Test Prep For AP® Courses
Which of the following is an economic growth policy most appropriate for a high-income country?
- establishing the rule of law
- protecting property rights
- investing in new infrastructure projects
- investing in technological innovations
- increasing private savings rates
What is one reason why unemployment rates differ among high- vs. low- and middle-income countries?
- High-income countries spend less on unemployment insurance, increasing their unemployment rate.
- Low- and middle-income countries benefit from a large pool of unskilled labor, keeping unemployment low.
- Low-income countries have a lot of informal employment in farming and fishing, masking the true—higher—unemployment rate relative to high-income countries.
- High-income countries have banned unions in attempts to keep unemployment higher.
- High-income countries have workers who cannot afford to lose their job and thus unemployment is lower there, whereas joblessness is not a crucial issue in middle- and low-income countries.
Foreign corporations with U.S. dollar-denominated loans are most likely going to suffer from which of the following events?
- high inflation in the United States
- an appreciation of the dollar
- high interest rates in the foreign country
- regulation of U.S. banks
- an increase in the budget deficit in the foreign country