Economic Growth and Development Quizzes - Test Your Knowledge

Question 1

Which factor is the primary driver of sustained economic growth in developing countries?

Accepted Answer

Increased investment in education and healthcare

Answer

Excessive government spending

Answer

Rapid population growth without adequate resource allocation

Answer

Stringent government regulations on businesses

Question 2

According to the Rostow model of economic development, which stage follows the traditional society stage and is characterized by a shift from traditional agriculture to industrialization?

Accepted Answer

Preconditions for take-off

Answer

Take-off

Answer

Drive to maturity

Answer

Age of mass consumption

Question 3

Which criticism is most commonly associated with the trickle-down theory?

Accepted Answer

It can exacerbate income inequality.

Answer

It assumes that tax cuts for the wealthy will stimulate investment.

Answer

It ignores the multiplier effect of government spending.

Answer

It is supported by extensive empirical evidence.

Question 4

What is the relationship between economic growth and environmental sustainability in the long run?

Accepted Answer

They can have a trade-off.

Answer

They are mutually exclusive.

Answer

They are always positively correlated.

Answer

They have no relationship.

Question 5

What is the concept of "creative destruction" in economics?

Accepted Answer

The process by which new technologies and innovations replace old ones, leading to economic growth.

Answer

The process by which governments destroy businesses in order to promote competition.

Answer

The process by which consumers destroy products in order to stimulate demand.

Answer

The process by which businesses create new products and services without replacing old ones.

Question 6

Identify the key factor that does NOT contribute to economic growth.

Accepted Answer

Depletion of natural resources

Answer

Technological advancement

Answer

Investment in human capital

Answer

Capital accumulation

Question 7

Identify the economic policy that typically involves government measures to stimulate aggregate demand.

Accepted Answer

Fiscal policy

Answer

Monetary policy

Answer

Supply-side policy

Answer

Inflation targeting

Question 8

What concept describes the long-term trend of increasing output per worker?

Accepted Answer

Productivity growth

Answer

Economic growth

Answer

Capital accumulation

Answer

Technological progress

Question 9

Which characteristic is typical of a less developed country?

Accepted Answer

Subsistence farming

Answer

High GDP per capita

Answer

Advanced infrastructure

Answer

Universal literacy

Question 10

The theory of comparative advantage suggests that countries should specialize in producing and exporting goods or services:

Accepted Answer

That they produce most efficiently

Answer

That they have the highest demand for

Answer

With the lowest cost of production

Answer

That they need to import from other countries

Question 11

Which economic system is characterized by private ownership of the means of production and free markets?

Accepted Answer

Capitalism

Answer

Collectivism

Answer

Socialism

Answer

Communism

Question 12

What is the term for the process of converting raw materials into finished goods or products?

Accepted Answer

Production

Answer

Consumption

Answer

Distribution

Answer

Exchange

Question 13

What do 'external economies' refer to?

Accepted Answer

Benefits that accrue to all firms in an industry

Answer

Benefits that accrue to individual firms

Answer

Costs imposed on third parties

Answer

Costs imposed on the government

Question 14

Which of the following terms describes a country's transition from a primarily agricultural economy to an industrial one?

Accepted Answer

Industrial Revolution

Answer

Kuznets Curve

Answer

Solow Growth Model

Answer

Human Capital Theory

Question 15

Among the listed roles of government, which one is NOT typically considered a strategy for fostering economic growth?

Accepted Answer

Imposition of high taxes on businesses

Answer

Provision of essential public infrastructure

Answer

Targeted investments in research and development

Answer

Enforcement and protection of property rights

Question 16

The Solow Growth Model primarily focuses on which factor as a driver of economic growth?

Accepted Answer

Diminishing returns to capital investment

Answer

Exogenous drivers of technological advancements

Answer

Endogenous growth driven by innovation

Answer

Perfectly competitive markets with minimal government intervention

Question 17

In the context of developing countries, what is the primary objective of macroeconomic policy?

Accepted Answer

Stimulating economic growth

Answer

Achieving price stability

Answer

Ensuring full employment

Answer

Maintaining balance of payments stability

Question 18

Which of the following factors is NOT considered a key determinant of economic growth?

