TRUE OR FALSE

1. Malthusian idea of a population inexorably forced to live at income of $2.0 per day or slightly more is termed Malthusian trap since population do not increase anymore at this point.

2. The poor (those within and below poverty line) are a majority in all countries.

3. The economic foundation of a country and a person determines all other aspect of society and a person's life, respectively.

4. To be economical developed means a country must have lots of resources.

5. The ideal graph of population in terms of age groups would be rectangular in perspective.

6. Development in economics does not consider fiscal (taxation) schemes.

7. Sen's capability approach talks about a person's functionality.

MULTIPLE CHOICE

1. Extreme income inequality leads to economic inefficiency. Why?

a. The higher the income inequality is, the smaller the population growth that would secure the future of the ageing population.

b. The higher the income inequality is, there are few buyers that would be able to afford the commodities, hence lower GDP, income and economic efficiency.

c. The higher the income inequality is, the bigger is the chance for labor discontent and hence laborers become inefficient in their work.

d. The higher the income inequality is, the smaller the fraction of the population that qualifies for a loan or other credit.

e. All

2. To be economical developed means a country must have lots of resources.

A. True

B. False

3. What does health, income and education have in common that deters development?

a. unequal distribution

b. basic quality of life determinant

c can all be provided by the government

d. all is the responsibility of the individual concerned.

4. Social costs of higher education is higher when private cost goes down.

A. True

B. False

5. Population should be proportional to the

a. income of the nation

b. arable area of the country

c. number of relatives

d. number of members in the family

6. In comparative development we discussed, the development of nations starts with physical geography, then to pre-colonial institutions and labor, inequality, human capital, well-functioning markets and ultimately to natural resources and business development.

A. True

B. False

7. Specialization is a product of:

a. performing things you want to do.

b. applying methods in making products.

c. market data.

d. trade.

8. Specialization refers to:

a. Experiencing the best in consuming a good or service.

d. Having competent economic concepts.

c. Focusing on one's profession.

b. Good task undertaking

9. It is argued that population is deterrent to development, since

a. There is a positive relationship between poverty and family size.

b. There would be higher wage rate as population rises.

c. population growth in general subsequently falls as countries grow and develop

d. there are more birth control technologies as a country develops.

e. A & B

f. A & C

g. All

h. None

10. Women play important roles in economic development, which of the following is not one of them?

a. Have primary responsibility for child rearing

b. Have the better mindset in using resources of the nation to reduce poverty.

c. Determines next generation values and morals.

d. Determination of transmission of poverty from generation to generation will be broken.

11. In measuring inequality and assessing growth, putting more weight on the gains of the income gains by those who have lower incomes is a manifestation of this kind of approach.

a. Income distribution

b. The Ahluwalia-Chenery Welfare Index

c. functional distribution

d. Gini coefficient approach

e. Sen's capability approach

12. If development entails the improvement in people's levels of living (their incomes, health, education, and general well-being), then

a. it also encompasses their capabilities, self-esteem, respect, dignity, and freedom to choose.

b. it will also attain the three cores of development - Sustenance (ability to meet basic needs)

c. will achieve elf-esteem (to be a person) and freedom, which are more important than income.

d. society and the person will live in harmony with nature, the environment and the law altogether.

e. Marx's economic foundation theory will be realized.

f. A and B.

g. C and D.

h. All

g. None

13. Poverty is not being able to meet what a person needs and wants. Absolute poverty, on the other hand is not being able to meet at least his/her basic needs. Measuring it by depending it on the level and distribution of resources among the poor is a manifestation of

a. Income poverty

b. Multidimensional Poverty Measurement

c. The Foster-Greer-Thorbecke Index

d. World Bank and ADB Poverty Threshold

e. The Ahluwalia-Chenery Welfare Index

14. Another reason to be concerned with extreme income inequality is that these disparities undermine social stability and solidarity. To be specific, its stability and solidarity consequences are:

a. Once GDP increases, it accrues to the stockholders, direct investors and finance guarantors.

b. Capital access and credit line for the rich and middle income groups without any collateral or guarantee.

c. High inequality strengthens the political power of the rich and hence their economic bargaining power.

d. Facilitates excessive lobbying (rent seeking), large political donations, bribery, and cronyism.

e. A and B

f. C and D

g. All

15. A pyramid type of population graphical presentation by age group, which is very prominent in developing countries indicates that:

a. Less dependents are in the working class

b. More productive labor groups today but not tomorrow

c. Young and old people dominates the population

d. Dependents mostly come from the younger generation

e. The economy is booming and so does population

16. Which of the following statements is true?

a. Economic welfare is having highest GNP.

b. Although all of us have self-interest, trade makes us all better off.

c. Economics is a social science that undertakes to make better world by providing profits to all.

d. Development economics deals with GDP, setting aside GNP.

17. One of the three cores of development is freedom, which simply means that people are able to choose what commodity people want to consume and what business/es want to engage in. This is important because:

a) people can't afford every commodity/service they want

b) there's a lot of available competing commodities/services in a competitive market.

c) waste will be generated if commodities will be produced without consumers

d) freedom to choose commodities people want would reveal what consumers would really want

e) those commodities/services chosen by consumers would be a signal to businesses on what to invest in, further preventing resource wastage

f) A & B

g) C & D

h) D & E

i) All

18. Investment expenditures are important in economic growth because it means there are more capital goods for workers to use to produce more consumer goods therefore increasing the level of output in the economy.

A. True

B. False

19. Which of these reduces life expectancy/quality of life significantly?

a. nutrition

b. water problems

c. income

d. neglect of tropical diseases

e. A & B

f. C & D

g. All

h. None

20. Height is directly proportional to income potential.

A. True

B. False