What is one reason the text provides for why open economies tend to grow faster than closed economies?
Explanation
This question checks whether the student can identify that while the text presents a strong correlation between economic openness and growth, it does not detail the underlying reasons in the specific policy recommendation section.
Other questions
According to United Nations data, what percentage of the world's income does the richest 20 percent of the world's population receive?
What is the World Bank's classification for high-income nations such as the United States, Japan, and Canada?
What was the average per capita income for the low-income nations in 2006?
If a developing country with a per capita income of $400 a year and an industrially advanced country with a per capita income of $20,000 per year both experience a 2 percent growth rate, what will be the new absolute income gap between them?
Which of these is NOT listed as a key obstacle to economic development in developing countries?
What is the term for the phenomenon where highly educated and skilled workers emigrate from developing countries to industrially advanced countries?
The demographic transition view of population growth suggests that:
What is the term for the transfer of private savings from developing countries (DVCs) to accounts held in industrially advanced countries (IACs) to avoid risks like expropriation or high inflation?
Which of the following is NOT an obstacle to investment in DVCs?
The 'vicious circle of poverty' suggests that poor nations stay poor because:
What is the term for the institutional problem in many DVCs related to the distribution of land ownership, which can involve either excessive concentration or farms that are too small for modern technology?
Which of the following is NOT considered a positive role for government in fostering economic development in DVCs?
What is a major criticism of providing foreign aid directly to the governments of DVCs?
What was the total amount of foreign aid from IACs to developing nations in 2006?
According to the text, what has been the recent trend in the composition of private capital flows to DVCs?
Which of these is NOT a DVC policy suggested by economists for promoting growth?
What is a primary reason the text gives for why IACs should reduce farm subsidies to help DVCs?
In the LAST WORD section on Famine in Africa, which of the following is identified as a major man-made cause of famines?
What is the term for the situation where a large number of people are employed fewer hours per week than they desire or work at jobs unrelated to their training?
According to the text, what is a primary reason that the United States has a comparative advantage in producing capital-intensive goods?
What is the term for a country's stock of public capital goods, such as roads, bridges, and communications systems?
Which of the following is a key reason that technological advance is often difficult to transfer to the poorest DVCs?
What is the 'will to develop' described in the chapter?
If a DVC with a stable population manages to increase its saving and investment, leading to a real GDP growth of 2.5 percent per year, how long will it take for its standard of living to double?
According to the text, which of these is NOT a method by which IACs can aid developing nations?
In 2006, what was the combined GDP of DVCs compared to the U.S. GDP?
Which institution, supported by about 185 member nations, has the major objective of helping DVCs achieve economic growth through loans and technical assistance?
How does the text describe 'in-kind' investment as a way for a poor DVC to accumulate capital?
According to the 'LAST WORD' section, what is one way that population growth contributes to ecological degradation in Africa?
What is the primary function of the International Development Association (IDA), an affiliate of the World Bank?
Which of these is NOT a characteristic of low-income nations as described in the chapter?
What percentage of the world's population lives in low-income DVCs?
Why might rapid population growth lead to a decrease in productivity in a DVC?
What is the primary reason that saving rates in some DVCs like India and China are higher than in IACs like the United States?
A fatalistic view that 'providence' rather than hard work determines one's lot in life is an example of what kind of obstacle to development?
According to the text, what is a major negative consequence of forcing an economy to save through inflation?
What is the primary benefit of direct foreign investment in DVCs, according to the chapter?
Why might a DVC with abundant natural resources still struggle with economic development?
What is the primary purpose of the World Bank's 'last-resort' lending agency role?
What is the estimated percentage of foreign aid that is diverted to government officials due to corruption in some DVCs?
How much debt did the G8 nations cancel for developing countries in 2005?
Which of these is NOT a human resource problem commonly found in the poorest DVCs?
What is a major reason adults in peasant agriculture DVCs may view having many children as a form of informal social security?
What does the text identify as a major reason for the increased flow of private capital to DVCs in recent years?
Privatizing state industries is suggested as a DVC policy for promoting growth because:
According to the World Bank, what was the average per capita income of middle-income nations in 2006?
What is a primary problem with DVCs relying on exports of farm products and raw materials?
In the text's discussion of human resources, what is identified as a consequence of rapid rural-urban migration in DVCs?
Which of the following countries is NOT listed as a middle-income nation?