Question 1

The rapid growth rates of less developed countries (LDCs) after adopting institutions and policies more favorable to economic freedom and voluntary exchange is not surprising when one considers that

Accepted Answer

LDCs can benefit from technology transfer and good practices from more developed countries, leading to more rapid economic growth when they adopt institutions and policies that promote economic freedom and voluntary exchange.

Question 2

Researchers have found that countries that were settled by Europeans who planned on staying permanently were

Accepted Answer

The research shows that countries settled by Europeans who planned on staying permanently were more likely to have institutions that protected private ownership rights and limited the power of the government. This is because these settlers intended to establish permanent homes and businesses, so they had an interest in having stable institutions that protected their property rights and limited arbitrary government actions that could harm their interests.

Question 3

The Economic Freedom of the World measure indicates that the United States

Accepted Answer

According to the Economic Freedom of the World index, the United States has experienced a decline in economic freedom since 2000. In 2010, it was ranked as the 18th freest economy in the world.

Question 4

Which of the following is true of technology?

Accepted Answer

The answer of Which of the following is true of...

Question 5

Which countries undertook economic reforms in the 1960's that resulted in more economic freedom and stronger economic growth?

Accepted Answer

Hong Kong and Singapore implemented significant economic reforms in the 1960s, focusing on free-market policies, trade liberalization, and attracting foreign investment, which led to substantial economic growth and increased economic freedom.

Question 6

(I) Historically, countries with colonial settlers who planned on staying for long periods of time set up sound economic institutions. (II) Countries with harsh environments not suitable for permanent settlements resulted in colonial settlers adopting weaker and less productive economic institutions before leaving.

Accepted Answer

The answer of (I) Historically, countries with colonial settlers who...

Question 7

Which of the following countries have instituted liberal reforms and substantially improved their economic freedom rating since 1990?

Accepted Answer

Estonia and Hungary have implemented significant liberal reforms since 1990, transitioning from centrally planned economies to market-oriented ones, which has improved their economic freedom ratings.

Question 8

Which of the following countries began liberal economic reforms during the 1980s and now have significantly more economic freedom than during the mid-1980s?

Accepted Answer

Ireland and New Zealand both implemented significant economic reforms in the 1980s, leading to increased economic freedom and growth.

Question 9

Which of the following countries began economic liberalization in the 1970s and have achieved an impressive record of economic growth since that time?

Accepted Answer

China began its economic liberalization in 1978 under Deng Xiaoping, leading to rapid economic growth. Chile started its economic reforms in the mid-1970s under the military government, which also resulted in significant economic growth.

Question 10

During the 2000-2009 decade,

Accepted Answer

The answer of During the 2000-2009 decade,
...

Question 11

These two countries adopted reforms that liberalized their economies during the 1960s and they eventually became two of the world's freest economies. The two economies are

Accepted Answer

Hong Kong and Singapore adopted economic reforms in the 1960s that led to significant liberalization, transforming them into two of the world's freest economies.

Question 12

Which of the following adopted reforms that have substantially improved their economic freedom rating since 1980?

Accepted Answer

Ireland adopted significant economic reforms in the late 20th century, including reducing taxes, deregulating industries, and encouraging foreign investment, which improved its economic freedom rating.

Question 13

Which of the following is one of the reasons to believe that institutional change is more likely now than in the past?

Accepted Answer

All three options provided are valid reasons to believe that institutional change is more likely now than in the past. Countries are no longer under colonial rule and can make their own choices regarding institutions, the collapse of communism has opened up new opportunities for change, and advancements in transportation and communication have made institutions and policies more important than ever before. Therefore, it is safe to say that all of the above options are true.

Question 14

Which of the following adopted reforms that have substantially improved their economic freedom rating since 1980?

Accepted Answer

All of the above countries have adopted significant economic reforms since 1980, leading to improvements in their economic freedom ratings.

Question 15

According to the Economic Freedom of the World measure, the United States was

Accepted Answer

During the 1980-2000 period, the United States was consistently ranked as one of the freest economies in the world, typically behind Hong Kong and Singapore, according to the Economic Freedom of the World measure.

Question 16

Which of the following helps low income countries grow rapidly relative to high income countries?

Accepted Answer

Low income countries can benefit from the knowledge and techniques of high income countries, allowing them to achieve growth more quickly. However, the other options do not necessarily contribute to rapid economic growth. While saving a larger share of income is important for investment, high income countries may have more resources available to them for investment. Legal systems that protect property rights and enforce contracts can improve economic stability and encourage investment, but this does not necessarily lead to rapid economic growth. Favorable weather can be beneficial for certain industries, but it does not necessarily result in overall rapid economic growth.

Question 17

Which of the following most accurately states the importance of technology as a source of economic growth for less-developed countries?

Accepted Answer

The answer of Which of the following most accurately states...

Question 18

Which of the following is true of modern technology?

Accepted Answer

All of the options are true regarding modern technology. Option A states that improvements in technology have led to the production possibilities and living standards of people in several parts of the world. Option B suggests that low-income countries can emulate proven technologies at a low cost. Option C highlights that perverse institutions and policies can undermine the gains from improvements in technology.

Question 19

According to the Economic Freedom of the World measure, between 2000 and 2010 the economic freedom of the United States

Accepted Answer

The economic freedom of the United States declined between 2000 and 2010, and its rank fell from third to tenth during this period.

Question 20

Which of the following provides the best explanation of why low-income countries generally remain poor?

Accepted Answer

Institutional arrangements and policies that discourage productive activity and reduce potential gains from specialization and exchange are a major obstacle for low-income countries to escape poverty. Access to education, healthcare, and financial services are often limited, and corruption can be a widespread issue. Additionally, high levels of debt and dependency on foreign aid can constrain economic growth. These factors contribute to a cycle of poverty that is difficult to break.

Quiz 17: Institutions, Policies, and Cross-Country Differences in Income and Growth

The rapid growth rates of less developed countries (LDCs) after adopting institutions and policies more favorable to economic freedom and voluntary exchange is not surprising when one considers that

Researchers have found that countries that were settled by Europeans who planned on staying permanently were

The Economic Freedom of the World measure indicates that the United States

Which of the following is true of technology?

Which countries undertook economic reforms in the 1960's that resulted in more economic freedom and stronger economic growth?

Which of the following countries have instituted liberal reforms and substantially improved their economic freedom rating since 1990?

Which of the following countries began liberal economic reforms during the 1980s and now have significantly more economic freedom than during the mid-1980s?

Which of the following countries began economic liberalization in the 1970s and have achieved an impressive record of economic growth since that time?

During the 2000-2009 decade,

These two countries adopted reforms that liberalized their economies during the 1960s and they eventually became two of the world's freest economies. The two economies are

Which of the following adopted reforms that have substantially improved their economic freedom rating since 1980?

Which of the following is one of the reasons to believe that institutional change is more likely now than in the past?

Which of the following adopted reforms that have substantially improved their economic freedom rating since 1980?

According to the Economic Freedom of the World measure, the United States was

Which of the following helps low income countries grow rapidly relative to high income countries?

Which of the following most accurately states the importance of technology as a source of economic growth for less-developed countries?

Which of the following is true of modern technology?

According to the Economic Freedom of the World measure, between 2000 and 2010 the economic freedom of the United States

Which of the following provides the best explanation of why low-income countries generally remain poor?