Q.1 What does 'development economics' primarily study?
Economic growth in developed nations
Policies for achieving sustainable growth in developing nations
Only agricultural productivity
Stock market investments
Explanation - Development economics focuses on the economic aspects of the development process in low-income countries, aiming at improving living standards.
Correct answer is: Policies for achieving sustainable growth in developing nations
Q.2 Which indicator is most commonly used to measure a country's standard of living?
Gross Domestic Product (GDP)
Human Development Index (HDI)
Balance of Payments
Inflation Rate
Explanation - HDI measures overall development by combining income, education, and life expectancy, making it a better measure of standard of living than GDP alone.
Correct answer is: Human Development Index (HDI)
Q.3 Which of the following is NOT a component of the Human Development Index (HDI)?
Life Expectancy
Education Level
Income per Capita
Inflation Rate
Explanation - HDI considers life expectancy, education, and income per capita. Inflation rate is not a direct part of HDI.
Correct answer is: Inflation Rate
Q.4 Sustainable development means:
Rapid industrial growth
Growth that meets present needs without compromising future generations
Exclusive focus on economic growth
Using resources as quickly as possible
Explanation - Sustainable development balances current needs with environmental protection and resource preservation for the future.
Correct answer is: Growth that meets present needs without compromising future generations
Q.5 Which organization publishes the World Development Report annually?
World Bank
IMF
UNESCO
OECD
Explanation - The World Bank publishes the World Development Report, which addresses key development issues each year.
Correct answer is: World Bank
Q.6 Which economist is known for the 'capability approach' in development economics?
Adam Smith
John Maynard Keynes
Amartya Sen
Milton Friedman
Explanation - Amartya Sen introduced the capability approach, emphasizing people's freedoms and opportunities rather than just income.
Correct answer is: Amartya Sen
Q.7 Foreign Direct Investment (FDI) refers to:
Money sent home by migrants
Investments made by a company in a foreign country
Loans given by IMF
Tourism earnings
Explanation - FDI occurs when a firm invests directly in facilities to produce or market a product in a foreign country.
Correct answer is: Investments made by a company in a foreign country
Q.8 Microfinance primarily aims to:
Provide large loans to governments
Provide small loans to poor households
Invest in stock markets
Finance multinational corporations
Explanation - Microfinance institutions give small loans to poor households, particularly women, to encourage self-employment and poverty reduction.
Correct answer is: Provide small loans to poor households
Q.9 Remittances are:
Government subsidies
Money sent by migrants to their home countries
Foreign loans
Corporate profits abroad
Explanation - Remittances are a significant source of foreign income for many developing countries, sent home by migrants working abroad.
Correct answer is: Money sent by migrants to their home countries
Q.10 Which of the following is an example of 'inclusive growth'?
Growth benefiting only the wealthy
Growth that reduces poverty and inequality
Growth with higher inflation
Growth focusing only on exports
Explanation - Inclusive growth ensures that the benefits of development are widely shared across society, especially with the poor.
Correct answer is: Growth that reduces poverty and inequality
Q.11 Which is a common challenge in developing economies?
High productivity
High unemployment and underemployment
Surplus infrastructure
Aging population
Explanation - Developing economies often face unemployment, underemployment, and informal labor markets.
Correct answer is: High unemployment and underemployment
Q.12 What does 'dual economy' mean?
Economy with two currencies
Economy with modern and traditional sectors coexisting
Economy that trades with two partners only
Economy with high inflation
Explanation - A dual economy refers to the coexistence of a modern industrial sector and a traditional agricultural sector within the same country.
Correct answer is: Economy with modern and traditional sectors coexisting
Q.13 Which is a long-term measure to reduce poverty?
Cash subsidies
Job training and education
Short-term food aid
Currency devaluation
Explanation - Improving education and skills helps people secure better jobs, reducing poverty sustainably.
Correct answer is: Job training and education
Q.14 The Millennium Development Goals (MDGs) were replaced by:
Human Rights Declaration
Sustainable Development Goals (SDGs)
Paris Climate Agreement
Doha Round
Explanation - In 2015, the MDGs were replaced by 17 SDGs that set a broader agenda for global development.
Correct answer is: Sustainable Development Goals (SDGs)
Q.15 Infrastructure development (like roads and electricity) is crucial in development economics because:
It increases unemployment
It slows down economic growth
It boosts productivity and reduces poverty
It causes inflation
Explanation - Better infrastructure supports industries, trade, and access to markets, raising productivity and reducing poverty.
Correct answer is: It boosts productivity and reduces poverty
Q.16 Which region has historically received the largest share of global foreign aid?
Latin America
South Asia
Sub-Saharan Africa
Eastern Europe
Explanation - Sub-Saharan Africa has been a major recipient of global foreign aid due to widespread poverty and development challenges.
Correct answer is: Sub-Saharan Africa
Q.17 Import substitution industrialization (ISI) is a strategy aimed at:
Promoting imports to boost competition
Replacing foreign imports with domestic production
Only exporting raw materials
Investing heavily in foreign markets
Explanation - ISI encourages local production to reduce dependency on imports and foster industrialization.
Correct answer is: Replacing foreign imports with domestic production
Q.18 The 'poverty trap' refers to:
The inability of rich countries to maintain wealth
A cycle where poverty leads to conditions that keep people poor
Government restrictions on trade
Inflation reducing incomes
Explanation - The poverty trap means people remain poor due to lack of education, resources, and opportunities.
Correct answer is: A cycle where poverty leads to conditions that keep people poor
Q.19 Which of these is considered a 'non-economic' factor in development?
Capital investment
Education
Industrial growth
Infrastructure
Explanation - Education is a social factor but is crucial for human capital development and overall growth.
Correct answer is: Education
Q.20 Who introduced the concept of 'Big Push' theory in development economics?
Ragnar Nurkse
Paul Rosenstein-Rodan
W.W. Rostow
Amartya Sen
Explanation - Rosenstein-Rodan argued that coordinated investment is necessary to overcome development bottlenecks.
Correct answer is: Paul Rosenstein-Rodan
Q.21 Which sector usually dominates in the early stages of economic development?
Services
Agriculture
Manufacturing
Technology
Explanation - In early development, agriculture is the largest sector before industrialization takes place.
Correct answer is: Agriculture
Q.22 Which global institution provides loans specifically for development projects?
World Bank
WTO
NATO
OPEC
Explanation - The World Bank lends money to developing countries for infrastructure and development projects.
Correct answer is: World Bank
Q.23 Which of these is a measure of income inequality?
Consumer Price Index
Gini Coefficient
Gross National Product
Unemployment Rate
Explanation - The Gini Coefficient measures income inequality within a country, ranging from 0 (perfect equality) to 1 (perfect inequality).
Correct answer is: Gini Coefficient
Q.24 The 'Lewis Model' of development focuses on:
Transition from agricultural to industrial economy
The role of government spending
Free market efficiency
Foreign trade imbalances
Explanation - Lewis explained development as a shift of labor from agriculture to industry, boosting productivity and growth.
Correct answer is: Transition from agricultural to industrial economy
Q.25 Official Development Assistance (ODA) is:
Private foreign investment
Loans and aid from developed to developing countries
Military funding
Domestic subsidies
Explanation - ODA refers to official aid and concessional loans given by developed countries to help developing nations.
Correct answer is: Loans and aid from developed to developing countries