Title: Cat for Lesson 12 - Development
Course: 383-303-FD-55-01 • International Economics

Test info catégorie

True or false? Justify your answer.

Question

Underdevelopment refers to a country with a low per capita GDP.

Sélectionnez la meilleure réponse puis justifiez votre choix.

Réponse | Choix de réponses
1 | True
2 | False

Justification
Feedback: La(es) bonne(s) réponse(s) est(sont): 1, Although this indicator is not perfect, since it includes only commercial transactions that are subject to declarations or estimates, per capita GDP helps describe LDCs.
Feedback: La(es) bonne(s) réponse(s) est(sont): 1, Although this indicator is not perfect, since it includes only commercial transactions that are subject to declarations or estimates, per capita GDP helps describe LDCs.

True or false? Justify your answer.

Question

Underdevelopment specifically concerns LACs.

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Réponse | Choix de réponses
1 | True
2 | False

Justification
Feedback: La(es) bonne(s) réponse(s) est(sont): 1, LAC stands for least advanced country, i.e., the poorest group of countries among developing countries. They have the lowest per capita income as well as serious problems with population growth and debt.
Feedback: La(es) bonne(s) réponse(s) est(sont): 1, LAC stands for least advanced country, i.e., the poorest group of countries among developing countries. They have the lowest per capita income as well as serious problems with population growth and debt.

Question

To help define underdevelopment, why is it a good idea to use, in addition to per capita GDP, indicators such as life expectancy at birth, the mortality rate and the number of doctors per capita?

Entrez votre réponse ci-dessous.
Feedback: Per capita GDP is the indicator usually used to describe the standard of living of a country's population. For developing countries, additional indicators are used to more accurately measure not only the country's economic growth, but also its level of development. These indicators describe a country's socio-economic characteristics and thus provide more details about its level of development. These indicators include life expectancy at birth, mortality rate and number of doctors per capita.
Feedback: Per capita GDP is the indicator usually used to describe the standard of living of a country's population. For developing countries, additional indicators are used to more accurately measure not only the country's economic growth, but also its level of development. These indicators describe a country's socio-economic characteristics and thus provide more details about its level of development. These indicators include life expectancy at birth, mortality rate and number of doctors per capita.

Question

What does the human development index (HDI) tell us about a country?

Entrez votre réponse ci-dessous.
Feedback: The HDI is an underdevelopment indicator that provides information about the quality of life and level of development of a country's population. It is based on the following characteristics: life expectancy at birth, literacy rate of people over 15 years of age, schooling rate, and per capita income. It thus provides an accurate picture of a country's situation.
Feedback: The HDI is an underdevelopment indicator that provides information about the quality of life and level of development of a country's population. It is based on the following characteristics: life expectancy at birth, literacy rate of people over 15 years of age, schooling rate, and per capita income. It thus provides an accurate picture of a country's situation.

Q: Question

Match each of these countries with its production structure.
- Canada | Right-hand graph
- Haiti | Right-hand graph
Also offered: Left-hand graph
If right: You correctly matched the items. Less developed countries (LDCs) have production structures in which the primary sector is extremely large. Many LDCs have agricultural sectors that account for more than 30% of the GDP. Industrialized countries, on the other hand, have agricultural sectors that account for only 2 or 3% of the total production value; most of their activities are in the service sector.
If partly right: Votre réponse est partiellement correcte.
If wrong: Double-check your answers. Less developed countries (LDCs) have production structures in which the primary sector is extremely large. Many LDCs have agricultural sectors that account for more than 30% of the GDP. Industrialized countries, on the other hand, have agricultural sectors that account for only 2 or 3% of the total production value; most of their activities are in the service sector.

Question

Is the inequality of income distribution more apparent in LDCs than in industrialized countries?

Entrez votre réponse ci-dessous.
Feedback: The inequality is even greater in LDCs than in industrialized countries. In the Third World, the affluent class often has close ties with the ruling group. The affluent class commands the power of privilege to enable it to continue its activities: few taxes; assistance with building infrastructure; import or manufacture of luxury goods, etc. All these advantages cause greater inequality.
Feedback: The inequality is even greater in LDCs than in industrialized countries. In the Third World, the affluent class often has close ties with the ruling group. The affluent class commands the power of privilege to enable it to continue its activities: few taxes; assistance with building infrastructure; import or manufacture of luxury goods, etc. All these advantages cause greater inequality.

