Chapter (1&2) Questions

Chapter (1) MCQs

1. Poverty is
a. Lack of income
b. Multidimensional
c. out of control
d. All of the above
2. ……………. A situation of being unable to meet the minimum levels of essentials
a. Absolute poverty
b. Relative poverty
c. Temporary poverty
d. None of the above
3. The basic necessities of life include
a. Food
b. Shelter
c. Clothing
d. All of the above are basics
4. ……………… is an economy in which production is mainly for personal consumption
a. Developed economy
b. Developing economy
c. Subsistence economy
d. None of the above
5. Economic development tries to
a. Improve per capita income
b. Improve the quality of all humane lives and capabilities
c. Improve education systems
d. None of the above
6. Economic development tries to improve the quality of all humane lives and capabilities by
raising peoples
a. Levels of living
b. Self-esteem
c. Freedom
d. All of the above
7. Countries of Asia, Africa, The Middle East, Latin America, and Eastern Europe that are
presently characterized by
a. Low levels of living but development potential.
b. High levels of living and continuous development.
c. Low levels of living and other development deficits.
d. None of the above is correct
8. Developing countries are Used in the development literature as synonym for
a. Less developed countries.
b. Industrialized countries
c. Third-world countries
d. None of the above is correct
9. Economic growth is
a. Increase the quality of all humane lives and capabilities
b. Increase the growth of per capita income.
c. Increase in multidimensional factors of life
d. All of the above can be correct

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10. One reason why development include more than just the growth of per capita income is
that
a. The growth is always diversified between vast areas and sectors of the economy.
b. Per capita income can show growth even when that growth does not touch vast
portions of the population.
c. Growth of per capita income is indefinitely linked to reduction of poverty and the
growth of self-esteem
d. None of the above is correct
11. The growth of per capita income alone is not sufficient to guarantee the reduction of
poverty and the growth of self-esteem because
a. People can use higher incomes in saving rather than consumption
b. Living standards are not linked to per capita income
c. The growth may be centered in one area or sector of the economy.
d. None of the above is correct
12. Economics that emphasizes utility, profit maximization, market efficiency, and
determination of equilibrium is
a. The traditional economics
b. Political economy
c. Development economics
d. All of the above
13. Economics that attempt to merge economic analysis with practical politics is
a. The traditional economics
b. Political economy
c. Development economics
d. All of the above
14. Economics that tries to bring rapid and large-scale improvement in the levels of living for
the people in poor countries is
a. The traditional economics
b. Political economy
c. Development economics
d. All of the above
15. Social system is
a. The organizational structure of a society
b. The institutional structure of a society
c. The organizational and institutional structure of a society
d. None of the above is correct
16. Social Systems depends on
a. Economic factors
b. Non-economic factors
c. Economic and non-economic factors.
d. None of the above is correct
17. Gross National Income is
a. The total domestic output claimed by citizens of country.
b. The total domestic and foreign output claimed by residents and non-residents of
country.
c. The total domestic and foreign output claimed by residents of country.
d. All of the above can be correct
18. ……….. Comprises GDP plus factor incomes accruing to residents from abroad, less the
income earned in the domestic economy accruing to persons abroad.
a. NNI
b. NDP
c. GNI
d. None of the above is correct

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19. Income per capita can be calculated by
a. Total GNI of country divided by labor force.
b. Total GNI of country divided by total population.
c. Total GDP of country divided by labor force
d. Total GDP of country divided by total population.
20. Development economics must have a scope wider than traditional economics because
a. Micro variable is not sufficient for sustaining development
b. Transformation of social institutions is necessary for development.
c. Development economics uses non-economic tools
d. All of the above is incorrect
21. Which of the following is NOT a topic of study in Development economics
a. Alleviation of absolute poverty.
b. Transformation of institutions.
c. Allocation of resources in developing countries.
d. All of the above are topics of study in Development economics
22. “Capability” Approach is introduced by
a. Roy Harrod and Evsey Domar
b. Walt Rostow
c. Arthur Lewis
d. None of the above
23. The core values of development include
a. The Ability to Meet Basic Needs
b. To Be a Person
c. To Be Able to Choose
d. All of the above are core values
24. Sustenance means
a. To Be a Person
b. To Be Able to Choose
c. The Ability to Meet Basic Needs
d. All of the above is correct
25. Self-Esteem means
a. To Be a Person
b. To Be Able to Choose
c. The Ability to Meet Basic Needs
d. All of the above is correct
26. Freedom from Servitude means
a. To Be a Person
b. To Be Able to Choose
c. The Ability to Meet Basic Needs
d. All of the above is correct
27. When a person has the basic goods and services that are necessary to sustain an average
humane being at the bare minimum level of living. We say that he has
a. Sustenance
b. Self-Esteem
c. Freedom from Servitude
d. None of the above is correct
28. The feeling of worthiness that a society enjoys when its economic systems and
institutions promote humane values is called
a. Sustenance
b. Self-Esteem
c. Freedom from Servitude
d. None of the above is correct

