Growth and Development-Online Practice Exam 1
Growth and Development-Online Practice Exam 1

Growth and Development-Online Practice Exam 1

NET / SET Online Practice Exams

Growth and Development

Test

Multi-choice 1

Question

1. If the K/O ratio is 5 the population growth rate is 2 per cent and society wants to achieve a per capita growth rate of 3.5 per cent, what is the value of saving ratio? 

Answers

10.5

3.5

5.5

27.5

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Question

2. Underdevelopment has been a result of ____ factors.

Answers

Economic

Social

Political

All of the above

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Question

3. Kuznets found that when compared to the upper 10 per cent of income recipients in developed countries, the upper 10 per cent of income recipients in less developed countries receive-

Answers

A large percentage of national income before taxes

A smaller percentage of national income before taxes

The same percentage of national income after taxes

An insignificant percentage of national income

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Question

4. Investment projects should be capital intensive because they would lead to greater savings and investment in future. This is advocated by-

Answers

H. Leibenstein

H. Leibenstein and W. Galenson

W: Galenson

W. Galenson and R. Nurkse

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Question

5. Which one of the following is not necessarily a characteristic of an underdeveloped economy ?

Answers

Low per capita income

Insufficiency of natural resources

Inadequate capital resources

Widespread unemployment

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6. According to H. Leibenstein-

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The underdeveloped countries are poor because they have a low capital to save and invest

The population upsurge is the main obstacle to the economic growth of underdeveloped countries

Due to their subsistence structure the underdeveloped countries are caught in the Malthusian low equilibrium trap

All of the above

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Question

7. Economists point out several possible sources of untapped private domestic savings in less developed countries. Which of the following is not one of them ?

Answers

There can be voluntary reduction in consumption, thereby freeing additional resources for investment

Unemployed or underemployed labour can be absorbed in the productive economy, increasing national income and the possibility of savings 

The government can require citizens to purchase long-term, non-negotiable bonds, and finance national investment programmes through private savings

Establishment of a State Marketing Boar for exports which may enable the govenment to purchase domestic goods

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Question

8. The balanced growth theory sees the primary cause of underdevelopment as the-

Answers

Foreign domination

Low level of technology

Small size of the market

Lack of savings

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Question

9. The basic rationale of the theory of “big push” is based upon the idea of-

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External economics 

Size of population

Internal economics

None of these

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Question

10. Classical investment theory advocates normally all of the following except-

Answers

Perfect competition

Absence of externalities

A state of general equilibrium 

A living wage

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