Economic Development and Measures of Development Quiz

What is the main difference between economic growth and economic development?

• Economic growth is an increase in the size of a country's GDP, while economic development involves making value judgements about what represents a more developed economy.

• Economic growth is related to economic power internationally, while economic development is related to low levels of productivity.

• Economic growth depends on the health of the population, while economic development is represented by an outward shift in a country's PPF.

• Economic growth is a normative concept, while economic development is relatively easy to define.

What are the benefits of using national income data (GDP per capita and GNI per capita) as a measure of economic development?

• Takes distribution of income into account, and does not consider the informal economy

• Does not take quality of life factors into account, and does not consider the informal economy

• Takes quality of life factors into account, and considers the informal economy

• Indication of standards of living, and allows useful comparison between countries

What are the characteristics of developing countries?

• High population growth, incomplete markets, and low economic power internationally

• High levels of productivity, high unemployment, and low levels of savings

• Low standards of living, low levels of productivity, and high levels of savings

• High levels of productivity, low population growth, and complete markets

How is the Human Development Index (HDI) calculated?

• By using a weighted average of the three dimensions indices with more weight given to health

• By using a simple average of the three dimensions indices with more weight given to education

• By using a geometric mean of the three dimensions indices with equal weight given to all three dimensions

• By using a weighted average of the three dimensions indices with more weight given to living standards

What is the purpose of the Inequality Adjusted HDI (IHDI)?

• To give a more comprehensive measure of economic development than HDI or MPI

• To consider not only the average achievements of a country, but also how those achievements are distributed among its population

• To capture the severe deprivations that each person faces at the same time with respect to education, health and living standards

• To create a comprehensive picture of people living in poverty, and permit comparisons both across countries and within countries

What is the Genuine Progress Indicator (GPI) used for?

• To consider not only the average achievements of a country, but also how those achievements are distributed among its population

• To capture an indication of economic sustainability and give a more comprehensive measure of economic development

• To give a more comprehensive measure of economic development than HDI or MPI

• To create a comprehensive picture of people living in poverty, and permit comparisons both across countries and within countries

What are the limitations of using the HDI to compare levels of development between countries and over time?

• All of the above

• The index does not capture many aspects of life that people value and have reason to value

• The index is too narrow and should be expanded to include dimensions ranging from gender equality to biodiversity

• Important data restraints currently prevent many desirable additional dimensions from being incorporated

What is the main purpose of the Multidimensional Poverty Index (MPI)?

• To conceal disparities in human development across the population within the same country

• To capture an indication of economic sustainability and give a more comprehensive measure of economic development

• To consider not only the average achievements of a country, but also how those achievements are distributed among its population

• To complement traditional income-based poverty measures by capturing the severe deprivations that each person faces at the same time with respect to education, health and living standards

What is the difference between economic growth and development?

• Economic growth depends on the health of the population, while development is represented by an outward shift in a country's PPF

• Economic growth is a normative concept, while development is relatively easy to define

• Economic growth is an increase in the size of a country's GDP, while development involves making value judgements about what represents a more developed economy

• Economic growth is related to economic power internationally, while development is related to low levels of productivity

What is the main advantage of using the Human Development Index (HDI) to compare levels of development between countries and over time?

• It emphasizes that people and their capabilities should be the ultimate criteria for assessing the development of a country

• It considers not only the average achievements of a country, but also how those achievements are distributed among its population

• It captures an indication of economic sustainability and gives a more comprehensive measure of economic development

• It conceals disparities in human development across the population within the same country