1. "The biggest problem facing developing countries across the globe in 2006 was disease. The HIV/AIDS pandemic had infected more than 40 million worldwide and up to 40 percent of the adult populations of some African countries, such as Botswana. Describe the effects of HIV/AIDS on the economies of these countries. Make sure you discuss the sources of economic growth and the use of scarce resources.

2. For a developing country to grow, it needs capital. The major source of capital in most countries is domestic saving, but the goal of stimulating domestic saving usually is in conflict with government policies aimed at reducing inequality in the distribution of income. Comment on this trade-off between equity and growth. How would you go about resolving the issue if you were the president of a small, poor country?