During 1990–2003, as a percentage of total resource flows to developing countries, the share of official flows has
(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
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Critics of the Keynesian view argue that increases in government spending financed by borrowing will hamper the recovery from a recession and slow long term growth because
a. more spending and debt will lead to higher future taxes to cover the cost of government and the interest on the debt. b. government spending is directed by political forces, rather than efficient cost-revenue comparisons. c. more political spending will lead to more wasteful rent-seeking activities and less production of goods and services that people value. d. All of the above are true.
Currently, China and India are growing much faster than the United States and Western Europe. This high rate of growth will eventually and naturally slow down in the future because:
a. China and India will exhaust their natural resources. b. Actually, there is no economic reason for China and India's growth rates to fall in the future. c. Current account surpluses will eventually cause capital flight from these nations which will lower the value of their currency and reduce their growth rates. d. Consumption will increase and crowd out investment spending. e. Diminishing returns will eventually set in.
In China, many farmers have switched from producing rice to producing vegetables and fruit because they can earn a great deal more money from these specialty crops. Within China, there are some who applaud this change, but others worry that China soon may become dependent on rice imports. Even with the low cost of Chinese labor, does the fact that China is importing rice suggest that other countries now have a comparative advantage in rice production?
A. Yes, but only if there are other countries with even cheaper labor. B. Yes, countries with more expensive labor can offset that cost with abundant land and farm equipment. C. Maybe, because rice is a standardized product, the role of innovation and creativity in its production is important. D. No, China must have a comparative advantage in rice if it imports rice.