What is the rationale for the IMF and World Bank to provide loans to developing countries?
A) They will receive higher interest rates in return because of the higher risk.
B) They will enable new infrastructure that will lead more domestic and foreign businesses to open and expand.
C) for purely humanitarian reasons
D) They are chartered to loan to high risk countries, knowing that many of the financed projects will fail.
E) The huge growth potential will insure high returns.

Question

Quizplus · Accepted Answer

The rationale for the IMF and World Bank to provide loans to developing countries is to enable new infrastructure that will lead more domestic and foreign businesses to open and expand. This ultimately helps to stimulate economic growth, create jobs, and improve living standards in these countries. While they may receive interest on their loans, the primary goal is to promote economic development and reduce poverty. The IMF and World Bank also work with recipient countries to ensure that the loans are used effectively and that the projects they finance are sustainable in the long term.

What Is the Rationale for the IMF and World Bank