This quiz works best with JavaScript enabled. Home > Economics > International Economics > International Economics – Quiz 27 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books International Economics Quiz 27 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. What trade barrier puts a tax on imported goods? A) Tariff. B) Embargo. C) Subsidy. D) Standard. Show Answer Correct Answer: A) Tariff. 2. Lana can bake 10 cakes in 8 hours, while Lenny can bake 4 cakes in 8 hours. Lenny has an Absolute Advantage in making cakes. A) True. B) False. Show Answer Correct Answer: B) False. 3. Which party does NPCI cooperate with? A) Discover Financial Services. B) Japan Credit Bureau. C) China UnionPay International. D) All of the above. Show Answer Correct Answer: D) All of the above. 4. Which of the following will increase the United States trade deficit? A) United States firms buying technologically advanced computers from Germany. B) European citizens traveling in large numbers to the United States. C) A United States company being hired to build a production plant in another country. D) The United States dollar depreciating in the foreign exchange market. E) The United States selling one million tons of wheat to China. Show Answer Correct Answer: A) United States firms buying technologically advanced computers from Germany. 5. Why is an embargo used in situations where countries have severe political differences? A) An embargo is a way to increase trade between countries. B) A country can set unfair standards for the opposing country. C) Embargoes typically ban all trade between two countries. D) The taxes collected on imports can be used for military tactics. Show Answer Correct Answer: C) Embargoes typically ban all trade between two countries. 6. Which of the following is most likely to benefit from an appreciation in the United States dollar in the short run? A) United States investors holding European bonds. B) Importers in foreign countries seeking raw inputs at a lower price. C) United States exporters selling capital equipment. D) United States tourists traveling to foreign countries. E) European consumers buying United States goods. Show Answer Correct Answer: D) United States tourists traveling to foreign countries. 7. Goods a country sells to other countries. A) Import. B) Export. C) Quota. D) Subsidy. Show Answer Correct Answer: B) Export. 8. Higher income levels in the UK would result in A) Increased exports and appreciation of the £. B) Increased exports and depreciation of the £. C) Increased imports and appreciation of the £. D) Increased imports and depreciation of the £. Show Answer Correct Answer: D) Increased imports and depreciation of the £. 9. What is Balance of Payment A) Transfer of money going in and out of country. B) Mrs. Lee giving money to a student. C) Mr. Mosley transferring money to his wife's account. D) None of above. Show Answer Correct Answer: A) Transfer of money going in and out of country. 10. Motivation for countries to trade A) Obtaining scarce resources. B) Decrease in wages. C) Higher cost on products. D) None of above. Show Answer Correct Answer: A) Obtaining scarce resources. 11. The trade theory that first indicated importance of specialization in production and division of labor is based on the idea of ..... which is developed first by Adam Smith in his famous book, The Wealth of Nations, published in 1776. A) Theory of comparative advantage. B) Theory of absolute advantage. C) Theory of relative advantage. D) Theory of static advantage. Show Answer Correct Answer: B) Theory of absolute advantage. 12. Which of these are *NOT* trade barriers A) Licenses. B) Environmental regulations. C) Health measures. D) Grants. Show Answer Correct Answer: D) Grants. 13. An embargo is A) A tax on imports. B) A cash grant or loan from the government to support the business. C) An official ban on trade. D) A specific number of imports allowed. Show Answer Correct Answer: C) An official ban on trade. 14. Tariffs are used to protect "Infant Industries" A) True. B) False. Show Answer Correct Answer: A) True. 15. When one country can produce a product more cheaply than another country can, this is called A) A tariff. B) Free trade. C) Comparative advantage. D) Absolute advantage. Show Answer Correct Answer: C) Comparative advantage. 16. Are quotas that lead to a complete abolishment of trade. A) Embargoes. B) Voluntary export restraints. C) Nontariff barriers. D) Orderly marketing agreements. Show Answer Correct Answer: A) Embargoes. 17. International transactions require conversions between currencies. A) True. B) False. Show Answer Correct Answer: A) True. 18. Declining costs per unit of output results from international trade especially if: A) International trade affords producers monopoly power. B) National governments levy import tariffs and quotas. C) Producing goods entails increasing costs. D) Economies of scale exist for producers. Show Answer Correct Answer: D) Economies of scale exist for producers. 19. Comparative Advantage A) Which country can produce a greater amount of the product. B) Which country can produce a better product. C) Which country is better compared to the other. D) None of above. Show Answer Correct Answer: A) Which country can produce a greater amount of the product. 20. A succession of trade barriers between nations. A) Quota. B) Trade Wars. C) Embargo. D) Protective Tariff. Show Answer Correct Answer: B) Trade Wars. ← 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