Chapter 7

07.01 Which of these factors is involved in the international movement of money and financial securities? 1. U.S. trade deficit 2. oil money 3. bank secrecy laws 4. laundered money 5. all of the above

07.01 Which of these factors is involved in the international movement of money and financial securities? 1. U.S. trade deficit 2. oil money 3. bank secrecy laws 4. laundered money 5. all of the above Explanation: All of the above are factors in the international geography of finance, in which money moves around the globe in search of greater profits from investments.

07.02 Which of these is an example of a very low income country? 1. South Korea 2. South Africa 3. Saudi Arabia 4. Ethiopia 5. all of the above

07.02 Which of these is an example of a very low income country? 1. South Korea 2. South Africa 3. Saudi Arabia 4. Ethiopia 5. all of the above

07.03 Cost advantages that accrue to individual firms because of their location among functionally related activities are called: 1. agglomeration effects 2. agglomeration diseconomies 3. ancillary activities 4. backwash effects 5. autarky

07.03 Cost advantages that accrue to individual firms because of their location among functionally related activities are called: 1. agglomeration effects 2. agglomeration diseconomies 3. ancillary activities 4. backwash effects 5. autarky Explanation: When firms cluster geographically, they can take advantage of the proximity of related activities. Silicon Valley, in California, is an example of agglomeration effects, with hardware, software, and research firms all located near each other; these firms can benefit from the availability of each other’s products and services.

07.04 The gap between the world’s rich and poor: 1. is decreasing steadily 2. is increasing steadily 3. is staying the same 4. has increased, but is now decreasing 5. has decreased, but is now increasing

07.04 The gap between the world’s rich and poor: 1. is decreasing steadily 2. is increasing steadily 3. is staying the same 4. has increased, but is now decreasing 5. has decreased, but is now increasing

07.05 In which of these regions is a very high percentage of the population engaged in agriculture, forestry, and fishing? 1. South America 2. Africa 3. Australia 4. Europe 5. Middle East

07.05 In which of these regions is a very high percentage of the population engaged in agriculture, forestry, and fishing? 1. South America 2. Africa 3. Australia 4. Europe 5. Middle East

07.06 The situation in which countries have to constantly borrow money in order to finance development is known as: 1. monetarism 2. autarky 3. inflation 4. debt trap 5. backwash effects

07.06 The situation in which countries have to constantly borrow money in order to finance development is known as: 1. monetarism 2. autarky 3. inflation 4. debt trap 5. backwash effects Explanation: Some countries, such as Brazil, have had to borrow more money to finance development as well as meet interest payments on existing debt.

07.07 Which of these is not an example of an offshore financial center? 1. Hawaii 2. Panama 3. Cayman Islands 4. Bahrain 5. Nauru

07.07 Which of these is not an example of an offshore financial center? 1. Hawaii 2. Panama 3. Cayman Islands 4. Bahrain 5. Nauru Explanation: Offshore financial centers are places that offer secrecy and shelter from taxation and regulation; they are not necessarily islands or “off shore.”

07.08 Which of these countries has a very low index of gender empowerment? 1. Canada 2. Australia 3. Saudi Arabia 4. Japan 5. Peru

07.08 Which of these countries has a very low index of gender empowerment? 1. Canada 2. Australia 3. Saudi Arabia 4. Japan 5. Peru Explanation: The gender empowerment index measures women’s participation in a society and how their wages compare with those of men.

07.09 The final stage in W. W. Rostow’s stages of growth model is: 1. traditional society 2. preconditions for take-off 3. take-off 4. drive to maturity 5. high mass consumption

07.09 The final stage in W. W. Rostow’s stages of growth model is: 1. traditional society 2. preconditions for take-off 3. take-off 4. drive to maturity 5. high mass consumption

07.10 Which of these countries gives the lowest percentage of its Gross National Income (GNI) to poorer countries as international development assistance? 1. Norway 2. United States 3. Ireland 4. Australia 5. Spain

07.10 Which of these countries gives the lowest percentage of its Gross National Income (GNI) to poorer countries as international development assistance? 1. Norway 2. United States 3. Ireland 4. Australia 5. Spain Explanation: The United States, while giving the largest amount in absolute dollars, gives only 0.15 percent of its GNI as development assistance. All of the other countries listed here give 0.23 percent or more, with Norway giving as much as 0.92 percent.

07.11 In which of these cities does the vast majority of European advertising agencies congregate? 1. Paris 2. London 3. Frankfurt 4. Amsterdam 5. Zurich

07.11 In which of these cities does the vast majority of European advertising agencies congregate? 1. Paris 2. London 3. Frankfurt 4. Amsterdam 5. Zurich

07.12 The idea of carrying capacity is best described by: 1. the maximum number of sheep that can graze on a field 2. the human pressures from irrigation in a desert 3. the number of potential people that can be born in a country 4. the number of acres there are in a forest 5. all of the above

07.12 The idea of carrying capacity is best described by: 1. the maximum number of sheep that can graze on a field 2. the human pressures from irrigation in a desert 3. the number of potential people that can be born in a country 4. the number of acres there are in a forest 5. all of the above Explanation: Carrying capacity is the maximum population that can be maintained in a place without damaging long-term productivity.

07.13 Maquiladoras are manufacturing plants that are located in which region? 1. in coastal areas of Brazil 2. in Mexico near the U.S. border 3. in central Mexico 4. in states such as Texas and California 5. in Caribbean islands

07.13 Maquiladoras are manufacturing plants that are located in which region? 1. in coastal areas of Brazil 2. in Mexico near the U.S. border 3. in central Mexico 4. in states such as Texas and California 5. in Caribbean islands