This quiz works best with JavaScript enabled. Home > Economics > International Economics > International Trade > International Trade – Quiz 44 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books International Trade Quiz 44 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. One of the following trade blocs is NOT composed of Latin American countries: A) EFTA. B) OPEC. C) MERCOSUR. D) NAFTA. Show Answer Correct Answer: A) EFTA. 2. Which statement is not a valid reason why a country may impose protectionist measures? A to allow a newly developed domestic industry to grow to a viable size B to enable a country to retain control of an industry it regards as being of strategic importance C to give consumers a wider choice of goods and services D to give time for workers in a declining domestic industry to find alternative employment A) A. B) B. C) C. D) D. Show Answer Correct Answer: C) C. 3. Japan now produces over half of the wrist watches available for sale in the United States. Suppose the United States government places a quota on foreign watches. Which of the following would result from change in quota on wrist watches. A) The prices of watches will be eliminated. B) The price of watches will decrease. C) The price of watches will be unchanged. D) The price of watches will increase. Show Answer Correct Answer: D) The price of watches will increase. 4. Factors driving international trade A) Quota. B) Cultural Differences. C) Politics. D) Protection. Show Answer Correct Answer: B) Cultural Differences. 5. It means the price includes the cost of goods and transport charges to the destination port. A) INCOTERMS-FREE ON BOARD. B) EXW (EX WORKS). C) INCOTERMS-COST & FREIGHT (CFR). D) None of above. Show Answer Correct Answer: C) INCOTERMS-COST & FREIGHT (CFR). 6. The US imposed tariffs on cars and motorcycles from Germany. What is the effect of these tariffs? A decrease in inflation in the US B decrease in trade between the US and Germany C increase in profits of car and motorcycle producers from Germany D increase in standards of living in the US and in Germany A) A. B) B. C) C. D) D. Show Answer Correct Answer: B) B. 7. Which of the following applies to a real-world socialistic economy? A) Private ownership of all factors of production. B) Government ownership of all factors of production. C) Government ownership of most of the factors of production. D) Lack of central planning. Show Answer Correct Answer: B) Government ownership of all factors of production. 8. U.S. is referred to the bread basket of the world because ..... A) All are true. B) We have a skilled workforce. C) We have a thriving agricultural industry. D) Of our ability to produce crops such as wheat and corn. Show Answer Correct Answer: A) All are true. 9. ..... deals in a large number of goods. A) Retailer. B) Wholesaler. C) Broker. D) Agent. Show Answer Correct Answer: A) Retailer. 10. What does the word INCOTERMS refer to? A) International Commercial Terms. B) International Common Terms. C) International Collaborative Terms. D) All of them are correct. Show Answer Correct Answer: A) International Commercial Terms. 11. The longest running embargo is? A) Russia's embargo on the US. B) The US embargo on Cuba. C) Cuba's embargo on Italy. D) Jamaica's embargo on Australia. Show Answer Correct Answer: B) The US embargo on Cuba. 12. Why do companies export goods? A) Expansion into an unsaturated market. B) Smoothing out sales (sesasonal items). C) Increasing sales and economic growth, which leads to new jobs. D) All of these. Show Answer Correct Answer: D) All of these. 13. Why is the market of each country different? A) Money exchange. B) International relationships. C) Culture and lifestyle, population demographic characteristics, demand and purchasing habits etc. D) Goverment and its economic politics. Show Answer Correct Answer: C) Culture and lifestyle, population demographic characteristics, demand and purchasing habits etc. 14. A trade deficit is A) Sustainable in the long-run. B) Never sustainable. C) Sustainable in the short-run. D) Sustainable in both the short and long run. Show Answer Correct Answer: C) Sustainable in the short-run. 15. Which of the following was the first international trade theory to account for changes in the patterns of trade over time? A) Comparative advantage theory. B) Absolute advantage theory. C) Product life cycle theory. D) Factor endowment theory. Show Answer Correct Answer: C) Product life cycle theory. 16. Decisions issued by the WTO dispute settlement system are..... A) Politically-binding. B) Economically-binding. C) Legally-binding. D) Sociologically-binding. Show Answer Correct Answer: C) Legally-binding. 17. In the Ricardian model, we can think of trade as ..... method of production. A) A direct. B) An indirect. C) A correct. D) An incorrect. Show Answer Correct Answer: B) An indirect. 18. International trading IMPORT-EXPORT What factors should you look at? A) Transport mode, product type, conditions. B) Bank used. C) Seller's requirements. D) Main product weight. Show Answer Correct Answer: A) Transport mode, product type, conditions. 19. Why do changing exchange rates help one country and hurt the other? A) One side loses purchasing power and the other gains it. B) Takes money away from one side and gives it to the other. C) Causes war between the two countries. D) One country's government introduces tariffs to protect local industries. Show Answer Correct Answer: A) One side loses purchasing power and the other gains it. 20. Which of the following strategies involves increasing the supply of a product so much that its prices drops severely, forcing similar products out of the market? A) Specialization. B) Dumping. C) Setting quotas. D) Trade restrictions. Show Answer Correct Answer: B) Dumping. ← PreviousNext →Related QuizzesInternational Economics QuizzesEconomics QuizzesInternational Trade Quiz 1International Trade Quiz 2International Trade Quiz 3International Trade Quiz 4International Trade Quiz 5International Trade Quiz 6International Trade Quiz 7International Trade Quiz 8 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books