Accepted Answer

Political stability

Answer

Physical capital (e.g., infrastructure, machinery)

Answer

Human capital (e.g., education, skills)

Answer

Natural resources (e.g., oil, minerals)

Question 19

Which characteristic is typically associated with developing economies?

Accepted Answer

Low levels of educational attainment

Answer

High levels of industrialization

Answer

Low levels of income inequality

Answer

Well-developed financial markets

Question 20

Which measure is commonly used to quantify economic growth?

Accepted Answer

Gross domestic product (GDP)

Answer

Unemployment rate

Answer

Inflation rate

Answer

Balance of payments

Question 21

How is economic growth related to poverty?

Accepted Answer

The relationship depends on various factors.

Answer

Economic growth can reduce poverty.

Answer

Economic growth can worsen poverty.

Answer

Economic growth has no impact on poverty.

Question 22

In the Rostowian model of economic development, what stage is characterized by a predominantly agricultural economy?

Accepted Answer

Traditional society

Answer

Preconditions for takeoff

Answer

Takeoff

Answer

Drive to maturity

Question 23

Which characteristic is NOT typically associated with developing economies?

Accepted Answer

Advanced technology

Answer

Low capital accumulation

Answer

High reliance on agriculture

Answer

Rapid population growth

Question 24

Which of the following government policies is generally considered to promote economic growth?

Accepted Answer

Investment in infrastructure and education

Answer

Fiscal austerity

Answer

Tight capital controls

Answer

Imposition of high tariffs

Question 25

What is a key characteristic that distinguishes a developing country?

Accepted Answer

Low per capita income

Answer

Stable political system

Answer

High levels of education

Answer

Advanced technological capabilities

Question 26

What is a potential negative consequence of rapid economic growth?

Accepted Answer

Environmental degradation

Answer

Reduced income inequality

Answer

Increased social cohesion

Answer

Lower poverty levels

Question 27

What is a primary purpose of economic development?

Accepted Answer

Improving living standards

Answer

Balancing the budget

Answer

Reducing unemployment

Answer

Maintaining a stable exchange rate

Question 28

Which characteristic is typical of traditional economic systems?

Accepted Answer

Production rooted in customs and traditions

Answer

High innovation levels

Answer

Dominance of international trade

Answer

Extensive use of advanced technologies

Question 29

What is a potential benefit of economic growth?

Accepted Answer

Increased availability of goods and services

Answer

Environmental damage

Answer

Reduced social mobility

Answer

Widening income gaps

Question 30

Which factor can potentially hinder economic development?

Accepted Answer

Political instability

Answer

High education levels

Answer

Favorable geographic location

Answer

Abundant natural resources

Question 31

Which factor is most commonly NOT considered a major determinant of economic growth?

Accepted Answer

Population size

Answer

Capital accumulation

Answer

Technological progress

Answer

Education

Question 32

The Rostowian model of economic development suggests that the first stage is characterized by:

Accepted Answer

Traditional society

Answer

Age of science

Answer

High mass consumption

Answer

Take-off stage

Question 33

Which of the following is a potential benefit of economic growth?

Accepted Answer

Increased standard of living

Answer

Environmental degradation

Answer

Social unrest

Answer

Increased income inequality

Question 34

Which of the following is a typical characteristic of developed economies?

Accepted Answer

High levels of skilled labor force

Answer

Low literacy rates

Answer

Predominance of agriculture

Answer

Limited access to healthcare

Question 35

The concept of 'catch-up growth' refers to:

Accepted Answer

Developing countries experiencing faster economic growth rates than developed countries

Answer

Developed countries experiencing faster economic growth rates than developing countries

Answer

The gap between the growth rates of developing and developed countries remaining constant

Question 36

Which of the following could be a potential challenge to economic development?

Accepted Answer

Political instability

Answer

Strong financial system

Answer

Abundant natural resources

Answer

Well-educated workforce

Question 37

The Human Development Index (HDI) primarily measures a country's:

Accepted Answer

Overall quality of life

Answer

Political freedom

Answer

Economic growth rate

Answer

Environmental sustainability

Question 38

The concept of 'sustainable development' prioritizes:

Accepted Answer

Meeting the needs of the present without compromising the ability of future generations to meet their own needs

Answer

Maximizing short-term economic gains

Question 39

Which of the following is a key determinant of economic growth?