Q: Question

Find the false statement.
- The demographic issue is both a cause and a consequence of extreme poverty. (The second statement is false. Two extremely poor regions of the world are sub-Saharan Africa and South Asia; they have the highest population growth rates (2.6% and 1.9%). However¤ like other regions¤ over the past 30 years these regions have experienced a decrease in their growth rates: today¤ like everywhere in the world¤ the growth rate is lower than before.)
- Very poor regions are currently experiencing a noticeable decrease in population. (Correct. This statement is false.)
- Today¤ 85 countries¤ representing 95% of the Third World population¤ have adopted family planning programs. (The second statement is false. Two extremely poor regions of the world are sub-Saharan Africa and South Asia; they have the highest population growth rates (2.6% and 1.9%). However¤ like other regions¤ over the past 30 years these regions have experienced a decrease in their growth rates: today¤ like everywhere in the world¤ the growth rate is lower than before.)
- The world population will nearly double in 30 years. (The second statement is false. Two extremely poor regions of the world are sub-Saharan Africa and South Asia; they have the highest population growth rates (2.6% and 1.9%). However¤ like other regions¤ over the past 30 years these regions have experienced a decrease in their growth rates: today¤ like everywhere in the world¤ the growth rate is lower than before.)
A: Very poor regions are currently experiencing a noticeable decrease in population.

Question

The origin and consequences of the debt problem vary depending on the level of development of Third World countries.

Present the debt problem by explaining:

1. The origin and consequences for heavily indebted poor countries (HIPCs) in the Third World.

2. The origin and consequences for other Third World countries.

Entrez votre réponse ci-dessous.
Feedback: 1- For heavily indebted poor countries (HIPCs) in the Third World: The weak economic growth of these countries continually causes difficulties in paying their debts: - These countries have little savings. - The governments' ability collect tax revenue is almost non-existent (friends of governments have a considerable amount of money). - The governments' management capacity is often very poor (rampant corruption). This causes weak economic growth and little income to pay debts. Activist groups propose the simple cancellation of these countries' debts. To improve relations with these extremely poor countries, the governments of industrialized countries decided to move in this direction, but concrete action has not been very convincing. In 2002, HIPCs still had relatively high debts. 2- For other Third World countries: The debt crisis in these countries was due to two reasons: - Extremely high increase in interest rates at the beginning of the 1980s, which suddenly affected their variable rate loans. - The decrease in the price of raw materials, which affected the revenue from their main exports. In 1982, these countries were no longer able to make payments. Panic erupted in Third World countries as well as in the industrialized countries whose commercial banks had agreements with these countries. This situation undermined the solvency of North American and European banks. Major international lending institutions took over these loans. The IMF and the World Bank lent Third World countries money to pay off their private bank loans. However, there was a new condition: international institutions would grant loans provided that these countries implemented structural adjustment policies. These countries thus had to follow certain rules, including the privatization of government enterprises, tax reforms, deregulation of the labour market, and removal of subsidies on basic goods and services (electricity, transportation and water). Neo-liberal policies were therefore implemented.
Feedback: 1- For heavily indebted poor countries (HIPCs) in the Third World: The weak economic growth of these countries continually causes difficulties in paying their debts: - These countries have little savings. - The governments' ability collect tax revenue is almost non-existent (friends of governments have a considerable amount of money). - The governments' management capacity is often very poor (rampant corruption). This causes weak economic growth and little income to pay debts. Activist groups propose the simple cancellation of these countries' debts. To improve relations with these extremely poor countries, the governments of industrialized countries decided to move in this direction, but concrete action has not been very convincing. In 2002, HIPCs still had relatively high debts. 2- For other Third World countries: The debt crisis in these countries was due to two reasons: - Extremely high increase in interest rates at the beginning of the 1980s, which suddenly affected their variable rate loans. - The decrease in the price of raw materials, which affected the revenue from their main exports. In 1982, these countries were no longer able to make payments. Panic erupted in Third World countries as well as in the industrialized countries whose commercial banks had agreements with these countries. This situation undermined the solvency of North American and European banks. Major international lending institutions took over these loans. The IMF and the World Bank lent Third World countries money to pay off their private bank loans. However, there was a new condition: international institutions would grant loans provided that these countries implemented structural adjustment policies. These countries thus had to follow certain rules, including the privatization of government enterprises, tax reforms, deregulation of the labour market, and removal of subsidies on basic goods and services (electricity, transportation and water). Neo-liberal policies were therefore implemented.

Question

Propose possible solutions to the debt problem.

