Differentiate between developed and underdeveloped countries on the basis ofimpact of the shocks and stimulants.

Developed and underdeveloped countries respond differently to shocks and stimulants due to their varying levels of economic stability, infrastructure, and resilience. Here's a step-by-step differentiation:

1. Economic Stability: Developed countries have a stable economy, which means they can absorb shocks better. They have a diverse range of industries, so if one sector is hit, others can compensate. Underdeveloped countries, on the other hand, often rely on a single industry or a few industries, making them more vulnerable to shocks.

2. Infrastructure: Developed countries have robust infrastructure, including transportation, healthcare, and communication systems. This infrastructure can help mitigate the impact of shocks and enhance the effect of stimulants. Underdeveloped countries often lack this infrastructure, which can exacerbate the impact of shocks and limit the effectiveness of stimulants.

3. Resilience: Developed countries have more resources to invest in resilience, such as emergency funds, insurance systems, and social safety nets. These resources can help cushion the impact of shocks. Underdeveloped countries often lack these resources, making them more susceptible to shocks.

4. Response to Stimulants: Developed countries have more capacity to respond to stimulants, such as fiscal stimulus or technological innovation. They have the resources to invest in new technologies and the infrastructure to implement them. Underdeveloped countries may lack the resources or infrastructure to take full advantage of these stimulants.

5. Dependence on External Aid: Underdeveloped countries are often more dependent on external aid, which can be a shock or a stimulant. If the aid is withdrawn or reduced, it can be a shock. If the aid is increased or targeted effectively, it can be a stimulant. Developed countries are less dependent on external aid.

6. Social Factors: Social factors, such as education levels, health outcomes, and social cohesion, can also influence how countries respond to shocks and stimulants. Developed countries generally have better education and health outcomes, which can enhance their ability to respond to shocks and stimulants. Underdeveloped countries often struggle with these issues, which can limit their ability to respond.