This quiz works best with JavaScript enabled. Home > Economics > International Economics > International Trade > International Trade – Quiz 79 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books International Trade Quiz 79 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Gains from trade ALWAYS exist when A) One trading partner has an absolute advantage. B) The two trading partners have different comparative advantages. C) One trading partner has more capacity than the other. D) The two trading partners have identical production possibility frontiers. E) Neither trading partner has an absolute advantage. Show Answer Correct Answer: B) The two trading partners have different comparative advantages. 2. A policy of high barriers to trade. A) Barriers to trade. B) Subsidies. C) Protectionism. D) Exchange rate. Show Answer Correct Answer: C) Protectionism. 3. Factors that affect foreign exchange rates, except ..... A) Government Policy. B) Inflation. C) Interest rate. D) Investment. Show Answer Correct Answer: D) Investment. 4. ..... are taxes on imported goods and raise the price of imported goods above the world price. A) Tariffs. B) Import Quotas. Show Answer Correct Answer: A) Tariffs. 5. Which is true about the relation between inflation and trade balance? A) Lower inflation would impact exports, thus affecting the trade balance. B) Inflation will lead to a weakening of competitiveness and ultimately lead to a decline in exports. C) The increase in the current account surplus can be a result of an increase in imports which leads to imported inflation. D) Increase in money supply in the market increases the purchasing power of money, reducing general price in the market. Show Answer Correct Answer: B) Inflation will lead to a weakening of competitiveness and ultimately lead to a decline in exports. 6. Why do countries impose tariffs on imported goods? A) To promote international cooperation and goodwill. B) To protect domestic industries, reduce trade deficits, and generate revenue for the government. C) To increase the cost of living for citizens. D) To encourage foreign investment in domestic industries. Show Answer Correct Answer: B) To protect domestic industries, reduce trade deficits, and generate revenue for the government. 7. Tariffs are very important in international trade as a catalyst for the development of national profits and traders. A) Yes. B) No. Show Answer Correct Answer: A) Yes. 8. Export-biased growth in Home will A) Improve the terms of trade of Home. B) Trigger anti-bias regulations of the WTO. C) Worsen the terms of trade of Foreign (the trade partner). D) Improve the terms of trade of Foreign. Show Answer Correct Answer: A) Improve the terms of trade of Home. 9. Which of the following issues is the center of an anti-globalization argument? A) Globalization and the environment. B) Globalization and Economic. C) Environment and science. D) Globalization and Social relations. Show Answer Correct Answer: A) Globalization and the environment. 10. The United States imports oil from Saudi Arabia. Japan exports cars to the United States. The United States sells high technology to Saudi Arabia. Which of the following is a valid conclusion that can be drawn from these statements? A) Most nations of the world specialize in one export. B) The nations of the world are economically interdependent. C) The U.S. is the world's leading exporter. D) Saudi Arabia controls most of the world's natural resources. Show Answer Correct Answer: B) The nations of the world are economically interdependent. 11. Who introduced the concept of comparative advantage in the early 19th century? A) Adam Smith. B) David Ricardo. C) Frederick Engels. D) Thomas Malthus. Show Answer Correct Answer: B) David Ricardo. 12. The dollar weakens. A) Appreciate. B) Depreciate. Show Answer Correct Answer: B) Depreciate. 13. An important international trade document that certifies that goods in a particular export shipment are wholly obtained, produced, manufactured or processed in a particular country: A) Bill of lading. B) Certificate of origin. C) CIF. D) C&H. Show Answer Correct Answer: B) Certificate of origin. 14. It is a statement that keeps track of all economic transactions done by the country with the remaining world. A) Balance of Trade. B) Positive Balance. C) Balance of Payment. D) External Transaction. Show Answer Correct Answer: C) Balance of Payment. 15. This agent helps importers and exporters move their goods through customs.Customs brokers prepare documents, assist with communications, and arrange payment of duties. A) TAXES BROKER. B) FREIGHT BROKER. C) CUSTOMS BROKER. D) None of above. Show Answer Correct Answer: C) CUSTOMS BROKER. 16. William is studying the foreign exchange market and notices that a particular currency is appreciating in value. What does this mean for that currency in the foreign exchange market? A) It becomes more expensive in the foreign exchange market. B) It becomes less expensive in the foreign exchange market. C) It has no impact on the foreign exchange market. D) It leads to inflation in the domestic economy. Show Answer Correct Answer: A) It becomes more expensive in the foreign exchange market. 17. T or F:The global supply and demand will ensure productivity A) True. B) False. Show Answer Correct Answer: A) True. 18. What year ended the Bretton Wood System? A) 1970. B) 1972. C) 1971. D) 1969. Show Answer Correct Answer: C) 1971. 19. Trade between two countries can be useful if cost ratios of goods are Equal A) True. B) False. Show Answer Correct Answer: B) False. 20. In order to get a full ....., customers must send back goods in the original packaging. A) Discount. B) Voucher. C) Refund. D) Return. Show Answer Correct Answer: C) Refund. ← 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