01
Choose one
1 point
A country allows private firms to compete, but the government regulates markets, funds social insurance, and owns several strategic utilities. Which description best fits this economy?
Free Practice Quiz Question List
Political Economy and Development Online Quiz Questions
Use this free practice quiz with 20 questions to review Political Economy and Development, test your knowledge, and prepare for your next test or exam.
20 questions
02
True or false
1 point
True or false: A country can experience rising GDP while still having serious problems involving inequality, environmental damage, or access to health care.
- A
True
- B
False
03
Choose one
1 point
Which situation best illustrates policy feedback?
- A
A policy is implemented without affecting any political group.
- B
A policy automatically produces the same result in every country.
- C
A policy changes political interests and coalitions over time.
- D
A policy is evaluated only by measuring its immediate budgetary cost.
04
Choose one
1 point
A government protects property rights, enforces contracts, and provides infrastructure, while most firms and households decide what to buy and produce in response to prices. Which economic arrangement is most consistent with this description?
- A
The state sets all production targets and distributes every product.
- B
Private firms and households respond to prices and competition while the government enforces contracts and provides public goods.
- C
Regional governments prohibit private ownership but allow household barter.
- D
A central authority allocates credit and labor without using market exchange.
05
Choose all
1 point
Select all the institutional features that can directly support economic development according to the material.
- A
Secure property rights can encourage investment.
- B
Formal constitutional structures always guarantee equal access to justice.
- C
Predictable legal procedures can make contracts more credible.
- D
Effective state capacity can support taxation and public services.
06
Choose all
1 point
A government wants to preserve the political sustainability of globalization while helping people harmed by import competition. Select all the policies that represent compensation.
- A
Expanded unemployment insurance for workers displaced by imports.
- B
Regional investment in communities experiencing industrial decline.
- C
Higher tariffs on imported goods.
- D
Education and retraining programs for affected workers.
07
True or false
1 point
True or false: If a country's Gini coefficient rises substantially while all other information is unavailable, the safest interpretation is that measured income inequality has increased.
- A
True
- B
False
08
True or false
1 point
True or false: Vaccination can create a positive externality because benefits may extend to people other than the person receiving the vaccine.
- A
True
- B
False
09
Written response
1 point
A wealthy industry uses concentrated economic power to shape regulations and public decisions mainly for its own benefit. What is the two-word term for this process?
10
Written response
1 point
What term describes differences among households in accumulated assets such as land, housing, businesses, and financial holdings?
11
Fill in the blank
1 point
Complete the statement: A tax takes a larger percentage of income from .
12
Fill in the blank
1 point
Complete the statement: National defense is an example of a , while pollution from a factory is an .
13
Open ended
1 point
Explain why economic policy is inherently political. Use two different policy examples from the material and show how each can distribute benefits or costs and influence later political coalitions or government legitimacy.
14
Choose one
1 point
Which statement best explains how global value chains can promote development while also creating distributional conflict?
- A
They require every stage of production to occur within one country and prevent international specialization.
- B
They divide production among countries, enabling specialization, lower costs, technology transfer, and market access, while potentially causing job losses, wage pressure, or regional decline for workers and regions exposed to import competition.
- C
They ensure that every country and worker receives an equal share of the gains from international production.
- D
They eliminate the need for domestic policies to support workers and regions affected by economic change.
15
Choose one
1 point
Which description best fits a mixed economy?
- A
An economy in which all production decisions are made through voluntary exchange and prices
- B
An economy that combines private markets with government ownership, regulation, redistribution, and social programs
- C
An economy in which the government owns every firm and prohibits private enterprise
- D
An economy that avoids both markets and government planning
16
Choose one
1 point
Why do secure property rights generally support economic development?
- A
They guarantee that every investment will produce a profit
- B
They eliminate the need for courts and contract enforcement
- C
They encourage investment by making ownership more secure and predictable
- D
They allow governments to set all private investment decisions
17
Choose one
1 point
A country’s GDP per capita rises, but access to health care remains highly unequal and environmental damage increases. What is the most accurate conclusion?
- A
It provides a rough average of material resources but does not fully measure human development
- B
It directly measures the distribution of wealth and political freedom
- C
It includes unpaid household labor and environmental damage by definition
- D
It measures the quality of institutions more accurately than economic output
18
Choose one
1 point
Which tax design is progressive?
- A
Every taxpayer pays the same fixed amount regardless of income
- B
Lower-income taxpayers pay a larger percentage of income than higher-income taxpayers
- C
Taxpayers pay only when they receive a government transfer
- D
Higher-income taxpayers pay a larger percentage of income than lower-income taxpayers
19
Written response
1 point
Services represented 27.5% of global trade. Assuming the remainder was trade in goods, what percentage-point share did goods represent?
20
Written response
1 point
What standard two-word term describes the possibility that abundant oil, gas, or mineral resources can be associated with corruption, weak economic diversification, conflict, or authoritarian politics rather than broad-based development?