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29. A situation in which individuals enjoy real choices according to their preferences is called
a. Sustenance
b. Self-Esteem
c. Freedom from Servitude
d. None of the above is correct
30. Which of the following is not an important objective of development?
a. Increases in per capita income
b. The expansion of available choices
c. Increases in individual and national self-esteem
d. All of the above are important objectives of development
31. The Millennium Development Goals include
a. Eliminating the proportion of people living on less than $1 per day.
b. Universal primary education.
c. Increasing exports by one half.
d. All of the above.
32. The Millennium Development Goals do not include
a. Maternal health
b. Environmental sustainability
c. Balance of trade
d. All of the above

# Ans. # Ans. # Ans. # Ans. # Ans.

1 B 7 C 13 B 19 B 25 A
2 A 8 A 14 C 20 B 26 B
3 D 9 B 15 C 21 D 27 A
4 C 10 B 16 C 22 D 28 B
5 B 11 C 17 C 23 D 29 C
6 D 12 A 18 C 24 C 30 D
31 B
32 C

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 Chapter (2) MCQs
1. The most common way to define the developing world is by
a. Literacy rates
b. Mortality rates
c. per capita income
d. none of the above
2. World Bank Scheme- ranks countries on
a. GNI
b. GNI per capita
c. GNI per worker
d. None of the above
3. Countries with a gross national income per capita of less than $976 are classified as
a. Low- income countries
b. middle-income countries
c. high income countries
d. industrialized countries
4. Countries with a gross national income per capita between $976 and $11,906 are classified
as
a. Low- income countries
b. middle-income countries
c. high income countries
d. industrialized countries
5. …………………. Are Countries at a relatively advanced level of economic development with
a substantial and dynamic industrial sector
a. Low- income countries
b. middle-income countries
c. high income countries
d. Newly industrializing countries
6. Least developed countries are characterized by
a. low income
b. low human capital
c. high economic vulnerability.
d. All of the above
7. ……………… is the most common measure of the overall level of economic activity
a. GNI per capita
b. GDP per capita
c. NI per capita
d. None of the above
8. ..................... is the total domestic and foreign value added claimed by a country's residents
without making deductions for depreciation (or wearing out) of the domestic capital
stock.
a. GNI
b. GDP
c. NI
d. None of the above
9. ……………….. measures the total value for final use of output produced by an economy, by
both residents and nonresidents.
a. GNI
b. GDP
c. NI
d. None of the above

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10. Per capita GNI comparisons between developed and less developed countries are done
using ……………….. as conversion factors.
a. Official exchange rates
b. purchasing power parity
c. GDP deflator
d. None of the above
11. …………………….. is Calculation of GNI using a common set of international prices for all
goods and services
a. Official exchange rates
b. purchasing power parity
c. GDP deflator
d. None of the above
12. …………………. is the number of units of a 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.
a. Official exchange rates
b. purchasing power parity
c. GDP deflator
d. None of the above
13. “The under-5 mortality rate” is a basic indicator of
a. Income
b. Health
c. Education
d. None of the above
14. ……………. 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. Life expectancy
b. The rate of undernourishment
c. The under-5 mortality rate
d. None of the above
15. ……………. means consuming too little food to maintain normal levels of activity
a. Life expectancy
b. The rate of undernourishment
c. The under-5 mortality rate
d. None of the above
16. The rate of undernourishment is often called
a. the problem of poverty
b. the problem of hunger
c. the problem of literacy
d. none of the above
17. ……………….. is the fraction of adult males and females reported or estimated to have
basic abilities to read and write
a. Literacy
b. Malnourishment
c. Poverty
d. None of the above
18. functional literacy is generally ………….. the reported numbers
a. higher than
b. lower than
c. close to
d. none of the above

