What impact does high inequality have on economic growth?
It promotes growth by rewarding those at the top of the income hierarchy
It leads to damaging recessions
It has no impact on growth
It adversely affects the sustainability of growth
Top-income data best reflects:
The power of people with the largest incomes
The biggest benefit of democracy
An ethical distribution of wealth
The same information as the GINI index
Which of the following is true about the current account:
If it is positive, a country exports more than it imports
If it is negative, a country exports more than it imports
If it is positive, a country is necessarily better off
If it is negative, a country has a large trade surplus
High youth unemployment can lead to:
Inactivity of extremist groups
Lower levels of students attending universities
Greater income equality
Countries interested in joining the EU must demonstrate all but which of the following economic criteria?
Sustainable public finances.
Exchange rate stability.
Predictable short-term interest rates.
The term Keiretsu refers to:
A business model organized in Germany after the way
The three centres of power in Japan – bureaucracy, politicians and big business
A period of stagnation in the Japanese economy
Cross-shareholdings and informal networks of suppliers and customers
Transition economies typically seek all but which of the following to grow?
Foreign investors willing to develop new start-up enterprises
Foreign investors willing to purchase state enterprises transitioning to private companies
Foreign and local investment for infrastructure.
Foreign government loans
Which of the following was not used to help Sweden emerge from the 1991 financial crisis?
Privatization of healthcare
Increase in taxes
Privatization of education
Reduced welfare spending
A current account surplus indicates which of the following?
The country exports more than it imports
The country imports more than it exports
The country’s exports are too expensive
The country’s imports are too expensive
Assessing income inequality is most accurately accomplished by?
Examining in detail top-income data for longevity factors.
Identifying sources of poverty.
Assessing export growth over time.
Exploring trend lines in per capita GNI and GDP.
1. Option D
Economies with pronounced economic inequality suffer from lower long-term GDP growth rates, higher crime rates, poorer public health, increased political inequality, and lower average education levels
2. Option A
Top income data reflects those who are best. It reflects powerful people earning highest income.
Surpluses tend to be reported as “good” or “healthy”, while deficits are often regarded as “bad”. When a country has a current account surplus, it is exporting capital to the rest of the world. Consequently, it is a net lender.
Areas of high unemployment especially youth unemployment tend to have more crime and vandalism. It can lead to alienation and difficulties in integrating young unemployed people into society.All this can result in political unrest.
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