The "Vicious Circle of Poverty" for Developing Nations Can Best

question 169

Multiple Choice

The "vicious circle of poverty" for developing nations can best be described by

• A)low levels of international trade that reduce exports and increase the dependence on imports.
• B)low incomes that inhibit saving and the accumulation of real and human capital, making it difficult to increase productivity and income.
• C)a large government sector, which reduces the availability of private investment spending but increases macroeconomic stability.
• D)a lack of entrepreneurial talent that limits the formation of businesses and the development of private businesses.

---

Definitions:

Book Value

The value of a company's assets minus its liabilities, as recorded on the balance sheet.