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19. The most widely used measure of the comparative status of socioeconomic development
is
a. Traditional HDI
b. New HDI
c. Modern HDI
d. None of the above
20. ………………… is An index measuring national socioeconomic development
a. Traditional HDI
b. New HDI
c. Modern HDI
d. None of the above
21. Human Development Index measures national socioeconomic development, based on
combining measures of
a. Health
b. Education
c. adjusted real income per capita.
d. All of the above
22. HDI based on goals of development like
a. Longevity
b. Knowledge
c. Standard of living
d. All of the above
23. Longevity measured by
a. life expectancy at birth
b. weighted average of adult literacy and gross school enrollment ratio
c. real per capita gross domestic product adjusted for the differing purchasing power
parity
d. all of the above
24. weighted average of adult literacy and gross school enrollment ratio measures
a. Longevity
b. Knowledge
c. Standard of living
d. All of the above
25. Standard of living measured by
a. life expectancy at birth
b. weighted average of adult literacy and gross school enrollment ratio
c. real per capita gross domestic product adjusted for the differing purchasing power
parity
d. all of the above
26. a country with HDI from 0.0 to 0.499 is ranked as
a. Low human development
b. Medium human development
c. High human development
d. Very high human development
27. High human development is denoted to a country which HDI ranges from
a. 0.0 to 0.499
b. 0.50 to 0.799
c. 0.80 to 0.90
d. 0.90 to 1.0
28. Each component of HDI is weighted
a. Gradually
b. Equally
c. Optimally
d. None of the above

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29. Each component of HDI is given a weight of
a. one-half
b. one-third
c. one-quarter
d. none of the above
30. some of the higher-income oil producers, have been said to have experienced
a. development without growth
b. growth without development
c. growth and development
d. none of the above
31. November 2010, the UNDP introduced
a. Traditional HDI
b. New HDI
c. Modern HDI
d. None of the above
32. The main difference(s) between traditional HDI and new HDI is that
a. Traditional HDI uses arithmetic mean in calculations while new HDI uses geometric
mean.
b. Traditional HDI uses gross domestic product per capita while new HDI uses Gross
national income per capita
c. The maximum values in each dimension have been increased in new HDI
d. All of the above
33. Developing World is characterized by
a. Lower Levels of Inequality and Absolute Poverty
b. Greater Social Fractionalization
c. higher Levels of Industrialization and Manufactured Exports
d. all of the above
34. Developing World is characterized by all of the following except
a. Developed Financial and Other markets
b. Higher Population Growth Rates
c. Lower levels of human capital
d. All of the above are characteristics of developing world
35. There is …………… correlation between country size in population or area and economic
development.
a. Positive
b. Negative
c. No
d. Volatile
36. In recent decades, most population growth has been centered in the …………..
a. Developed countries
b. Developing countries
c. Industrialized countries
d. None of the above
37. The proportion of people over the age of 65 is much greater in the ………………
a. Developed countries
b. Developing countries
c. Industrialized countries
d. None of the above
38. Older people and children are often referred to as
a. Labor force
b. Discouraged unemployment
c. dependency burden
d. none of the above

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39. ethnic, linguistic, and social divisions are known as
a. defragmentation
b. fractionalization
c. sophistication
d. none of the above
40. Along with lower industrialization, developing nations have tended to have a higher
dependence on …………………….
a. Luxury exports
b. primary exports
c. expensive exports
d. none of the above
41. Landlocked economies often have ………….. incomes than coastal economies
a. Higher
b. Lower
c. Plenty
d. None of the above
42. Some aspects of market underdevelopment are that they often lack
a. A stable and trustworthy currency
b. A legal system that enforces contracts
c. A well-developed and efficiently regulated system of banking and insurance
d. All of the above
43. Low-Income Countries Today Differ from Developed Countries in Their Earlier Stages in
a. Climate
b. International trade benefits
c. Efficiency of domestic institutions
d. All of the above
44. It has been observed that the economically most successful countries are located in the
a. subtropical climatic zones
b. tropical climatic zones
c. temperate zone
d. it does not matter
45. International free trade has been called the
a. engine of growth
b. engine of development
c. center of economy
d. none of the above

# Ans. # Ans. # Ans. # Ans. # Ans.

1 C 10 B 19 A 28 B 37 A
2 B 11 B 20 A 29 B 38 C
3 A 12 B 21 D 30 B 39 B
4 B 13 B 22 D 31 B 40 B
5 D 14 A 23 A 32 D 41 B
6 D 15 B 24 B 33 B 42 D
7 A 16 B 25 C 34 A 43 D
8 A 17 A 26 A 35 C 44 C
9 B 18 B 27 C 36 B 45 A

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