Questions Answer

The objective of development is sustained improvement, in the well- FALSE

FALSE
Three objectives of development include: to make people’s lives better;
to improve the people’s income; and sustained improvements over
many years.

FALSE
Three core values of development include: sustenance, self-esteem, and
safety.

TRUE
Human development is different from economic development.

TRUE
The Human development index (HDI) is measured as the total of years
of life expectancy, years of schooling, and dollars of income.

FALSE
Development is most successful when an economy creates only a
healthy quantity.

FALSE
Comprehensive wealth (also referred to as total wealth) is made up of
only (1) produced capital (buildings, roads, machinery and equipment),
(2) natural capital (minerals and fossil fuels, forests, agricultural land,
and protected areas).

FALSE
The nature of development economics is the study of only how
economies overcome issues related to extreme poverty.
 FALSE
Economic growth is also equal to growth in the per capita value of
everything produced the economy, so economic growth becomes the
unique determinant of development

FALSE
Long-term development with the potential to raise well-being for all
members of society, and to erase vast differences in living standards
across countries, must involve income distribution equality.

FALSE
The most common measure of economic growth is human
development index

TRUE
GDP is used to measure the total value of only produced goods and
services.

FALSE
The difference between the intermediate and final goods is called the
real value of working labor.

FALSE
The difference between nominal GDP and real GDP is that nominal
GDP is valued by the base-year price, while real GDP is valued by the
current price.

FALSE
GDP is the measure incorporating all economic activities of a country.

FALSE
A country experiences an economic growth rate of 4% per year, based
on the rule 72, the country must take 24 years later to double its growth
rate.
 FALSE
Entrepreneurs’ ability to turn the production factors into output is
limited by the technology which allows the firm to obtain more output,
or higher-value output from given quantity of labors

FALSE
The ingredients of successful economic growth include the types of
economic change increasing only firm-level labor productivity.

FALSE
APL (average product to labor) and MPL (marginal product to labor)
are the same.

FALSE
Total factor productivity (TFP) is defined as the portion of the rate of
growth in aggregate labor productivity that cannot be explained as the
result of increases in physical capital.

FALSE
Social inequality refers to the unequal distribution of only income
within an economy,

FALSE
The more the Lorenz line curves away from the diagonal, the greater
the degree of equality represented

TRUE
The poverty line is the value of the selected well-being indicator that
marks the minimally acceptable level, below which people merit
special policy attention

TRUE
Inequality may lead to an inefficient allocation of assets
 TRUE
Population optimists would view population growth as having the
potential to increase factor productivity

TRUE
No policy measures will be successful in controlling fertility unless
efforts are made to raise the social and economic status of women and
hence create conditions favorable to delayed marriage and lower
marital fertility

TRUE
The formal sector in which jobs conform to the developed country
norm

TRUE
The informal sector is so much larger in developing countries.

TRUE
Health and education levels are much higher in high-income countries

TRUE
The relationship between income and nutrition, education is quite low
in low-income countries

TRUE
People with higher education will work full time at a later age with
much higher income which outpace people working at earlier age

TRUE
Greater health capital may raise the return on investment in education.

TRUE
Greater education capital may raise the return on investment in health.

TRUE
Demand for education is derived demand function.