements are FALSE

32.. Higher the education of women, the higher the income, therefore they have a higher taste for having children. B. The greater the curvature of the Lorenz line, the greater the relative degree of inequality.*

First statement is TRUE, second is FALSE

First statement is FALSE, second is TRUE

Both statements are TRUE

Both statements are FALSE

33.A. The higher the level of per capita income is, the lower the numbers of the absolutely poor. B. Initial investments in health or education lead to a stream of higher future income.*

First statement is TRUE, second is FALSE

First statement is FALSE, second is TRUE

Both statements are TRUE

Both statements are FALSE

34.. In general, people with more human capital have higher wages, so more schooling and more work experience generally lead to higher wages. B. The smaller the Gini ratio, the more equal the income distribution.*

First statement is TRUE, second is FALSE

First statement is FALSE, second is TRUE

Both statements are TRUE

Both statements are FALSE

35.A. In "Income and Wealth Inequality," The government has responded to the rise in income inequality by increasing taxes on the rich and increasing transfers to the poor. B. Trade seems to reinforce existing income inequalities.*

First statement is TRUE, second is FALSE

First statement is FALSE, second is TRUE

Both statements are TRUE

Both statements are FALSE

36.A. Gini coefficient is a measure of market efficiency. B. If Income is distributed evenly, the Gini coefficient is equal to one.*

First statement is TRUE, second is FALSE

First statement is FALSE, second is TRUE

Both statements are TRUE

Both statements are FALSE

37. Studies show that improved education of women in developing countries lead to lower infant mortality. B. Child labor is a widespread problem that applies primarily to children between the ages of 5 and 14.*

First statement is TRUE, second is FALSE

First statement is FALSE, second is TRUE

Both statements are TRUE

Both statements are FALSE

38.A. Concentration of resources on higher rather than basic education in developing countries tends to lead to greater inequality. B. Evidence suggests that population growth also has a positive effect on economic growth.*

First statement is TRUE, second is FALSE

First statement is FALSE, second is TRUE

Both statements are TRUE

Both statements are FALSE

39.A. In recent years, the fertility rate in developing countries has been declining. B. Projections place world population by 2050 at between 4 and 6 billion.*2 points

First statement is TRUE, second is FALSE

First statement is FALSE, second is TRUE

Both statements are TRUE

Both statements are FALSE

40.A. The Malthusian population trap assumes that fertility increase with per capita income. B. Fertility should fall with improved opportunities for women to work in jobs outside the home.*

First statement is TRUE, second is FALSE

First statement is FALSE, second is TRUE

Both statements are TRUE

Both statements are FALSE