Question 1

The World Bank and the International Monetary Fund were established after World War II as part of a major reform of the international monetary system.

Accepted Answer

The World Bank and International Monetary Fund were established through the Bretton Woods Agreement of 1944, which was a major reform of the international monetary system following World War II.

Question 2

The World Bank and the International Monetary Fund were created during the Industrial Revolution of the eighteen century.The birth of these two institutions marks the beginning of the capitalist global system as we know it.

Accepted Answer

The World Bank and the International Monetary Fund were actually created after World War II, not during the Industrial Revolution of the 18th century. Therefore, they do not mark the beginning of the capitalist global system.

Question 3

Which of the following is one of the drivers for the Emerging Africa?

Accepted Answer

The spread of internet technology and cellphones has played a significant role in driving the Emerging Africa. It has opened up opportunities for e-commerce, e-banking, and access to information, which has contributed to economic growth in the region.

Question 4

Does the saving rate in developed countries have any effect on the time it takes for developing countries to catch up with the developed part of the world? Explain.

Accepted Answer

The answer of Does the saving rate in developed countries...

Question 5

What are some of the benefits of allowing and encouraging foreign investment in a country?

Accepted Answer

The answer of What are some of the benefits of...

Question 6

Which of the following is the best example of portfolio investment?

Accepted Answer

Portfolio investment refers to the purchase of securities or other financial assets with the expectation of earning a return on investment. Option A where a U.S. company acquires less than 10 percent ownership of a foreign company is the best example of portfolio investment as it involves investment in securities without acquiring control of the foreign company. Option B involves foreign direct investment as the U.S. company acquires more than 10 percent ownership of a foreign company and exercises control. Option C and D are examples of foreign lending and not portfolio investment. Option E is an example of international banking and not portfolio investment.

Question 7

Which of the following is true about the World Bank and the International Monetary Fund (IMF)?

Accepted Answer

The World Bank and the IMF were indeed created after World War II as part of a major reform of the international monetary system, and they both make loans to developing countries. Additionally, they serve as intermediaries, channeling funds from industrialized countries to developing ones.

Question 8

A country with a population growth of 5 percent and capital growth of 10 percent is better off than a country with population growth of 2 percent and capital growth of 2 percent.Please answer true or false and explain.

Accepted Answer

The country with the higher rate of population growth has a capital labor ratio that is growing more quickly because the rate of capital growth is so much higher than the other country.The other country has a constant capital labor ratio.

Question 9

Which of the following increases the likelihood of poor countries catching up to rich countries,and which decreases the likelihood? Explain.
(A)Developing countries have better access to the technology of developed countries.
(B)Industrialized countries run larger government budget surpluses.
(C)The level of corruption in developing countries increases.
(D)Developing countries become more reluctant to provide schooling for all their citizens.
(E)Developing countries begin to emphasize export-led strategies.

Accepted Answer

The answer of Which of the following increases the likelihood...

Question 10

The aging population in Africa implies that the Emerging Africa phenomenon will disappear soon.

Accepted Answer

The aging population in Africa does not necessarily imply that the Emerging Africa phenomenon will disappear soon. While an older population may present challenges to economic growth and development, there are many factors that contribute to the Emerging Africa phenomenon, such as natural resources, improved governance, infrastructure development, and a growing middle class. Additionally, while some African countries may see an increase in the proportion of their older population in the coming years, others may not, and demographic trends are often complex and varied.

Question 11

Why has there been a convergence in real income per capita for Western European countries,but not for African countries?

Accepted Answer

The answer of Why has there been a convergence in...

Question 12

After World War II,in order to reform the international monetary system,the

Accepted Answer

The establishment of the World Bank and the International Monetary Fund (IMF) was a key part of the post-WWII effort to reform the international monetary system. The World Bank was created to provide financing for post-war reconstruction and development, while the IMF was tasked with maintaining currency stability and facilitating international trade.

Question 13

A major institution of the international monetary system is the IMF.What does IMF stand for?

Accepted Answer

IMF stands for International Monetary Fund.

Question 14

Poor countries are in principle aided by larger current account surpluses in the developed countries.

Accepted Answer

The answer of Poor countries are in principle aided by...

Question 15

The IMF is a financial intermediary.

Accepted Answer

The International Monetary Fund (IMF) functions as a financial intermediary between its member countries, providing loans and facilitating monetary cooperation and exchange rate stability.

Question 16

Exhibit 28-1 
-Plot on a scatter diagram the data from the African countries listed in Exhibit 28-1.Does there appear to be a catch-up line in the scatter diagram?

Accepted Answer

The answer of Exhibit 28-1 
-Plot on a scatter diagram...

Question 17

Conditionality refers to

Accepted Answer

Conditionality refers to the concept that the IMF will lend money on the condition that the country undertakes economic reform. This can include measures such as reducing government spending, implementing structural reforms, and opening up markets to foreign competition. The idea behind conditionality is that the IMF wants to ensure that the country will be able to repay the loan in the future and avoid a larger crisis.

Question 18

Why is it not a good idea for a developing country to avoid having a trade deficit?

Accepted Answer

The answer of Why is it not a good idea...

Question 19

The World Bank makes loans to governments and for general purposes,never for specific projects.

Accepted Answer

The World Bank makes loans for both general purposes and specific projects, such as infrastructure development or poverty reduction programs.

Question 20

All else the same,a country with population growth of 5 percent will grow more slowly than a country with population growth of 2 percent.Please answer true or false and explain.

Accepted Answer

The country with higher population growth will have a capital labor ratio that is growing more slowly.

Quiz 28: Economic Growth and Globalization