Question

Realizing that poor countries must solve many problems at once has shifted donors away from the idea of giving multiple small payments and toward the idea of a “Big Push”. This Big Push entails giving a very large sum of money that could be used to fix multiple problems at once. In fact, the amount of money required might be so large that rich countries might be the only ones who could afford the donation.

From the recipient's perspective, the trade-off associated with this idea is that:

a.	a developing country might begin pushing for policies that it thinks will attract more foreign funds, rather than pushing for policies that are actually in the country's best interests.
b.	a large donation might make it more difficult to repay the funds in a timely manner.
c.	a sudden large donation might make it more difficult to allocate the funds to the needed projects.
d.	reducing poverty and encouraging sustainable growth might overstimulate the economy, leading to inflation.

Answer 1

Ans) the correct option is a) a developing country might begin pushing for policies that it thinks will attract more foreign funds, rather than pushing for policies that are actually in the country's best interests.