Explain the Resource Curse and the Negative Outcomes That Might

question 5

Essay

Explain the resource curse and the negative outcomes that might be experienced by a country rich in natural resources.

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Definitions:

Liquid Assets

Assets that can be quickly converted into cash with little impact on their value.

Consumption Rate

The proportion of income or resources that is spent on consumption rather than saving.

Savings Rate

The proportion of disposable income that is saved rather than spent on consumption, typically expressed as a percentage.

Credit Cards

Financial instruments issued by banks or financial institutions that allow cardholders to borrow funds with which to pay for goods and services with the obligation to pay back the borrowed money, plus any applicable interest.