Finance and Development Chapter 9

What approach to corporate governance did the country adopt?

Mandatory compliance with all code provisions
Voluntary disclosure of company situation
Forced compliance with OECD principles
Comply or explain approach (correct)

Why do traditional financial institutions often deny access to low-income individuals?

Because of the short repayment periods
Because of the high risk of lending
Because of the perceived risk or relatively low balances (correct)
Because of the high interest rates

What is a common characteristic of the income flows of the poor?

High, regular, and predictable
Low, irregular, and unpredictable (correct)
High, irregular, and predictable
Low, regular, and predictable

What is one way that low-income individuals often source pecuniary or in-kind support?

From family, friends, or remittances (C) Signup and view all the answers

What is the relationship between microfinancing and economic growth according to SainzFernandez's 2018 study?

High economic growth has a positive influence on the microfinance sector (C) Signup and view all the answers

What is the primary focus of microfinance institutions?

Providing financial services to low-income individuals (C) Signup and view all the answers

What is a characteristic of microcredit?

It does not require collateral (A) Signup and view all the answers

Who is the proponent of microcredit?

Muhammad Yunus (D) Signup and view all the answers

What is the purpose of microcredit?

To provide financial assistance to the poor (C) Signup and view all the answers

What is a common feature of ROSCAs?

They are informal financial institutions (B) Signup and view all the answers

Why are interest rates on microcredits relatively high?

Because of the risk of non-repayment (B) Signup and view all the answers

What is the goal of microcredit organizations?

To provide loans to those who can afford to repay (D) Signup and view all the answers

What is the term used in India to refer to ROSCAs?

Chit fund (A) Signup and view all the answers

How does an Auction ROSCA differ from a Random ROSCA?

In an Auction ROSCA, the one who bids the highest gets the pooled amount first. (D) Signup and view all the answers

What is the primary influence on financial inclusions in Islamic banking countries?

Macroeconomic factors (C) Signup and view all the answers

What is the foundation of the Islamic finance model?

The Koran and the Sunna (B) Signup and view all the answers

What is the name of the ROSCA in the Philippines?

Paluwagan (D) Signup and view all the answers

What is the primary goal of a well-functioning Islamic financial system?

To promote economic growth (C) Signup and view all the answers

What is the primary objective of financial systems?

To transform short-term liabilities into long-term assets (A) Signup and view all the answers

What is a key role of finance in achieving sustainability?

To rebuild and adapt the financial system to specifics of sustainable development (A) Signup and view all the answers

What is the relationship between financial development and income inequality according to Thang et al (2019)?

Income inequality rises at the early stage of financial development and falls after a certain level is achieved (C) Signup and view all the answers

What is the significance of finance in economic growth and development?

It is an efficient mechanism for sustainable economic growth and development (D) Signup and view all the answers

What is one of the roles of finance according to the text?

To screen and monitor investments (A) Signup and view all the answers

What is described as one-dimensional?

Modern financial systems (D) Signup and view all the answers

What is the Islamic finance model bound by?

Conventional body of rules and regulations, as well as historical, social and economic context (C) Signup and view all the answers

In the Gulf Cooperating Countries (GCC), what is the relationship between adopting Islamic finance and economic growth?

Direct relationship (C) Signup and view all the answers

What is the role of Islamic banks in addressing financial crises?

They reduce the severity of the crisis (A) Signup and view all the answers

What is the main contribution of the Philippines to Islamic finance?

Its Halal industry (C) Signup and view all the answers

What is the result of having knowledge of the Halal concept on one's agreement with the active role of Islamic finance?

More agreement (B) Signup and view all the answers

What is the ultimate goal of fostering synergy between Islamic finance and the development of Halal tourist products?

To contribute to economic growth and development (B) Signup and view all the answers