This quiz works best with JavaScript enabled. Home > Economics > International Economics > International Trade > International Trade – Quiz 50 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books International Trade Quiz 50 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. What is the purpose of a free-trade zone? A) To establish uniform tariffs for non-members. B) To regulate the production, pricing, and marketing of a product. C) To promote regional peace and stability. D) To eliminate trade barriers among its members. Show Answer Correct Answer: D) To eliminate trade barriers among its members. 2. Sources of comparative advantage A) Come from a stable exchange rate. B) Come from specialisation. C) Come from absolute advantage. D) Come from quantities and quality of factors of production. Show Answer Correct Answer: D) Come from quantities and quality of factors of production. 3. A limit on the quantity of a good that can be exported from a country during a specific time period; a type of trade barrier. A) Protective Tariff. B) Import Quota. C) Trade Embargo. D) VER. Show Answer Correct Answer: D) VER. 4. Explain the concept of protectionism in the context of international trade. A) The use of trade barriers to protect domestic industries from foreign competition. B) The elimination of tariffs and quotas. C) The promotion of free trade agreements. D) The encouragement of foreign competition. Show Answer Correct Answer: A) The use of trade barriers to protect domestic industries from foreign competition. 5. Which of the following allows countries which are members to impose a uniform tariff on trade with countries which are not members? A) An antitrust law. B) A trade surplus. C) A trade security contract. D) A free trade agreement. Show Answer Correct Answer: D) A free trade agreement. 6. Which of the following is an example of absolute advantage? A) The Philippines can produce clothing with fewer resources (money) used than the USA. B) The Philippines can't produce clothing with fewer resources (money) used than the USA. C) The Philippines can produce more resources (money) used than the USA. D) The Philippines can't produce more resources (money) used than the USA. Show Answer Correct Answer: A) The Philippines can produce clothing with fewer resources (money) used than the USA. 7. Which of the following is the purpose of commercial invoice in the international trade? A) A As a proof for insurance company recording the bill. B) B As an evidence for exporter receiving the goods. C) C As a document for the customs department collecting import duties. D) D As a reference for importer providing certificate of origin. Show Answer Correct Answer: C) C As a document for the customs department collecting import duties. 8. Any product that is bought from the global market. A) Export. B) Specialization. C) International trade. D) Import. Show Answer Correct Answer: D) Import. 9. ..... reduces trade barriers and encourages trade between countries. A) Free-trade zones. B) Free-trade agreements. C) Non-tariff alliances. D) Common markets. Show Answer Correct Answer: B) Free-trade agreements. 10. Which of the following was instrumental in creating the global economy that exists today? A) The use of high taxes for imports and exports. B) Improvements in technology such as the Internet. C) The creation of one form of currency (money) used to trade. D) The success of the Communist governments in guiding trade. Show Answer Correct Answer: B) Improvements in technology such as the Internet. 11. Regional trading block assosciated with trade in petroleum is ..... A) LAIA. B) NAFTA. C) OPEC. D) SAFTA. Show Answer Correct Answer: C) OPEC. 12. The growing increase in international trade along with the development of technology has fostered A) Many wars. B) An increase in world poverty. C) Globalization. D) All of these. Show Answer Correct Answer: C) Globalization. 13. Choose the incorrect statement. A) The act of opening up economies for trading is called trade liberalisation. B) Trade liberalisation is attained by increasing the tariff. C) It allows goods and services from everywhere to compete with domestic products. D) Trade liberalisation is not in favour of small businesses. Show Answer Correct Answer: B) Trade liberalisation is attained by increasing the tariff. 14. Imagine that Russia banned the import of beef from Sweden, and in response, Sweden levied a 100 percent tariff on fish imported from Russia. These nations are probably involved in a(n) A) Trade war. B) Embargo. C) Custom unions. D) Command economy. Show Answer Correct Answer: A) Trade war. 15. When a nation produces some goods but also imports some goods, A) The total output will increase. B) Worldwide employment will go down. C) Living standards of wealthy nations will go down. D) None of above. Show Answer Correct Answer: A) The total output will increase. 16. Opposite of 'decrease' A) Upwards. B) Fall. C) Drop. D) Slip. Show Answer Correct Answer: A) Upwards. 17. Inflow of Goods and Service is called as A) Import. B) Export. Show Answer Correct Answer: A) Import. 18. Sender A) Shipper. B) Sender. C) Importer. D) Exporter. Show Answer Correct Answer: B) Sender. 19. What is the balance of payments? A) An accounting statement that records all international transactions. B) An accounting statement that records a country's domestic transactions. C) An accounting statement that records a company's international transactions. D) An accounting statement that records a company's domestic transactions. Show Answer Correct Answer: A) An accounting statement that records all international transactions. 20. This benefit tends to increase at a much greater rate than the growth in world trade, helping boost technology transfer, industrial restructuring, and the growth of global companies. A) Economies of scale. B) Foreign Direct Investment. C) Technological Innovation. D) None of above. Show Answer Correct Answer: B) Foreign Direct Investment. ← 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