Accepted Answer

Technological advancements

Answer

Reduced investment in education

Answer

Population decline

Answer

Increased government regulation

Question 40

According to Rostow's Model of Economic Development, which stage is characterized by rapid industrialization and investment?

Accepted Answer

Take-off

Answer

Drive to maturity

Answer

Traditional society

Answer

Preconditions for take-off

Question 41

Which type of economic policy advocates for reducing government intervention in the economy to stimulate growth?

Accepted Answer

Laissez-faire

Answer

Keynesian economics

Answer

Marxist economics

Answer

Monetarism

Question 42

Which of the following is a potential advantage of economic growth?

Accepted Answer

Increased employment opportunities

Answer

Rising income inequality

Answer

Reduced demand for goods and services

Answer

Environmental degradation

Question 43

Which characteristic is typical of a developing economy?

Accepted Answer

High levels of poverty

Answer

Stable political institutions

Answer

Extensive industrialization

Answer

Advanced technological infrastructure

Question 44

Which obstacle can impede economic growth in developing countries?

Accepted Answer

Inadequate access to education

Answer

Well-developed financial markets

Answer

Abundant natural resources

Answer

Strong property rights

Question 45

Which indicator is used to measure both economic and social progress?

Accepted Answer

Human Development Index

Answer

Gross Domestic Product

Answer

Life expectancy

Answer

Literacy rate

Question 46

Which concept emphasizes meeting the needs of the present  without compromising the ability of future generations to meet their own needs?

Accepted Answer

Sustainable economic development

Answer

Exponential economic growth

Answer

Absolute economic equality

Question 47

Which characteristic is associated with a developed economy?

Accepted Answer

High standard of living

Answer

Low levels of literacy

Answer

High rates of unemployment

Answer

Limited access to healthcare

Question 48

Which benefit is associated with economic development?

Accepted Answer

Improved access to clean water

Answer

Political instability

Answer

Widening wealth gap

Answer

Increased air pollution

Question 49

Which of the following factors is considered a key driver of long-term economic growth?

Accepted Answer

Investment in human capital, such as education and healthcare

Answer

Abundant availability of natural resources

Answer

Favorable weather conditions for agriculture

Answer

High levels of government spending on social programs

Question 50

What is a primary role of government in fostering economic growth?

Accepted Answer

Providing and maintaining essential infrastructure, such as transportation and communication networks

Answer

Controlling the prices of essential goods and services to ensure affordability

Answer

Imposing restrictions on international trade to protect domestic industries

Answer

Nationalizing key industries to control production

Question 51

Which of the following presents a significant obstacle to economic development in many countries?

Accepted Answer

Limited access to advanced technologies, hindering innovation and productivity

Answer

Abundance of natural resources, providing a foundation for economic activity

Answer

Political stability and strong institutions

Question 52

What is a key objective of sustainable economic development?

Accepted Answer

Balancing economic growth with environmental protection to ensure long-term prosperity

Answer

Reducing government regulation to promote business freedom

Answer

Maximizing short-term profits, even if it leads to environmental harm

Question 53

Which of the following is a widely used metric to measure economic growth?

Accepted Answer

Gross Domestic Product (GDP), representing the total value of goods and services produced in a country

Answer

Balance of payments, reflecting the difference between a country's exports and imports

Answer

Consumer Price Index (CPI), measuring the average change in prices of consumer goods and services

Answer

Unemployment rate, indicating the percentage of the workforce without jobs

Question 54

Which of the following factors can contribute to economic stagnation?

Accepted Answer

Low levels of investment, hindering business expansion and job creation

Answer

High productivity, leading to efficient production and economic growth

Answer

Technological advancements, driving innovation and economic progress

Answer

Favorable trading conditions, promoting exports and economic activity

Question 55

What is a potential negative consequence of rapid economic growth?

Accepted Answer

Environmental degradation, as increased production and consumption can lead to pollution and resource depletion

Answer

Reduced poverty, as economic growth can provide opportunities for employment and income

Answer

Increased social cohesion, as economic prosperity can foster a sense of community

Answer

Improved healthcare, as economic development can lead to increased investment in public health