The World Bank provides a cheaper funding source for developing countries as most developing countries:
A)have to repay the amount without the WB making adjustments for the rise in inflation.
B)do not have to furnish any guarantee of repayment to avail the WB loans.
C)do not have to pay any interest on the loans disbursed by the WB.
D)have considerably low credit ratings.
E)cannot avail loans from any institution apart from the World Bank.

Question

Quizplus · Accepted Answer

Developing countries generally have lower credit ratings due to factors such as political instability, economic volatility, and weak institutions. The World Bank provides a cheaper funding source for these countries despite their low credit ratings. However, repayment of the loans is required with interest. The World Bank may also make adjustments for inflation. Developing countries may have to furnish some form of guarantee of repayment depending on the specific loan program. Overall, while the World Bank does provide a cheaper funding source, it is not interest-free and may still involve some level of risk for both the borrower and the lender.

The World Bank Provides a Cheaper Funding Source for Developing