Entrez votre réponse ci-dessous.
Feedback: Jubilee 2000, a group of activists, proposed the following solutions: - Cancel the Third World's public external debt of about $1,600 billion, which is less than 5% of the nearly $40,000 billion in world debt. This assistance would not cost a lot for rich countries and would eliminate serious injustices. - Discontinue structural adjustment policies, which have harmful effects on disadvantaged LDC populations. In fact, the devaluation of the national currency, the rise in interest rates within the country, the elimination of exchange control, the privatization of government enterprises and the deregulation of the labour and trade markets have harmful effects, including a rise in production costs, a rise in local prices and stronger competition. This reduces consumers' purchasing power and lowers the standard of living of the majority of the population. - Fulfill the commitments previously made by United Nations countries. For example, industrialized countries should give more by increasing the ratio of Official Development Assistance to 0.7% of their GDP. - Agree to more carefully consider developing countries' demands in trade negotiation organizations. This involves discussing issues that concern these countries and ensuring that the adopted resolutions do not go unheeded.
Feedback: Jubilee 2000, a group of activists, proposed the following solutions: - Cancel the Third World's public external debt of about $1,600 billion, which is less than 5% of the nearly $40,000 billion in world debt. This assistance would not cost a lot for rich countries and would eliminate serious injustices. - Discontinue structural adjustment policies, which have harmful effects on disadvantaged LDC populations. In fact, the devaluation of the national currency, the rise in interest rates within the country, the elimination of exchange control, the privatization of government enterprises and the deregulation of the labour and trade markets have harmful effects, including a rise in production costs, a rise in local prices and stronger competition. This reduces consumers' purchasing power and lowers the standard of living of the majority of the population. - Fulfill the commitments previously made by United Nations countries. For example, industrialized countries should give more by increasing the ratio of Official Development Assistance to 0.7% of their GDP. - Agree to more carefully consider developing countries' demands in trade negotiation organizations. This involves discussing issues that concern these countries and ensuring that the adopted resolutions do not go unheeded.

True or false? Justify your answer if you think the statement is false.

Question

Official Development Assistance (ODA) consists of money that richer countries give to poorer countries. This money is allocated either directly or through multilateral assistance institutions.

Sélectionnez la meilleure réponse puis justifiez votre choix.

Réponse | Choix de réponses
1 | True
2 | False

Justification
Feedback: La(es) bonne(s) réponse(s) est(sont): 1, Countries initially gave money directly to countries that were often their former colonies. More recently, since the post-war period, donor countries have been donating through multilateral assistance organizations.
Feedback: La(es) bonne(s) réponse(s) est(sont): 1, Countries initially gave money directly to countries that were often their former colonies. More recently, since the post-war period, donor countries have been donating through multilateral assistance organizations.

True or false?

Question

ODA is part of the international cooperation budget in Canada and many other countries.

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Réponse | Choix de réponses
1 | True
2 | False

Justification
Feedback: La(es) bonne(s) réponse(s) est(sont): 1, Funds spent by Canada are often recorded as expenditures of the Canadian International Development Agency (CIDA). In reality, these funds are loans and donations that Canada gives to poorer countries, usually by taking part in international cooperation projects.
Feedback: La(es) bonne(s) réponse(s) est(sont): 1, Funds spent by Canada are often recorded as expenditures of the Canadian International Development Agency (CIDA). In reality, these funds are loans and donations that Canada gives to poorer countries, usually by taking part in international cooperation projects.

True or false?

Question

Official Development Assistance (ODA) is criticized because the poorest countries do not receive the greatest portion.

Sélectionnez la meilleure réponse puis justifiez votre choix.

Réponse | Choix de réponses
1 | True
2 | False

Justification
Feedback: La(es) bonne(s) réponse(s) est(sont): 2, This statement is false. The regions that receive nearly 40% of the total ODA are the two poorest regions, i.e., sub-Saharan Africa and South Asia. ODA is thus granted to the poorest countries. However, the fact that industrialized countries do not give enough is often criticized. They had promised to give 0.7% of their GDP in ODA and the statistics show that they only give 0.23%. These countries thus still have a long way to go before donating what they promised.
Feedback: La(es) bonne(s) réponse(s) est(sont): 2, This statement is false. The regions that receive nearly 40% of the total ODA are the two poorest regions, i.e., sub-Saharan Africa and South Asia. ODA is thus granted to the poorest countries. However, the fact that industrialized countries do not give enough is often criticized. They had promised to give 0.7% of their GDP in ODA and the statistics show that they only give 0.23%. These countries thus still have a long way to go before donating what they promised.

Question

What is the best-known development theory called?

Entrez votre réponse ci-dessous.
Feedback: W.W. Rostow's stages of economic growth theory.
Feedback: W.W. Rostow's stages of economic growth theory.

Question

If you had to explain W.W. Rostow's theory to someone, what would you say?

Entrez votre réponse ci-dessous.
Feedback: W.W. Rostow's theory deals with stages of economic growth and identifies five stages of development that any society has gone or will go through: - Traditional society - Preconditions for takeoff - Takeoff - Drive to maturity - Age of high mass consumption
Feedback: W.W. Rostow's theory deals with stages of economic growth and identifies five stages of development that any society has gone or will go through: - Traditional society - Preconditions for takeoff - Takeoff - Drive to maturity - Age of high mass consumption