This quiz works best with JavaScript enabled. Home > Economics > International Economics > International Trade > International Trade – Quiz 4 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books International Trade Quiz 4 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Which of the following ideas is closely linked to the theory of absolute advantage? A) All international trade must be closely regulated by governments. B) Free market forces should determine how much to trade with minimal government intervention. C) Governments should actively protect domestic industries from imports and vigorously promote exports. D) Nations should specialize in economic activities in which they have comparative advantage. Show Answer Correct Answer: B) Free market forces should determine how much to trade with minimal government intervention. 2. Which economic theory suggests that a country should specialize in producing goods? A) Absolute advantage. B) Comparative advantage. C) Balance of trade. D) Protectionism. Show Answer Correct Answer: A) Absolute advantage. 3. Which mean is more expensive? A) By Air. B) By Ocean. C) By Truck. D) None of above. Show Answer Correct Answer: A) By Air. 4. Raw materials proper from Colombia are definitely not A) Sugar cane, cocoa, coffee and emeralds. B) Rice, weat, flowers and oil. C) Iron, corn, tuna and cotton. D) Oil, coffee, flowers and emeralds. Show Answer Correct Answer: C) Iron, corn, tuna and cotton. 5. Which of the following is not a disadvantage of International Trade A) Exchange rates increasing costs. B) Reduced Risks of falling sales. C) Local taxes and laws creating additional costs. D) Problems with supply chains could delay production of products. Show Answer Correct Answer: B) Reduced Risks of falling sales. 6. The primary focus of the Trade-Weighted Value of the Dollar is to: A) Evaluate the overall health of the economy. B) Determine the value of domestic goods. C) Measure the value of the U.S. dollar against a basket of currencies. D) Set exchange rates between countries. Show Answer Correct Answer: C) Measure the value of the U.S. dollar against a basket of currencies. 7. The following differences give rise to international trade: A) Availability of factors of production. B) Socio-economic. C) Geographical. D) All of the Above. Show Answer Correct Answer: D) All of the Above. 8. Companies that sell products from within the country to abroad are called..... A) Kurir. B) Importer. C) Exporter. D) All answers are correct. Show Answer Correct Answer: C) Exporter. 9. The agency that was created to police the General Agreement on Tariffs and Trade (GATT)? A) U.S. Customs Services. B) Federal Trade Commission. C) World Trade Organization. D) United Nations Trade Group. Show Answer Correct Answer: C) World Trade Organization. 10. Country A sells goods to Country C. Country A acts as..... A) Exporter. B) Importer. Show Answer Correct Answer: A) Exporter. 11. Goods and services a country produces and sells to other countries A) Imports. B) Exports. C) Demand. D) Supply. Show Answer Correct Answer: B) Exports. 12. A J curve suggests that: A) Imports and exports are price inelastic in the short run but elastic in the long run. B) Imports and exports are price inelastic in the short run and in the long run. C) Imports and exports are price elastic in the short run and in the long run. D) Imports and exports can be either price inelastic or price elastic. Show Answer Correct Answer: A) Imports and exports are price inelastic in the short run but elastic in the long run. 13. The WTO is a global organization that helps A) Eliminate world hunger. B) Promote world peace. C) Negotiate global trade agreements and resolve trade disputes. D) All of these. Show Answer Correct Answer: C) Negotiate global trade agreements and resolve trade disputes. 14. Which of the following is least risky? A) Export. B) Joint venture. C) Wholly owned subsidiary. D) All have same risk. Show Answer Correct Answer: A) Export. 15. If the seller and buyer agree that the transaction will be paid in full by the buyer at a later date on the agreed date, the payment method is called..... A) Open Account. B) Letter of Credit. C) Advance Payment. D) Documentary Collection. Show Answer Correct Answer: A) Open Account. 16. Which of these are negative impacts of a multinational company? A) Purchasing Economies of Scale. B) Lower production costs. C) Tax advantages. D) Laws in other countries may be different. Show Answer Correct Answer: D) Laws in other countries may be different. 17. What is the main benefit of international trade in terms of consumer choice? A) Reduced access to goods and services. B) Limited variety of products. C) Increased consumer choices and access to a variety of goods. D) Higher prices for goods. Show Answer Correct Answer: C) Increased consumer choices and access to a variety of goods. 18. An economy will be indifferent as to what goods that will be produced when the relative price of that good is ..... to its opportunity cost. A) Equal. B) Inverse. C) Proportional. D) Constant. Show Answer Correct Answer: A) Equal. 19. Why are quotas an example of protectionism? A) Quotas increase the volume of trade. B) Quotas remove restrictions on trade. C) Quotas create trade barriers by limiting imports. D) Quotas ignore the needs of domestic industries. Show Answer Correct Answer: C) Quotas create trade barriers by limiting imports. 20. Many engineers of the 1970s made great computers, but only a few were, , , , , , enough to see the business possibilities in the new machines A) Intrepid. B) Shuttle. C) Haggle. D) Entrepreneurial. Show Answer Correct Answer: D) Entrepreneurial. ← PreviousNext →Related QuizzesInternational Economics QuizzesEconomics QuizzesInternational Trade Quiz 1International Trade Quiz 2International Trade Quiz 3International Trade Quiz 5International Trade Quiz 6International Trade Quiz 7International Trade Quiz 8International Trade Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books