This quiz works best with JavaScript enabled. Home > Finance > Economics > International Economics > International Economics – Quiz 32 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books International Economics Quiz 32 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Did you represent the theory of purchasing power parity? A) Ricardo Ricardo. B) Marshal Marshal. C) Jacob WeinerJacob Weiner. D) Castle Castle. Show Answer Correct Answer: D) Castle Castle. 2. When the pound appreciates A) Imports become cheaper. B) The current account balance should improve. C) Exports become cheaper. D) Exports won't change in price. Show Answer Correct Answer: A) Imports become cheaper. 3. An increase in the international value of United States dollar will tend to cause A) United States exports to fall. B) The national income of the United States to increase. C) Employment in the manufacturing sector of the United States to increase. D) The inflation rate in the United States to increase. E) The growth rate of the United States economy to increase. Show Answer Correct Answer: A) United States exports to fall. 4. Where is the headquarters of the WTO Located? A) New York. B) Austria. C) Washington DC. D) Geneva. Show Answer Correct Answer: D) Geneva. 5. What do you need to produce other goods and services? A) Nondurable goods. B) Gross Domestic Product (GDP). C) Consumer goods. D) Capital goods. Show Answer Correct Answer: D) Capital goods. 6. A system in which the exchange rates for currencies change as the supply of and demand for the currencies change. A) Flexible Rate of Exchange. B) Trade Wars. C) Foreign Exchange Rate. D) Protective Market. Show Answer Correct Answer: A) Flexible Rate of Exchange. 7. What is India's financial motto? A) Cash is king, digital is divine. B) Think big, cash bigger. C) Money talks, cash screams. D) 360$^\circ$ Finance. Show Answer Correct Answer: A) Cash is king, digital is divine. 8. Ban trade with a country usually due to political disputes A) Tariff. B) Subsidy. C) Quota. D) Embargo. Show Answer Correct Answer: D) Embargo. 9. Which of the following country is not the member of the ASEAN? A) Philippines. B) Cambodia. C) Mauritius. D) Laos. Show Answer Correct Answer: C) Mauritius. 10. The ability of one trading nation to make a product more efficiently than another trading nation. A) Absolute Disadvantage. B) Comparative Advantage. C) Law of Comparative Advantage. D) Absolute Advantage. Show Answer Correct Answer: D) Absolute Advantage. 11. A means of preventing a foreign product of service from freely entering a nation's territory. A) Trade Barrier. B) Trade Off. C) Trade Association. D) Trade War. Show Answer Correct Answer: A) Trade Barrier. 12. If the Balance of Payment of a country is adverse, then which institution will help that country? A) World Bank. B) International Monetary fund. C) Asian Development Bank. D) World Trade Organisation. Show Answer Correct Answer: B) International Monetary fund. 13. Ways to keep imported products out of a country by establishing rules and regulations on how they can be used or produced. A) Standard. B) Sanction. C) Tariff. D) Embargo. Show Answer Correct Answer: A) Standard. 14. A payment from the government to encourage or protect a certain economic activity is called a? A) Quota. B) Advantage. C) Tariff. D) Subsidy. Show Answer Correct Answer: D) Subsidy. 15. One of the predictions of the Heckscher-Ohlin model is that: A) Countries with different factor endowments but similar technologies and preferences will have a strong basis for trade with each other. B) Countries will tend to specialize, but not completely, in their comparative advantage good. C) Reciprocal demand leads to an equilibrium terms of trade by inducing changes in both demand and supply. D) All of the above. Show Answer Correct Answer: D) All of the above. 16. Export will ..... and import will ..... when local currency had undervalued. A) Decrease, increase. B) Increase, increase. C) Decrease, decrease. D) Increase, decrease. Show Answer Correct Answer: D) Increase, decrease. 17. That the division of labor is limited by the size of the market best applies to which explanation of trade: A) Factor endowment theory. B) Product life cycle theory. C) Economies of scale theory. D) Overlapping demand theory. Show Answer Correct Answer: C) Economies of scale theory. 18. Mill's Theory of reciprocal demand is a two by two model A) True. B) False. Show Answer Correct Answer: A) True. 19. This is a tax on imports that is used to increase price of foreign products and raise government revenue. A) Tariff. B) Embargo. C) Subsidy. D) Quota. Show Answer Correct Answer: A) Tariff. 20. ..... brings money into the country by sending products ..... the country. A) Imports; into. B) Exports; out of. C) Imports; out of. D) Exports; into. Show Answer Correct Answer: B) Exports; out of. 21. The balances of payments refer to ..... A) The balance of financial records showing the total inflow of money into the country. B) The balance of financial records showing the total money outflow paid to other countries. C) The balance of financial records showing the total export and import to other countries. D) The balance of financial records showing the total inflow of money into the country and the total money outflow paid to other countries. Show Answer Correct Answer: D) The balance of financial records showing the total inflow of money into the country and the total money outflow paid to other countries. 22. Balance of trade is the ..... A) Different between export and import of service. B) Total of export and import service. C) Different between export and import of goods. D) Total of export and import of goods. Show Answer Correct Answer: C) Different between export and import of goods. 23. Which of the following would benefit the most from protectionist policy? A) Big firms. B) Unemployed. C) Importers. D) Domestic industry. Show Answer Correct Answer: D) Domestic industry. 24. Which of the following economic factors is MOST LIKELY to support free trade? A) The United Steelworkers of America. B) The Anti-Globalization Coalition. C) US electronics producers. D) Coca-Cola Corporation. Show Answer Correct Answer: D) Coca-Cola Corporation. 25. Which of the following is the term used for the monthly payment on insurance policies? A) Charge. B) Term. C) Premium. D) Deductible. Show Answer Correct Answer: C) Premium. 26. The relationship between exchange rate and quantity demand of foreign currency is ..... A) Negative. B) Positive. Show Answer Correct Answer: A) Negative. 27. ..... favor trade barriers, where as ..... favor fewer (or no) trade restrictions. A) Embargos / Quotas. B) Absolute Advantage / Comparative Advantage. C) Protectionists / Free Traders. D) Subsidies / Tariffs. Show Answer Correct Answer: C) Protectionists / Free Traders. 28. According to Gravity model, we expect the United States to trade less with: A) Canada, Mexico. B) Bangladesh, Nepal. C) Germany. D) Japan, China. Show Answer Correct Answer: B) Bangladesh, Nepal. 29. This refers to free trade agreements among countries in a region. A) Trade agreement. B) Trading bloc. C) Trade Barriers. D) All of the above. Show Answer Correct Answer: B) Trading bloc. 30. A tax on imported goods and usually designed to protect domestic production of similar goods is A) Quota. B) Subsidy. C) Tariff. D) Embargo. Show Answer Correct Answer: C) Tariff. ← 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