This quiz works best with JavaScript enabled. Home > Economics > International Economics > International Economics – Quiz 13 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books International Economics Quiz 13 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. The International trad helps the economically backward and underdeveloped countries. A) True. B) False. Show Answer Correct Answer: A) True. 2. What action would benefit domestic producers? A) Higher tariffs. B) Lower tariffs. C) Lower quotas. D) Higher standards. Show Answer Correct Answer: A) Higher tariffs. 3. Exchange rate fluctuations will cause ..... A) An increase in the domestic price which leads to inflation. B) A decrease in the international price which lead to employment. C) Imported goods and services to face heavy profit. D) None of the above. Show Answer Correct Answer: A) An increase in the domestic price which leads to inflation. 4. ..... will increase the quantity of a product while decreasing the price. A) Subsidy. B) Quota. C) Embargo. D) Tariff. Show Answer Correct Answer: A) Subsidy. 5. What is not a part of the BoP A) Investment Account. B) Current Account. C) Financial Account. D) Capital Account. Show Answer Correct Answer: A) Investment Account. 6. ..... refers to the rate at which the goods of one country exchange for the goods of another country. A) Terms of trade. B) Balance of payment. C) Real cost. D) Quotas. Show Answer Correct Answer: A) Terms of trade. 7. How Plaza's supermarket deal with the blackout? A) Doing nothing. B) Invested in its own infrastructure. C) Using dynamo. D) None of above. Show Answer Correct Answer: B) Invested in its own infrastructure. 8. What was the name of the roadmap RBI called? A) Financial Sector Computing Vision Document (2005). B) Financial Sector Science Vision Document (2005). C) Financial Sector Technology Vision Document (2005). D) Financial Sector Telecommunications Vision Document (2005). Show Answer Correct Answer: C) Financial Sector Technology Vision Document (2005). 9. The product cycle theory of trade is essentially a A) Static, short run trade theory. B) Dynamic, long run trade theory. C) Zero-sum theory of trade. D) Negative-sum theory of trade. Show Answer Correct Answer: B) Dynamic, long run trade theory. 10. The deadweight loss of a tariff: A) Is a social loss since it promotes inefficient production. B) Is a social loss since it reduces the revenue for the government. C) Is not a social loss because society as a whole doesn't pay for the loss. D) Is not a social loss since only business firms suffer revenue losses. Show Answer Correct Answer: A) Is a social loss since it promotes inefficient production. 11. When the value of export is greater than the value of import, it is called ..... ? A) Trade surplus. B) Trade deficit. C) Protectionism. D) None of above. Show Answer Correct Answer: A) Trade surplus. 12. When the value of a nation's imports are greater than the value of its exports, the nation has ..... A) A trade surplus. B) A positive balance of payments. C) A favorable balance of trade. D) An unfavorable (negative) balance of trade. Show Answer Correct Answer: D) An unfavorable (negative) balance of trade. 13. The current account in the balance of payments consists of ..... A) Goods and services account and current transfer. B) Current transfer, direct investment and portfolio investment. C) Goods and service account, income account and current transfer. D) Income, current transfer, other investment and errors and omissions. Show Answer Correct Answer: C) Goods and service account, income account and current transfer. 14. Currency depreciation results in A) Increased exports, increased imports. B) Decreased exports, decreased imports. C) Increased exports, decreased imports. D) Decreased exports, increased imports. Show Answer Correct Answer: C) Increased exports, decreased imports. 15. The Panamanian balboa (currency) always exchanges at a rate of 1 balboa = 1 US dollar. The balboa has a(n) A) Floating exchange rate. B) Appreciating exchange rate. C) Depreciating exchange rate. D) Fixed exchange rate. Show Answer Correct Answer: D) Fixed exchange rate. 16. The value of a country's exports minus the value of its imports during a specific time. A) Balance of trade. B) Trade Surplus. C) Import. D) Export. Show Answer Correct Answer: A) Balance of trade. 17. Assume that Country A is relatively abundant in labor and Country B is relatively abundant in land. Note that wages are the returns to labor and rents are the returns to land. According to the factor price equalization theorem, once Country A begins specializing according to comparative advantage and trading with Country B A) Wages and rents should fall in Country A. B) Wages and rents should rise in Country A. C) Wages should rise and rents should fall in Country A. D) Wages should fall and rents should rise in Country A. Show Answer Correct Answer: C) Wages should rise and rents should fall in Country A. 18. ..... are the goods and services that a country produces domestically and sells to buyers in a foreign country A) Trade. B) Imports. C) Exports. D) Tariff. Show Answer Correct Answer: C) Exports. 19. An exchange rate is used to ..... A) Promote the argument supporting free trade. B) Promote the use of subsidies on foreign goods. C) Determine the process of one country's imports in terms of another country's exports. D) Determine the price of one country's currency in terms of another country's currency. Show Answer Correct Answer: D) Determine the price of one country's currency in terms of another country's currency. 20. Which of the following is an example of an institution whose primary concern is global economic stability? A) WTO. B) OPEC. C) The World Bank. D) IMF. Show Answer Correct Answer: D) IMF. ← PreviousNext →Related QuizzesEconomics QuizzesInternational Economics Quiz 1International Economics Quiz 2International Economics Quiz 3International Economics Quiz 4International Economics Quiz 5International Economics Quiz 6International Economics Quiz 7International Economics Quiz 8International Economics Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books