Spring 2020

Course: Economic development -EI421

Lecturer: Dr. Shereen Ahmed

Sheet 3

MCQs:

1- The best-known system of several international agencies, that offer classifications of countries by their
economic status is
a. OECD
b. UN
c. WB

2- The world bank classification system ranked the countries’ economic status by

a. GNI
b. GNI per capita
c. Per capita income

3- The World Bank classifications are .

a. LICs
b. LMCs
c. UMCs
d. HICs
e. All of the above

4- The definition of countries at a relatively advanced level of economic development with a sustainable and
dynamic industrial sector and with a close links to the international trade, finance, and investments system; is
for:
a. LICs
b. LMCs
c. NICs

5- The World Bank has classified countries according to their degree of international indebtedness as:
a- Severely indebted
b- Moderately indebted
c- Less indebted
d- All of the above
 6- UNDP classified countries low, medium, high, very-high according to their
a. International indebtedness
b. GNI
c. HDI
7- Basic indicators of development include
a. Real income per capita
b. health
c. educational attainments
d. all of the above
8- Methods of measuring the real income per capita are:
a. GNI
b. GDP
c. PPI
d. All of the above

9- The total domestic and foreign output claimed by residents of a country, consisting of GDP plus factor income
earned by residents abroad, minus income earned in the domestic economy by nonresidents is called:
a. GNI
b. GDP
c. PPI

10- The total final output of goods and services produced by the country’s economy within the country’s
territory by residents and nonresidents, regardless of its allocation between domestic and foreign claims.
.
a. GDP
b. GNP per capita
c. HDI

11- Calculation of GNI using a common set of international prices for all goods and services, to provide more accurate
comparison of living standards.
a. GDP
b. GNI
c. PPP

12- The number of units of foreign country’s currency required to purchase the identical quantity of goods and services
in the local developing country market as $1 would buy in the United States, is called:
a. PPI
b. PPP
c. IPP
13- Income Gaps between developed and developing nations tend to be when PPP is used.
a. more
b. less
c. same

14- Methods to measure Health as one of the indicators of development

a. Life expectancy
b. undernourishment
c. birth rate
d. All of the above
 15- is the average number of years newborn children would live if subjected to the mortality risks
prevailing for their cohort at the time of their birth.
a. Birth rate
b. Undernourishment
c. Life expectancy

16- means consuming too little food to maintain normal levels of activity; it is what is often called
the problem of hunger.
a. Birth rate
b. Undernourishment
c. Life expectancy

17- The fraction of adult males and females reported or estimated to have basic abilities to read and write.
a. literacy
b. Sustenance
c. Freedom

18- the most widely used measure of the comparative status of socioeconomic development is presented by the UNDP.
a. HID
b. PPP
c. HDI

19- An index measuring national socioeconomic development, based on combining measures of education,
health, and adjusted real income per capita.
a. HDI
b. PPP
c. HID

20- HDI combines 3 indicators:

a. Life expectancy
b. Educational attainment
c. GDP Per capita measured in PPP terms
d. All of the above

21- The HDI rank countries into four groups:

*N.B: specify the values of each
a. Low human development
b. Medium human development
c. High human development
d. Very high human development
e. All of the above

22. A newly industrialized country is

a. the same as a high-income country.
b. any country that has experienced sustained growth in industry.
c. a special classification given to some upper-middle income countries that have
achieved relatively advanced manufacturing sectors.
d. any country that has moved out of lower income status.
23- Which measure uses a common set of international prices for all goods and services produced?
a. purchasing power parity income levels
b. GNI price deflators
c. foreign exchange rate conversions to U.S. dollars
d. the exchange rate
24- Which of the following is not an indicator that is used by the World Bank in measuring the level
of economic development?
a. life expectancy at birth.
b. adult literacy rate.
c. infant mortality rate.
d. all of the above are not used by the World Bank.

Short Essay Questions:

1- Why it’s better to use the PPP rather than the exchange rates as conversion factors while comparing
between developed and less developed countries?
2- Write down the equation of HDI.
3- Compare between the advantage and disadvantage of HDI.
4- Explain why purchasing power parity measures of income levels tend to show a smaller difference
between poor and rich countries.