Characteristics of A Developing/Underdeveloped Economy - SS3 Economics Past Questions and Answers - page 1

Developing economies may have limited access to credit due to weak financial systems, limited collateral, and a lack of credit history. Additionally, developing economies may face higher risk and uncertainty, which can lead to higher interest rates and further limit access to credit.

Dependence on primary industries in a developing economy can lead to vulnerability to fluctuations in commodity prices. This can limit economic diversification and create a reliance on a small number of industries, which can be a risk to long-term economic stability.