Economics of development-mostly lewis model questions

Total poverty gap is a measure of

1. The depth of poverty
2. Per capita income of individuals below the poverty line
3. İncome equality
4. Number of individuals below the poverty line.

The only factor that can contribute to increasing output per capita in the long run in the solow model is

1. An increase in the savings rate
2. An increase in the rate of growth of population
3. A decrease in the rate of depreciation
4. An improvement in technology

Coordination failure leads to an inferior equilibrium because

1. individuals do not optimize responses to actions of others
2. actions are complementary
3. actions are complementary and there is lack of consorted effort
4. individuals are not aware of a possible superiro equilibrium

using natural logs for GNP(PPP) in the calculation of the income index in the HDI,satisfies

1. all of the other options
2. the requirement of comparison of living standards across economies
3. the requirement of comparison of GDPs across economies
4. the assumption of diminishing marginal utility of income

Capital accumulation in the manufacturing sector in the lewis model might not be employment generating if

1. capital stock embodies labor saving technical progress
2. any one of the other options
3. technical progress is neutral
4. there exists a capital saving technical progress

The lewis model provides an illustration of the mechanism through which the savings rate in an economy increases by

1. generating higher levels of GDp
2. diverting income towards the capitalists
3. both by” diverting income towards the capitalists” and “generating greater surpluses”
4. generating greater surpluses

the distance between the 45 degree line and the lorenz curve denotes

1. the extent to which each quantile falls short of the share of national income required to achieve perfect equality
2. both “ the extent to which each quintile falls short of the share of national income required to achieve perfect equality “ and “the gini-coefficient”
3. the extent to which each quantile is close to achieving perfect equality
4. the gini-coefficient

In the lewis model, the supply curve of labor in the manufacturing sector, is infinitely elastic

1. because labor can be continuously be derived from the agricultural sector without having to raise wages
2. all of the other options
3. as long as there exists a pool of surplus labor in the agricultural sector
4. because the wage in the agricultura is constant.

In the lewis model, the subsistence wage in the agricultura  sector is determined to equal the average product of labor because

1. all of the other options
2. the agricultural sector is not assumed to be a profit making sector
3. there exists a unlimited pool of surplus labor
4. marginal product of labor is zero

what is the unit measurement used to measure the income index in the new HDI?

1. Any one of the other options
2. There is no unit of measurement
3. Local currency units
4. Dollar

Technological spillover refers to

1. Unintentional technological benefits derived in the form of increased output
2. The increased use of capital in production
3. The improvement of technology used in production purposes
4. All of the other options

The big push model, illustrates complementarity between production decisions of modern firms

1. Taken before they enter the market
2. Both “taken after they have entered the market” and “ taken independently”
3. Taken independently
4. Taken after they have entered the market

GNP is GDP

1. Plus net factor incomes earned abroad
2. Both “plus net factor incomes earned abroad” and “plus incomes sent back home by nationals living abroad minus incomes sent out by foreign nationals living in this country”.
3. Minus net factor incomes earned abroad
4. plus incomes sent back home by nationals living abroad minus incomes sent out by foreign nationals living in this country”.

In the manufacturing sector in the lewis model,

As long as the wage rate remains constant, capital accumulation leads to

1. both “ a rise in the share of wages” and “ a fall in the share of profits”
2. a fall in the share of wages
3. a fall in the share of profits
4. a rise in the share of wages