This quiz works best with JavaScript enabled. Home > Economics > International Economics > International Economics – Quiz 46 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books International Economics Quiz 46 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. The ..... is involved in the economy because it makes laws to protect businesses. A) Business. B) Foreign trade. C) Government. D) Global economy. Show Answer Correct Answer: C) Government. 2. Pounds = 1 US Dollar, if you exchange 1, 000 for Pound you would get ..... A) 15.3 Pounds. B) 530 Pounds. C) 1530 Pounds. D) 153 Pounds. Show Answer Correct Answer: C) 1530 Pounds. 3. Explain that most trade takes place because of ..... advantage in the production of a good or service. A) Absolute. B) Comparative. Show Answer Correct Answer: B) Comparative. 4. If a small country imposes a tariff on an imported good, its terms of trade will A) Improve. B) Worsen. C) Not change. D) Any of the above. Show Answer Correct Answer: C) Not change. 5. A tariff can ..... raise a country's welfare A) Never. B) Sometimes. C) Always. D) None of above. Show Answer Correct Answer: B) Sometimes. 6. An increase in the value of currency is called A) Appreciation. B) Depreciation. C) Trade surplus. D) Exchange rate. Show Answer Correct Answer: A) Appreciation. 7. What is the formula for calculating comparative advantage? A) Cost/Output. B) Output/Cost. Show Answer Correct Answer: A) Cost/Output. 8. Exchange rate is the ..... A) Makes travel more expensive for Americans. B) Makes travel cheaper for Americans. C) Value of a country's currency compared to another country's. D) Will increase imports to Americans. Show Answer Correct Answer: C) Value of a country's currency compared to another country's. 9. A person or organization that uses a product or service is a(n): A) Consumer. B) Economist. C) Loan shark. D) Debtor. Show Answer Correct Answer: A) Consumer. 10. Which of the following is NOT an argument in favor of protectionism? A) Protectionism shields infant industries from competition. B) Protectionism safeguards workers' jobs. C) Protectionism promotes industries that are essential to national security. D) Protectionism makes domestic firms more competitive in the long run. Show Answer Correct Answer: D) Protectionism makes domestic firms more competitive in the long run. 11. The U.S. can produce 50 cars and 25 tools. Peru can produce 20 cars and 15 tools. Who has the absolute advantage in tools? A) Peru. B) U.S. C) Neither. D) Not enough info. Show Answer Correct Answer: B) U.S. 12. If you are going to visit America and have $ 2999 to spend, how much currency could you obtain? (1AUD = 0.68USD) A) = 1x 0.68. B) = 1 / 0.68. C) = 2999 x 0.68. D) = 2999 / 0.68. Show Answer Correct Answer: C) = 2999 x 0.68. 13. Under a flexible exchange rate system, the indian rupee will appreciate against the Japanese yen when A) India's inflation rate exceeds japan's. B) India has a trade deficit with japan. C) Japan's economy enters a recession, but India's does not. D) Japan's money supply decreases while India's money supply increases. E) Real interest rates in India increase relative to those in Japan. Show Answer Correct Answer: E) Real interest rates in India increase relative to those in Japan. 14. The statement: "Absolute advantage requires one country to be better at production of one product and another country to be better at production of another good for specialization and trade to be mutually advantageous." A) Is not true at all. B) Poorly explains all trade flows in the modern global economy. C) Perfectly explains all trade flows in the modern global economy. D) Was fundamental for mercantilists. Show Answer Correct Answer: B) Poorly explains all trade flows in the modern global economy. 15. A factor of production that can be used in any sector of an economy is a(an) A) Specific factor. B) Mobile factor. C) Export-competing factor. D) Import-competing factor. Show Answer Correct Answer: B) Mobile factor. 16. A tax imposed by one country on the goods of another. A) Excise tax. B) Tariffs. C) Real estate tax. D) Sales tax. Show Answer Correct Answer: B) Tariffs. 17. ..... occurs, according to the U.S. Department of Commerce, whenever a U.S. citizen, organization, or affiliated group takes an interest of 10% or more in a foreign business entity. A) Foreign portfolio investment. B) Oversea remittance. C) Foreign direct investment. D) Official development assistance. Show Answer Correct Answer: C) Foreign direct investment. 18. Consider the following two cases. In the first, a U.S. firm purchases 18% of a foreign firm. In the second, a U.S. firm builds a new production facility in a foreign country. Both are ....., with the first referred to as ..... and the second as ..... A) Foreign direct investment (FDI); inflows; outflows. B) Foreign direct investment (FDI) inflows; brownfield; greenfield. C) Foreign direct investment (FDI) outflows; brownfield; greenfield. D) Foreign direct investment (FDI) outflows; greenfield; brownfield. E) Foreign direct investment (FDI) inflows; greenfield; brownfield. Show Answer Correct Answer: D) Foreign direct investment (FDI) outflows; greenfield; brownfield. 19. This is what you miss when you choose one choice over another. A) Sunk costs. B) Future costs. C) Opportunity costs. D) Income. Show Answer Correct Answer: C) Opportunity costs. 20. The difference between import tariffs and quotas is: A) Tariffs are a tax on locally produced goods but quotas limit the quantity of imports. B) Tariffs are a tax on imports and quotas are a tax on exports. C) Tariffs are a tax on imports and quotas limit the quantity of imports. D) Tariffs are a tax on all products but quotas just limit the quantity of imports. Show Answer Correct Answer: C) Tariffs are a tax on imports and quotas limit the quantity of imports. ← 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