MCQOPTIONS
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MCQOPTIONS
This section includes 19 Mcqs, each offering curated multiple-choice questions to sharpen your Economics Mcqs knowledge and support exam preparation. Choose a topic below to get started.
| 1. |
Which of the following statement is Not true ? |
| A. | The ratio of debt service to GNP is very good indicator of the debt burden |
| B. | Many large LDC debtors borrowed heavily because of their excellent international credit ratings |
| C. | Middle income countries account for almost four-fifths of the total outstanding debt of all LDCs |
| D. | The debt-burden of sub Saharan African countries may be as heavy as for middle income countries |
| Answer» B. Many large LDC debtors borrowed heavily because of their excellent international credit ratings | |
| 2. |
The Baker plan (1985) stressed _______ and the Brady Plan (1989) emphasized _______ respectively? |
| A. | IMF decentralization; World Bank dissolution |
| B. | new loans from multilateral agencies and surplus countries; debt reduction or write-downs |
| C. | structural adjustment loans for LDCs experiencing unanticipated external shocks; renewed emphases on macroeconomic stabilization programs |
| D. | debt relief for at leas three-fourths of the eligible HIPCs; shorter requirements for adjustment programs |
| Answer» C. structural adjustment loans for LDCs experiencing unanticipated external shocks; renewed emphases on macroeconomic stabilization programs | |
| 3. |
Shortly after 1979 World Bank introduced loans that emphasized reforms in trade, agriculture industry public enterprise financial energy education or other sectors and were known as ? |
| A. | Structural adjustment loans |
| B. | sectoral adjustment loans |
| C. | internal adjustment loans |
| D. | external leverage loans |
| Answer» C. internal adjustment loans | |
| 4. |
Initial conditions in the year before the crisis in Thailand Indonesia Malaysia the Philippines and Korea in 1997 indicate that ?
|
| A. | I and IV only |
| B. | II and III only |
| C. | I, II and III only |
| D. | II, III and IV only |
| Answer» E. | |
| 5. |
Which of the following country was not a major LDC debtor in 2001 ? |
| A. | Brazil |
| B. | Argentina |
| C. | Thailand |
| D. | Malaysia |
| Answer» E. | |
| 6. |
The debt-service ratio is the______________? |
| A. | long-term debt divided by GDP of a country in a given year |
| B. | interest and principle payments divided by exports of goods and services |
| C. | ratio of debt net of portfolio investment financing and foreign direct investment |
| D. | default and reschedule debt minus annual export revenues that must be devoted to paying interest |
| Answer» C. ratio of debt net of portfolio investment financing and foreign direct investment | |
| 7. |
Which of the following is will NOT reduce capital flight from source countries ? |
| A. | dependable positive real interest rates |
| B. | higher taxes on capital gains |
| C. | more efficient state enterprises |
| D. | market liberalization |
| Answer» C. more efficient state enterprises | |
| 8. |
Shortly after 1979 World Bank introduced loans that emphasized reforms in trade, agriculture industry public enterprise financial energy education or other sectors and were know as ? |
| A. | Structural adjustment loans |
| B. | sectoral adjustment loans |
| C. | internal adjustment loans |
| D. | external leverage loans |
| Answer» C. internal adjustment loans | |
| 9. |
Mosley Harrigan and Toye refer to the IMF and World Bank as________________? |
| A. | excessively committed to writing down LDC debt |
| B. | a managed duopoly of policy advice |
| C. | a U.S monoply |
| D. | the initiator of HIPCs debt forgiveness |
| Answer» C. a U.S monoply | |
| 10. |
The policy cartel on debt reduction refers to the_______________? |
| A. | screening of debtors based on their regional location |
| B. | World Bank requiring LDCs seconded by a DC to get loan reduction |
| C. | loan denial to crisis-stricken highly indebted countries |
| D. | None of the above |
| Answer» E. | |
| 11. |
Fundamentalists want the IMF to lend to crisis-stricken countries on condition that they undertake fundamental structural reforms in banking Joseph Stiglitz however thinks it is______________? |
| A. | unrealistic for IMF to intervene in the financial markets of poor countries during the crisis |
| B. | impractical for the IMF to loan short term as reforms can only be effective in the middle to long run |
| C. | crucial that the IMF intervene in the reform of fiscal policy of the country and not the monetary policy |
| D. | None of the statements above is correct |
| Answer» C. crucial that the IMF intervene in the reform of fiscal policy of the country and not the monetary policy | |
| 12. |
A country’s total external debt (EDT) includes ?
|
| A. | I and II only |
| B. | III and IV only |
| C. | I, II and III only |
| D. | I, II and IV only |
| Answer» D. I, II and IV only | |
| 13. |
Which of the following country did not experience large capital flights from 1976 to 1984 ? |
| A. | Argentina |
| B. | Venezuela |
| C. | Mexico |
| D. | Canada |
| Answer» E. | |
| 14. |
Which of the following country did Not suffer from increased poverty from debt and financial crises in the 1990s ? |
| A. | Singapore (1994) |
| B. | Mexico (1994) |
| C. | Russia (1998) |
| D. | Brazil (1998) |
| Answer» B. Mexico (1994) | |
| 15. |
Net transfers are______________? |
| A. | investment loans, and grants from overseas minus international resource outflows |
| B. | net international resource flows minus net international interest payments and profit remittances |
| C. | international resource outflows minus international balance of payments and profit remittances |
| D. | foreign direct investment inflow minus investment loans and grants from overseas |
| Answer» C. international resource outflows minus international balance of payments and profit remittances | |
| 16. |
Which of the following factors potentially increased the vulnerability to the 1997 Asian financial and currency crisis ? |
| A. | trade account surplus |
| B. | massive reverse outflows of capital |
| C. | technological transfer from DCs |
| D. | Symmetric informational in financial market |
| Answer» C. technological transfer from DCs | |
| 17. |
Which of the following is Not true about external debt ? |
| A. | External debt accumulates with international balance on goods services and income deficcits |
| B. | When debts are denominated in U.S dollars their appreciation during the 1990s increased the cost of servicing such debts |
| C. | In the 19901s LDCs relied increasingly on aid from DCs |
| D. | International lenders required LDC governments to guarantee private debt |
| Answer» D. International lenders required LDC governments to guarantee private debt | |
| 18. |
Highly-indebted poor countries (HIPCs) include________________?
|
| A. | I and II only |
| B. | I, II , III only |
| C. | I, III and IV only |
| D. | I, II , III and IV |
| Answer» E. | |
| 19. |
In 1990, during the Persian Gulf War, the U.S government extended generous terms to two middle-income countries by canceling or reducing their debt The two countries were ? |
| A. | Iraq and Iran |
| B. | Egypt and Poland |
| C. | Pakistan and Afghanistan |
| D. | Saudi Arabia and Jordan |
| Answer» C. Pakistan and Afghanistan | |