Economics MCQs

Page No. 367

Initial conditions in the year before the crisis in Thailand Indonesia Malaysia the Philippines and Korea in 1997 indicate that ? 0 i. capital inflows/GDP were very low ii. Nonperforming bank loan ratios were high iii. current account deficits were high iv. credit growth was fast


aI and IV only


bII and III only


cI, II and III only


dII, III and IV only


View Answer II, III and IV only

Which of the following country was not a major LDC debtor in 2001 ?


aBrazil


bArgentina


cThailand


dMalaysia


View Answer Malaysia

The debt-service ratio is the______________?


along-term debt divided by GDP of a country in a given year


b interest and principle payments divided by exports of goods and services


cratio of debt net of portfolio investment financing and foreign direct investment


ddefault and reschedule debt minus annual export revenues that must be devoted to paying interest



Which of the following is will NOT reduce capital flight from source countries ?


a dependable positive real interest rates


bhigher taxes on capital gains


c more efficient state enterprises


dmarket liberalization



Which of the following is Not true about external debt ?


aExternal debt accumulates with international balance on goods services and income deficcits


bWhen debts are denominated in U.S dollars their appreciation during the 1990s increased the cost of servicing such debts


cIn the 19901s LDCs relied increasingly on aid from DCs


dInternational lenders required LDC governments to guarantee private debt



In 1990, during the Persian Gulf War, the U.S government extended generous terms to two middle-income countries by canceling or reducing their debt The two countries were ?


aIraq and Iran


bEgypt and Poland


cPakistan and Afghanistan


dSaudi Arabia and Jordan


View Answer Egypt and Poland

Highly-indebted poor countries (HIPCs) include________________? I- Bolivia II- Benin III- Uganda IV- Tanzania


a I and II only


bI, II , III only


cI, III and IV only


d I, II , III and IV


View Answer I, II , III and IV

The policy cartel on debt reduction refers to the_______________?


ascreening of debtors based on their regional location


bWorld Bank requiring LDCs seconded by a DC to get loan reduction


cloan denial to crisis-stricken highly indebted countries


dNone of the above


View Answer None of the above

Mosley Harrigan and Toye refer to the IMF and World Bank as________________?


aexcessively committed to writing down LDC debt


b a managed duopoly of policy advice


c a U.S monoply


d the initiator of HIPCs debt forgiveness



Fundamentalists want the IMF to lend to crisis-stricken countries on condition that they undertake fundamental structural reforms in banking Joseph Stiglitz however thinks it is______________?


a unrealistic for IMF to intervene in the financial markets of poor countries during the crisis


b impractical for the IMF to loan short term as reforms can only be effective in the middle to long run


ccrucial that the IMF intervene in the reform of fiscal policy of the country and not the monetary policy


dNone of the statements above is correct



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