This quiz works best with JavaScript enabled. Home > Finance > Economics > International Economics > International Economics – Quiz 23 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books International Economics Quiz 23 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. IBRD stands for..... A) International Bank for Reconstruction and Development. B) Industrial Bank for Revival and Development. C) Investment Bank for Reconstruction and Development. D) Indian Bank for Reconstruction and Development. Show Answer Correct Answer: A) International Bank for Reconstruction and Development. 2. What is a consequence of quotas for consumers in the US? A) Lower prices. B) Higher Prices. C) Higher standards set on imported goods. D) Lower subsidies. Show Answer Correct Answer: B) Higher Prices. 3. Ad valorem tariff is a ..... A) Tariff imposed on imported goods based on the value of the good. B) Tariff imposed by the government on the imposed products. C) Tariff imposed by the government on the exported products. D) Tariff imposed in a fixed amount charged per unit of imported goods. Show Answer Correct Answer: A) Tariff imposed on imported goods based on the value of the good. 4. International trade and specialization most often lead to which of the following? A) An increase in a nation's productivity. B) A decrease in a nation's economic growth in the long term. C) An increase in a nation's import tariffs. D) A decrease in a nation's standard of living. Show Answer Correct Answer: A) An increase in a nation's productivity. 5. Having a comparative advantage in a good means that a country can produce the good A) Better than every other country in the world. B) At a lower opportunity cost compared to another country. C) Comparatively faster than any other country. D) Cheaper than most countries. Show Answer Correct Answer: B) At a lower opportunity cost compared to another country. 6. A trade war is a cost of A) Trading blocs. B) Exchange rates. C) Trade barriers. D) Globalization. Show Answer Correct Answer: C) Trade barriers. 7. An argument against trade protectionism is that it will increase A) The current account deficit. B) Domestic price level. C) Opportunities for domestic infant industries. D) Competition for domestic industries. Show Answer Correct Answer: B) Domestic price level. 8. What 2 things made international trade easier? A) Currency & trade barriers. B) Currency & specialization. C) Currency & exchange rates. D) Exchange rates & trade barriers. Show Answer Correct Answer: C) Currency & exchange rates. 9. Why World Bank was established? A) None below. B) To improve the adverse Balance of Payment situation of the nonmember countries. C) To reconstruct the economies damaged during the Second World War. D) To promote the International Trade. Show Answer Correct Answer: C) To reconstruct the economies damaged during the Second World War. 10. Which of the following is the gain to nations from international trade? A) The world output will increase. B) Greater advancement in technology. C) Widened choices to the domestic trade. D) All the above. Show Answer Correct Answer: D) All the above. 11. Compartive advantage is a contributing factor to ..... A) International Economic Competition. B) Absolute Advantage. C) International Conflicts. D) International trade. Show Answer Correct Answer: D) International trade. 12. An economy without trade relations with other countries is called A) Closed economy. B) Open economy. C) Protected economy. D) An unprotected economy. Show Answer Correct Answer: A) Closed economy. 13. International trade results in not equalization of price A) False. B) True. Show Answer Correct Answer: A) False. 14. A tariff can be defined as a: A) Legal limit on exports. B) Legal limit on imports. C) Tax on imports. D) Tax on exports. Show Answer Correct Answer: C) Tax on imports. 15. A firm's foreign direct investment. decisions are, in the case of horizontal FDI, strongly influenced by ..... and, in the case of vertical FDI, strongly influenced by ..... A) Trade costs; production costs. B) Materials costs; labor costs. C) Labor costs; trade costs. D) Production costs; trade costs. Show Answer Correct Answer: A) Trade costs; production costs. 16. This refers to the price of one country's currency expressed in terms of another country's currency. A) Currency Rate. B) Money Rate. C) Exchange rate. D) None of the above. Show Answer Correct Answer: C) Exchange rate. 17. The statement that "tariffs are needed to protect Malaysian firm from foreign producers who sell excess goods in the Malaysian markets at less cost" could be most closely associated with which tariff argument? A) Diversification for stability. B) Protection against dumping. C) Increased domestic employment. D) Cheap foreign labour. Show Answer Correct Answer: B) Protection against dumping. 18. Which of the following is not the objective of the IMF? A) To promote international monetary cooperation. B) To ensure balanced international trade. C) To provide loan to private sectors. D) To ensure exchange rate stability. Show Answer Correct Answer: C) To provide loan to private sectors. 19. Trade bloc:France, Germany, Spain A) European Union. B) NAFTA. C) ASEAN. D) None of above. Show Answer Correct Answer: A) European Union. 20. One reason country's choose to overvalue their currency is: A) Increased export competitiveness. B) Greater employment is domestic industries. C) Cheaper imports. D) None of above. Show Answer Correct Answer: C) Cheaper imports. 21. Out of the following, which investment has the highest return but also the highest risk? A) Savings Account. B) Bonds. C) CDs. D) Stock. Show Answer Correct Answer: D) Stock. 22. Who propounded the theory of comparative costs? A) Ricardo. B) Haberler. C) Adam Smith. D) None of above. Show Answer Correct Answer: A) Ricardo. 23. What is the term for the ability of a country or a company to produce a particular good or service at a lower marginal and opportunity cost over another? A) Absolute advantage. B) Trade balance. C) Opportunity cost. D) Comparative advantage. Show Answer Correct Answer: D) Comparative advantage. 24. The U.S. only allows 1 million oranges to be imported from other countries. A) Tariff. B) Import Quota. C) Embargo. D) None of them. Show Answer Correct Answer: B) Import Quota. 25. Only producing certain goods instead of everything you need is known as A) Importing. B) Balance of trade. C) Absolute advantage. D) Specialization. Show Answer Correct Answer: D) Specialization. 26. ..... is the concentration of the productive efforts of individuals and firms on a limited number of activities. A) Exchange rates. B) Exports. C) Specialization. D) Imports. Show Answer Correct Answer: C) Specialization. 27. Lop-sided economic development of a country is not at all desirable A) False. B) True. Show Answer Correct Answer: B) True. 28. Which of these four are *NOT* the most important trading partners for the United States A) China. B) Canada. C) Mexico. D) Russia. Show Answer Correct Answer: D) Russia. 29. If a tariff and import quota lead to equivalent increases in the domestic price of steel, then: A) The quota results in efficiency reductions but the tariff does not. B) The tariff results in efficiency reductions but the quota does not. C) They have identical impacts on how much is produced and consumed. D) They have identical impacts on how income is distributed. Show Answer Correct Answer: C) They have identical impacts on how much is produced and consumed. 30. Quotas are government imposed limits on the ..... of goods trade between countries. A) Costs. B) Revenue. C) Prices. D) Quantity. Show Answer Correct Answer: D) Quantity. ← PreviousNext →Related QuizzesEconomics QuizzesFinance QuizzesInternational Economics Quiz 1International Economics Quiz 2International Economics Quiz 3International Economics Quiz 4International Economics Quiz 5International Economics Quiz 6International Economics Quiz 7International Economics Quiz 8 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books