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19 Cards in this Set
- Front
- Back
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1. An argument in favor of foreign direct investment is that it tends to (a) reduce inequality. (b) promote rural development. (c) increase access to modern technology. (d) decrease local ownership. (e) none of the above. |
(c) increase access to modern technology. |
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2. Which of the following is an argument against MNCs? (a) A reduction in inequality. (b) An increase in the use of labor intensive technology. (c) A deterioration of the balance of payments accounts. (d) An increase in government tax revenue. (e) None of the above. |
(c) A deterioration of the balance of payments accounts. |
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3. One of the significant criticisms of MNCs is (a) the relatively low wages they pay. (b) on balance they bring in more capital than officially registered. (c) increased monetary policy effectiveness. (d) all of the above. (e) none of the above. |
(e) none of the above. |
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4. The amount of foreign aid in proportion to developed countries’ GNP has (a) increased over time. (b) remained fairly stable over time. (c) decreased over time. (d) fluctuated widely but has shown no clear trend. |
(c) decreased over time. |
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5. MNCs can often decrease their tax liability through (a) use of more capital-intensive techniques. (b) use of transfer pricing. (c) use of more foreign input sources. (d) bargaining with the host country. (e) none of the above. |
(b) use of transfer pricing. |
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A motivation of developed countries in providing development assistance is a. the creation of markets b. geopolitical influence c. genuine humanitarian concern d. all of the above d. none of the above |
d. all of the above |
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With tied aid a. MNC investment depends on tax concessions b. aid recipients must use the aid to purchase goods and services from the donor c. aid recipients must follow World Bank/IMF conditionality d. all of the above |
b. aid recipients must use the aid to purchase goods and services from the donor |
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The developing area receiving the largest share of direct foreign investment is/are a. Africa b. Asia c. Latin America d. transition economies |
b. Asia |
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Which of the following is not a type of portfolio investment? a. Investment in stocks b. Multinational corporation investment c. Investment in commercial paper d. All are types of portfolio investment e. None are types of portfolio investment |
b. Multinational corporation investment |
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The best explanation for the late 1944/early 1955 collapse of the Mexican peso and stock market is a. free movement of capital internationally is destabilizing for a developing country b. portfolio investments were camouflaging overvalued exchange rates c. debt for equity swaps had created imbalances in the ownership structure of the economy d. the potential benefits of NAFTA had been oversold |
b. portfolio investments were camouflaging overvalued exchange rates |
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In the two-gap model, which of the following gaps, when binding, leads to foreign aid having the largest impact on GNP? a. Fiscal gap b. Savings gap c. Foreign exchange gap d. None of the above |
c. Foreign exchange gap |
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Voluntary organizations that work with and on behalf of mostly local grassroots organizations in developing countries are termed a. international organizations b. nongovernmental organizations c. multilateral institutions d. equity organizations e. none of the above |
b. nongovernmental organizations |
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A model comparing savings and foreign exchange constraints to see which is binding for economic growth is known as a a. project appraisal b. two-gap model c. computable general equilibrium d. trickle down model e. none of the above |
b. two-gap model |
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Which of the following countries regularly meets the UN target for the provision of foreign aid(as a percent of GNI)? a. Japan b. United States c. Denmark d. France |
c. Denmark |
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During 1990-2003, as a percentage of total resources flowed to developing countries, the share of official flows a. remained relatively constant b. increased by a relatively small percentage c. increased by a relatively large percentage d.decreased by a relatively small percentage e.decreased by a relatively large percentage |
e. decreased by a relatively large percentage |
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As a percentage of GNI, which of the following countries provides the greatest amount of foreign aid? a. United Kingdom b. United States c. Italy d. Sweden |
d. Sweden |
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As an absolute amount (billions of dollars), which of the following countries provides the greatest amount of foreign aid? a. United Kingdom b. United States c. Italy d. Sweden |
b. United States |
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The direct benefits of out-migration to a developing nation include a. loss of skilled workers b. increased remittances c. job growth d. larger capital formation |
b. increased remittances |
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The largest recipient of remittances in dollars in the year 2004 was a. India b. Mexico c. Pakistan d. The Philippines |
a. India |
