This quiz works best with JavaScript enabled. Home > Economics > International Economics > International Trade > International Trade – Quiz 85 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books International Trade Quiz 85 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Why does the US import most its clothing? A) Domestic clothing has absolute advantage. B) Other countries have comparative advantage in making clothing. C) Foreign Producers of clothing. D) Department stores sell clothing. Show Answer Correct Answer: B) Other countries have comparative advantage in making clothing. 2. In the 2-factor, 2 good Heckscher-Ohlin model, the two countries differ in ..... A) Tastes and preferences. B) The size of their economies. C) Relative abundance of factors of production. D) Labor productivity. Show Answer Correct Answer: C) Relative abundance of factors of production. 3. A boycott is A) A refusal to buy goods. B) A place to buy tea. C) A group in support of taxes. D) A kind of shirt worn by colonists. Show Answer Correct Answer: A) A refusal to buy goods. 4. True or False A protectionist is A person or policy advocating for the protection of domestic industries from foreign competition. A) True. B) False. Show Answer Correct Answer: A) True. 5. What is one limitation of the theory of comparative advantage regarding the assumption of specialization in producing a single good? A) It assumes that every country should specialize in producing the good with the lowest opportunity cost. B) It assumes that everyone has the same knowledge of prices and quantities in the market at the same time. C) It assumes that technology remains constant. D) It assumes that countries produce identical goods. Show Answer Correct Answer: D) It assumes that countries produce identical goods. 6. Any law that limits free trade between nations A) Embargo. B) Trade Barrier. C) Quota. D) None of above. Show Answer Correct Answer: B) Trade Barrier. 7. The process by which people and economies around the world are becoming increasingly interconnected; the integration of national economies into the global economy. A) Trade Barrier. B) Globalization. C) Macroeconomics. D) Microeconomics. Show Answer Correct Answer: B) Globalization. 8. In 1941, the US froze Japanese assets in America and stopped trading with them in response to Japan's invasion of French Indochina A) Tariff. B) Quota. C) Standard. D) Subsidy. E) Embargo. Show Answer Correct Answer: E) Embargo. 9. Under a flexible exchange-rate system, the Indianrupee will appreciate against the Japanese yenwhen A) India's inflation rate exceeds Japan's. B) India has a trade deficit with Japan. C) Japan's economy enters a recession, but India's does not. D) Japan's money supply decreases whileIndia's money supply increases. E) Real interest rates in India increase relativeto those in Japan. Show Answer Correct Answer: E) Real interest rates in India increase relativeto those in Japan. 10. Goods and services a nation sells to other countries A) Imports. B) Exports. C) Tariffs. D) Embargo. Show Answer Correct Answer: B) Exports. 11. Who benefits from the depreciation of the Japanese yen relative to the Euro? A) European consumers of European Goods. B) Japanese consumers of Japanese Goods. C) European consumers of Japanese Goods. D) None of above. Show Answer Correct Answer: C) European consumers of Japanese Goods. 12. A country's terms of trade changed from 100 to 95. What is most likely to have caused this change? A a depreciation of the country's currency B a reduction in import tariffs C a rise in the price of exported goods D an improvement in the balance of trade A) A. B) B. C) C. D) D. Show Answer Correct Answer: A) A. 13. Method used to stop the shipment of certain products to and from a particular country for economic or political reasons A) Embargo. B) Foreign Exchange Rate. C) Tariff. D) Quota. Show Answer Correct Answer: A) Embargo. 14. Cabot discovered and named one of the provinces of Canada which is Quebec. A) TRUE. B) FALSE. Show Answer Correct Answer: B) FALSE. 15. In the US Current Account, we usually operate with a A) Deficit. B) Surplus. Show Answer Correct Answer: A) Deficit. 16. An ad valorem would be considered which of the following? A) License. B) Embargo. C) Quota. D) Tariff. Show Answer Correct Answer: A) License. 17. American and Japanese workers can each produce 4 cars a year. An American worker can produce 10 tons of grain a year, whereas a Japanese worker can produce 5 tons of grain a year. To keep things simple, assume that each country has 100 million workers. Which country has an absolute advantage in producing cars? A) America. B) Japan. C) None. D) None of above. Show Answer Correct Answer: C) None. 18. A major determinant of how much knowledge a company gains from an alliance is its ability to learn from its alliance partner. A) True. B) False. Show Answer Correct Answer: A) True. 19. Import of goods that are dangerous to society is prohibited A) Quota policy. B) Tariff policy. C) Subsidy policy. D) Import prohibition policy. Show Answer Correct Answer: D) Import prohibition policy. 20. A quota on imports is A) A legal limit on the quantity of imports. B) A tax on imports. C) A subsidy on imports. D) A combination of tax and legal limit on imports. Show Answer Correct Answer: A) A legal limit on the quantity of imports. ← 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