Chapter 14 : Foreign Aid
MULTIPLE CHOICE
1. When the U.S. government provides a grant to build an electricity generator:
a.
it counts as foreign aid.
b.
it does not count as foreign aid.
c.
it depends; sometimes it counts as foreign aid.
d.
it counts as private assistance.
2. When Citibank provides a commercial loan to build an electricity generator:
a.
it counts as foreign aid.
b.
it does not count as foreign aid.
c.
it depends; sometimes it counts as foreign aid.
d.
it counts as private assistance.
3. A loan counts as aid if it has a grant element of at least:
a.
10 percent.
b.
25 percent.
c.
50 percent.
d.
none of the above; it never counts as a grant.
4. When the U. S. government provides a grant to purchase military equipment:
a.
it counts as foreign aid.
b.
it does not count as foreign aid.
c.
it depends; sometimes it counts as foreign aid.
d.
it counts as private assistance.
5. Most aid has been given:
a.
bilaterally.
c.
through private organizations.
b.
multilaterally.
d.
through individuals.
6. In terms of total amount, which country gives the most aid?
a.
United States
c.
United Kingdom
b.
Japan
d.
Norway
MSC: Factual
7. Surveys indicate that the U.S. public believes the United States spends how much of its budget on aid?
a.
1 percent
c.
10 percent
b.
5 percent
d.
20 percent
8. In terms of aid as a percentage of GNI, which country gives the most aid?
a.
United States
c.
United Kingdom
b.
Japan
d.
Sweden
9. Primarily, the World Bank provides:
a.
foreign aid.
b.
loans to middle-income countries at market rates.
c.
investment in private companies.
d.
settlement of international disputes.
10. True or False: Being a former colony substantially increases the probability of receiving aid flows.
a.
True
b.
False
c.
True only for former colonies of Great Britain
d.
True only for older colonies
11. Beginning in 2002, which country became the largest aid recipient in the world?
a.
Iraq
c.
Vietnam
b.
Iran
d.
India
12. Aid falls to about 50 percent of its peak level after:
a.
6 years.
c.
18 years.
b.
12 years.
d.
24 years.
13. As aid increases, GDP growth:
a.
increases.
b.
decreases.
c.
stays the same.
d.
none of the above; there is no definite relationship between the two.
14. A study on the flypaper effect in Indonesia revealed that aid:
a.
crowded out government spending.
c.
was neutral to government spending.
b.
crowded in government spending.
d.
was harmful to government spending.
15. Aid has helped in all of the following areas except:
a.
health.
c.
emergency assistance.
b.
education.
d.
stimulating tax revenue.
SHORT ANSWER
IDs and Paired-Concept Questions
These terms can be used individually as short-answer identification questions, or they can be used in
pairs. In the latter case, ask students to explain (1) the meaning and significance of each of the two
terms and (2) the relationship between them.
1. Official development assistance (ODA), Development Assistance Committee (DAC)
ANS:
Answer will vary
2. Foreign aid, nonconcessional assistance
ANS:
Answer will vary
3. Bilateral assistance, multilateral assistance
ANS:
Answer will vary
4. Commitment to development index, foreign aid
ANS:
Answer will vary
5. Iraq, motivations for aid
ANS:
Answer will vary
6. Aid, growth
ANS:
Answer will vary
7. Flypaper effect, government spending
ANS:
Answer will vary
8. Absorptive capacity, aid
ANS:
Answer will vary
9. Aid dependency, aid agencies
ANS:
Answer will vary
10. Future of aid, recipient participation
ANS:
Answer will vary