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:

Usage Hours

A measure of the time that an asset is actively used in production or operations.

Activity Method

A depreciation method where the asset’s expense is based on its usage or activity level, rather than the passage of time.

Unit Cost

The cost incurred by a company to produce, store, and sell one unit of a particular product or service.

Declining-Balance Method

A method of calculating depreciation that results in larger depreciation charges in the early years of an asset's life and smaller charges later on.