Question 1

Countries in the "traditional society" stage of economic development are characterized by an economic structure that is dominated by technology.

Accepted Answer

Countries in the "traditional society" stage of economic development are characterized by an economic structure that is dominated by agriculture.

Question 2

Under communism, all means of production and private property are under state ownership and/or cooperative ownership.

Accepted Answer

Under communism, all means of production and private property are under state ownership and/or cooperative ownership. The state is in charge of allocation of resources to sectors as needed and to individuals (goods and services) according to their needs. This is stated in the "Alternative Models of Economic Development: The Marxist-Leninist (Maoist) Model" section (2-2b).

Question 3

The Marxist-Leninist (Maoist) model competes with market-oriented capitalist philosophies.

Accepted Answer

The Marxist-Leninist (Maoist) model competes with market-oriented capitalist philosophies. It fuels anticolonial and anti-imperialist sentiments This is stated in the "Alternative Models of Economic Development: The Marxist-Leninist (Maoist) Model" section (2-2b).

Question 4

Historically, the informal and frequently used classification in the West has referred to highly industrialized, high-income countries as the First World, to Islamic countries as the Second World, and to developing countries as the Third World.

Accepted Answer

Historically, the informal and frequently used classification in the West has referred to highly industrialized, developed countries as the First World, to socialist countries as the Second World, and to developing countries as the Third World.

Question 5

China is currently in the communist stage of development.

Accepted Answer

No country has ever claimed to have reached the communist stage. This is stated in the "Alternative Models of Economic Development: The Marxist-Leninist (Maoist) Model" section (2-2b).

Question 6

In contrast to high-income countries, low-income countries do not present opportunities for firms operating in the areas of infrastructure development.

Accepted Answer

Low-income countries do present opportunities for firms operating in the areas of infrastructure development. Moreover, low-income countries are the primary recipients of international development aid, which makes them even more attractive.

Question 7

The top 100 companies in the world control about 20 percent of foreign assets.

Accepted Answer

The top 100 companies in the world control about 20 percent of foreign assets, and employ 6 million workers, and account for as much as 7 percent of total world economic activity.

Question 8

A weak dollar makes American goods and services more competitive in foreign markets.

Accepted Answer

A weak dollar makes American goods and services more competitive in foreign markets, keeps jobs at home, and decreases the trade deficit because America's workers keep more production at home and sell more goods abroad.

Question 9

Firms from industrialized countries and their representative governments dominate the world economy by allocating resources worldwide based on local population needs.

Accepted Answer

In the current economic environment, firms from industrialized countries and their representative governments dominate the world economy, allocating resources worldwide based on market potential, rather than on local population needs, creating a growing gap between the have countries and have-not countries.

Question 10

More than half of the 100 biggest economies in the world are now corporations, not nations.

Accepted Answer

Multinational companies account for two-thirds of world trade, and many have economic weight: more than half of the 100 biggest economies in the world are now corporations, not nations.

Question 11

High-income countries are highly industrialized counties which have well developed industrial and service sectors.

Accepted Answer

In contrast to emerging countries and developing countries, high-income countries are highly industrialized counties which have well developed industrial and service sectors.

Question 12

High-income countries present challenges to international firms because their markets are the most competitive.

Accepted Answer

Although these countries present great potential because they have consumers with the highest per capita income, they also present challenges to international firms because their markets are in the maturity stage, consumers have established preferences, and competition is intense.

Question 13

According to the Rostow model, each stage of economic development is a function of productivity, economic exchange, technological improvements, and income.

Accepted Answer

The Rostow model of economic development is the Western model. In contrast to the Marxist model, the Rostow model states that each stage of economic development is a function of productivity, economic exchange, technological improvements, and income.

Question 14

Under older Western classification, socialist countries used to be referred to as Second World.

Accepted Answer

Historically, the informal and frequently used classification in the West has referred to highly industrialized, developed countries as the First World, to socialist countries as the Second World, and to developing countries as the Third Word. Of this classification, only the term "the Third World" has been used widely, and it is still being used, even after the fall of communism.

Question 15

The Rostow model is a competing alternative for developing nations seeking to avoid domination by advanced market capitalist economies.

Accepted Answer

The Marxist-Leninist (Maoist) model is a competing alternative for developing nations seeking to avoid domination by advanced market capitalist economies. This is stated in the "Alternative Models of Economic Development: The Marxist-Leninist (Maoist) Model" section (2-2b).

Question 16

Modern technology is fully adopted in all economic activity and new leading sectors emerge in the "drive to maturity" stage of the Rostow Modernization model.

Accepted Answer

Modern technology is fully adopted in all economic activity and new leading sectors emerge in the "drive to maturity" stage of the Rostow Modernization model. In the "take-off" stage, technology is not fully adopted. In the "high mass consumption" stage, the "leading sectors" have already emerged.

Question 17

The Marxist-Leninist (Maoist) model endorses a collective orientation, one adopted by the more traditional developing countries.

Accepted Answer

The Marxist-Leninist (Maoist) model endorses a collective orientation, one adopted by the more traditional developing countries, and competes with market-oriented capitalism, fueling anticolonial and anti-imperialist sentiments. This is stated in the "Alternative Models of Economic Development: The Marxist-Leninist (Maoist) Model" section (2-2b).

Question 18

Upper middle income countries have rapidly developing economies, and especially in urban areas, they have an infrastructure that is on par with that of developed countries.

Accepted Answer

Upper middle income countries have rapidly developing economies, and especially in urban areas, they have an infrastructure that is on par with that of developed countries. Among them are countries in Latin America, such as Argentina, Chile, and Mexico.

Question 19

The Marxist-Leninist model of economic development still constitutes a dominant development philosophy in some developing countries.

Accepted Answer

Although the Western model (i.e., Rostow model) of economic development is spreading, the Marxist-Leninist model is still prevalent in some developing countries. This is stated in the "Perspectives on Economic Development" section (2-2b).

Question 20

During "drive-to-maturity" stage of the Rostow Modernization model, growth becomes the norm and improvements in production lead to the emergence of leading sectors.

Accepted Answer

During "take-off" stage of the Rostow Modernization model, growth becomes the norm and improvements in production lead to the emergence of leading sectors. Income rises across the board, and a new class of established entrepreneurs emerges.

Quiz 2: An Overview of the International Marketing Environment