Impact of Natural Resources Practice Test

In the context of the article, Norway and Venezuela both possess large petroleum reserves, but the passage contrasts their governance choices. Norway channels oil income into a sovereign wealth fund, uses transparent budgeting, and maintains strong checks on executive power, which helps smooth price cycles. Venezuela relied more heavily on oil to fund expansive subsidies and state-led programs, while politicized institutions and policy volatility increased vulnerability to shocks. Based on the passage, which governance model is most effective in managing natural resources?​

In the context of the article, South Korea is portrayed as resource-scarce and highly dependent on imported energy and industrial inputs. The passage links this constraint to state support for innovation, investment in shipbuilding and electronics, and active trade diplomacy to secure stable supply chains. It also describes how vulnerability to price spikes encourages strategic reserves and efficiency measures, while democratic accountability shapes debates over energy mix and costs. Based on the passage, how does resource scarcity impact economic development in South Korea?​