This quiz works best with JavaScript enabled. Home > Finance > Economics > International Economics > International Trade > International Trade – Quiz 104 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books International Trade Quiz 104 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. When merchanidse is moved or shipped, it's called ..... A) Cargo. B) Freight. C) Both are correct. D) None of above. Show Answer Correct Answer: C) Both are correct. 2. If he forgot to pay his rent, his landlady would send him a ..... A) Reservation. B) Precaution. C) Invoice. D) Reminder. Show Answer Correct Answer: D) Reminder. 3. ..... argues that dynamic gains from trade may not always be beneficial. A) Adam Smith. B) David Ricardo. C) Paul Samuelson. D) Heckscher-Ohlin. Show Answer Correct Answer: C) Paul Samuelson. 4. Which concept explains why countries trade even if they have an absolute advantage in producing all goods? A) Balance of trade. B) Tariffs. C) Opportunity cost. D) Comparative advantage. Show Answer Correct Answer: D) Comparative advantage. 5. The producer that can produce the most output compared to any other nation. A) Trade Offs. B) Absolute Advantage. C) Opportunity Cost. D) Comparative Advantage. Show Answer Correct Answer: B) Absolute Advantage. 6. A negative balance of trade would ultimately lead to A) Creation of job opportunities. B) Development of economy. C) Exhaustion of country's financial resources. D) Increase in foreign exchange reserves. Show Answer Correct Answer: C) Exhaustion of country's financial resources. 7. If the pound is described as weak who benefits? A) Small Businesses. B) Large Businesses. C) Importing Businesses. D) Exporting Businesses. Show Answer Correct Answer: D) Exporting Businesses. 8. Comparative advantage focus on the relative productivity differences, absolute advanatage looks at the absolute productivity A) TRUE. B) FALSE. Show Answer Correct Answer: A) TRUE. 9. Trade agreements help reduce barriers between nations for the benefit of the involved countries A) True. B) False. Show Answer Correct Answer: A) True. 10. Define trade deficit. A) An economic condition where a country imports more goods and services than it exports. B) An economic condition where a country imports and exports an equal amount of goods and services. C) An economic condition where a country does not import or export any goods or services. D) An economic condition where a country exports more goods and services than it imports. Show Answer Correct Answer: A) An economic condition where a country imports more goods and services than it exports. 11. ..... decrease in the value of a currency relative to other currencies. If the value of the dollar decreases, it means that Americans can't buy as much when they travel or imports products. A) Appreciation. B) Import quotas. C) Depreciation. D) Trade barriers. Show Answer Correct Answer: C) Depreciation. 12. When was WTO established? A) 1 January 1948. B) 1 January 1947. C) 1 January 1995. D) 1 January 1994. Show Answer Correct Answer: C) 1 January 1995. 13. It is one of the most famous ancient trading route. This route connected China and Ancient Roman Empire. A) Silk Road. B) Spice Route. C) Salt Route. D) None of above. Show Answer Correct Answer: A) Silk Road. 14. Lack of technology forced the country to A) Exporting goods and services. B) Importing goods and services. Show Answer Correct Answer: B) Importing goods and services. 15. Duties imposed on imports A) Excise duty. B) Custom duty. C) Tariffs. D) None. Show Answer Correct Answer: C) Tariffs. 16. Name one disadvantage of international trade. A) Job loss in domestic industries. B) Increased competition. C) Decreased national security. D) Loss of cultural identity. Show Answer Correct Answer: A) Job loss in domestic industries. 17. The manufacturing and/or sale of goods and/or services to satisfy the wants and needs of consumers to make a profit is: A) Tariff. B) International. C) Domestic. D) Business. Show Answer Correct Answer: D) Business. 18. To correct an adverse balance of payments, a government may A) Reduce import tax. B) Increase the money supply. C) Increase exports. D) Reduce credits. Show Answer Correct Answer: C) Increase exports. 19. Protects infant industries, hurts domestic workers, labor standards are not the same, and to protect national security. A) Arguments for free trade. B) Arguments against free trade. Show Answer Correct Answer: B) Arguments against free trade. 20. What is the impact of international trade on the efficiency and prices of goods and services, and how does it relate to the standard of living for people in different countries? A) International trade allows countries to specialize in the production of goods and services in which they have a comparative advantage, leading to increased efficiency and lower prices. This, in turn, can lead to higher standards of living for people in different countries. B) International trade leads to higher prices and lower efficiency in production. C) International trade has no impact on the standard of living for people in different countries. D) International trade only benefits one country and harms others. Show Answer Correct Answer: A) International trade allows countries to specialize in the production of goods and services in which they have a comparative advantage, leading to increased efficiency and lower prices. This, in turn, can lead to higher standards of living for people in different countries. 21. Which method of protection always reduces the supply of an imported good to zero? A embargo B quota C subsidy D tariff A) C. B) D. C) A. D) B. Show Answer Correct Answer: C) A. 22. A trade barrier that sets a legal limit of imports A) Tariff. B) Quota. C) Embargo. D) Subsidy. Show Answer Correct Answer: B) Quota. 23. What is the main difference between a trade surplus and a trade deficit? A) The main difference is that a trade surplus occurs when a country exports more than it imports, while a trade deficit occurs when a country imports more than it exports. B) A trade surplus occurs when a country exports and imports the same amount, while a trade deficit occurs when a country has no imports. C) There is no difference between a trade surplus and a trade deficit. D) A trade surplus occurs when a country imports more than it exports, while a trade deficit occurs when a country exports more than it imports. Show Answer Correct Answer: A) The main difference is that a trade surplus occurs when a country exports more than it imports, while a trade deficit occurs when a country imports more than it exports. 24. It means by which trade between countries is restricted in some way-normally through measures to reduce the number of imports coming into a country. A) Protectionism. B) Rhetoric. C) Quotas. D) Tariff. Show Answer Correct Answer: A) Protectionism. 25. Tariffs are ..... A) Taxes. B) Limits. C) Discounts. D) Financial supports. Show Answer Correct Answer: A) Taxes. 26. ..... investing by setting up operations or buy assets in businesses in another country A) FII (Foreign Institutional Investment). B) FUI(foreign Unit Investment). C) FDI (Foreign Direct Investment). D) FOI (Foreign Overseas Investment). Show Answer Correct Answer: C) FDI (Foreign Direct Investment). 27. Business broadly refers to transactions ranging in complexity from the exchange of baseball cards between collectors to multinational policies setting protocols for imports andexports between countries. A) FALSE. B) TRUE. Show Answer Correct Answer: A) FALSE. 28. This approach is often summarized by the maxim "when in Rome do as Romans do" A) Naive immoralist. B) Righteous moralist. C) Cultural relativism. D) None of above. Show Answer Correct Answer: C) Cultural relativism. 29. These ports which originally developed as points on main sea routes where ships used to anchor for refuelling, watering and taking food items. A) Inland ports. B) Out Ports. C) Entrepot Ports. D) Ports of call. Show Answer Correct Answer: D) Ports of call. 30. When the government places a tax on an imported good to protect a domestic good. A) Subsidy. B) Comparative Advantage. C) Quota. D) Protective tariff. Show Answer Correct Answer: D) Protective tariff. ← 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