In Developing Countries, It Is Not True That

question 51

Multiple Choice

In developing countries, it is not true that

• A)banks are often viewed with suspicion
• B)at the first sign of economic problems, many bank depositors withdraw their funds
• C)because banks cannot rely on a continuous supply of deposits, banks cannot make loans for extended periods
• D)if financial institutions fail to serve as intermediaries between savers and borrowers, the lack of funds for investment will make growth rates double
• E)the credit provided by banks as a percent of total output is one fifth that in high-income countries

---

Definitions:

Least Costly Way

The most efficient method of achieving a desired outcome or producing a good or service, minimizing expenses while meeting specified objectives.

Economic Efficiency

A condition where resources are allocated in a way that maximizes the net benefit to society.

Runs Out

A situation where a supply or quantity of something is completely used up or exhausted.

Next Century

A future period of 100 years, used to forecast or plan long-term visions or developments.