This quiz works best with JavaScript enabled. Home > Economics > International Economics > International Trade > International Trade – Quiz 76 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books International Trade Quiz 76 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. It refers to the ability of a producer (or country) to produce a good or service in greater quantity for the same cost, or the same quantity at lower cost, than other producers. A) Firm strategy. B) Absolute advantage. C) Comparative advantage. D) Factor endowments. Show Answer Correct Answer: B) Absolute advantage. 2. External economies of scale occur when cost per unit of output depends on ....., not necessarily on ..... Larger industry leads to the number of firms ..... A) The size of one firm-the size of the industry-increasing. B) The size of one firm-the size of the industry-decreasing. C) The size of the industry-the size of one firm-increasing. D) The size of the industry-the size of one firm-decreasing. Show Answer Correct Answer: C) The size of the industry-the size of one firm-increasing. 3. When a country has lower opportunity cost and has more efficiency it has ..... A) Comparative advantage. B) Specialization. C) Absolute Advantage. D) Embargoes. Show Answer Correct Answer: A) Comparative advantage. 4. The causes of international trade are the following, except..... A) Ethnic differences. B) Differences in natural resources. C) Technological Differences. D) Differences in Technological Results. Show Answer Correct Answer: A) Ethnic differences. 5. What is a disadvantage of increasing international specialisation? A Consumers pay higher prices for goods and services reducing their welfare. B Domestic firms may be uncompetitive leading to structural unemployment. C Domestic firms may experience rising costs as they pay more for imports. D Resources may be used less efficiently as domestic firms face less competition. A) A. B) B. C) C. D) D. Show Answer Correct Answer: B) B. 6. In a market economy, what is TRUE of all trade? A) It is expensive. B) It is voluntary. C) It is ordered by the government. D) It is forced by the seller. Show Answer Correct Answer: A) It is expensive. 7. Pakistan has been a member of WTO since it was founded in ..... A) 1995. B) 1997. C) 1999. D) None of above. Show Answer Correct Answer: A) 1995. 8. What is one effect of globalisation on either countries and people? A) It has no impact on trade, finance, or ideas. B) Globalization only involves the integration of trade. C) Increases the interdependence of people and countries. D) Results in the isolation of countries. Show Answer Correct Answer: C) Increases the interdependence of people and countries. 9. Determine which country has the comparative advantage:Korea can produce 3 cars or 9 motorcycle Germany can produce 4 cars or 8 motorcycles A) Korea has a comparative advantage in motorcycle and Germany has a comparative advantage on cars. B) Germany has a comparative advantage in motorcycle and Korea has a comparative advantage on cars. C) Both options are correct. D) None of above. Show Answer Correct Answer: A) Korea has a comparative advantage in motorcycle and Germany has a comparative advantage on cars. 10. Discuss the advantages and disadvantages of tariffs. A) Tariffs have no impact on domestic industries. B) Tariffs do not generate any revenue for the government. C) Advantages of tariffs include protecting domestic industries, generating revenue for the government, and reducing trade deficits. Disadvantages include higher prices for consumers, retaliation from other countries, and potential trade wars. D) Tariffs do not affect trade deficits. Show Answer Correct Answer: C) Advantages of tariffs include protecting domestic industries, generating revenue for the government, and reducing trade deficits. Disadvantages include higher prices for consumers, retaliation from other countries, and potential trade wars. 11. The certificate or origin helps to A) Identify the origin of a person. B) Know where exactly the products come from. C) Export and import products. D) All of the above. Show Answer Correct Answer: B) Know where exactly the products come from. 12. What percentage of total U.S. exports is accounted for by intrafirm exports? A) 30%. B) 20%. C) 40%. D) 10%. Show Answer Correct Answer: A) 30%. 13. Under the fixed exchange rate, the value of a country's currency is determined by the A) Amount of its gold reserves. B) Federal Reserve System. C) Forces of supply and demand. D) World Trade Organization. Show Answer Correct Answer: A) Amount of its gold reserves. 14. Which of the following is a supranational trade organization? A) World Trade Organization (WTO). B) United Nations (UN). C) European Union (EU). D) International Monetary Fund (IMF). Show Answer Correct Answer: C) European Union (EU). 15. What is a trade block? A) A group of countries that agree to trade more easily with each other. B) A restriction put in place by the government. C) A group of businesses that operate in multiple countries. D) A tax imposed on goods and services. Show Answer Correct Answer: A) A group of countries that agree to trade more easily with each other. 16. A visible Export is ..... A) A service that has been brought in from another country. B) A service that has been sold to another country. C) A physical good that has been brought in from another country. D) A physical good that has been sold to another country. Show Answer Correct Answer: D) A physical good that has been sold to another country. 17. In part, a country's currency account measures A) Its current debt as as opposed to its long term debt. B) Receipts from the sale of goods services to foreigners and payments for goods and services bought from foreigners. C) Net increases and decreases in a country's holdings of foreign currency. D) Borrowing and lending activity between the country's residents and foreigners. Show Answer Correct Answer: B) Receipts from the sale of goods services to foreigners and payments for goods and services bought from foreigners. 18. What is the meaning of international trade? A) The movement of goods and services between different countries. B) The exchange of ideas and cultural practices between nations. C) The establishment of diplomatic relations among countries. D) The formation of international agreements for military alliances. Show Answer Correct Answer: A) The movement of goods and services between different countries. 19. What is it called when a company focuses on producing one type of good or service? A) Specialization. B) Productivity. C) Underutilization. D) GDP per capita. Show Answer Correct Answer: A) Specialization. 20. What year was the NAFT (National American Free Trade) Agreement signed? A) 1993. B) 1990. C) 1994. D) 1998. Show Answer Correct Answer: C) 1994. ← 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