This quiz works best with JavaScript enabled. Home > Finance > Economics > International Economics > International Trade > International Trade – Quiz 12 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books International Trade Quiz 12 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. At the industry's long-run equilibrium, companies in monopolistic competition will earn ..... economic profit. A) Negative. B) Zero. C) Undefined. D) Positive. Show Answer Correct Answer: B) Zero. 2. Which one gives additional revenue to the government? A) Dumping. B) Import tariff. C) Import quota. D) None of above. Show Answer Correct Answer: B) Import tariff. 3. A numerical limit placed on goods being imported A) Tariff. B) Embargo. C) Quota. D) None of above. Show Answer Correct Answer: C) Quota. 4. How could a country prevent a more efficient firm in another country from selling its televisions at a price below that of their country's firms? A) They could threaten to go to war if the foreign firm did not raise their prices. B) They could pass laws forcing their firms to sell at a loss. C) They could either subsidize their firms or place tariffs on the imported televisions. D) The could order their firms to produce extra televisions so that there would be a surplus and prices would drop below the price of the foreign imports. Show Answer Correct Answer: A) They could threaten to go to war if the foreign firm did not raise their prices. 5. What does FTA stand for in international trade? (Free Trade Agreement) A) Fair Trade Agreement. B) Foreign Trade Association. C) Free Trade Agreement. D) Federal Transportation Authority. Show Answer Correct Answer: C) Free Trade Agreement. 6. A prohibition on the import or export of a good to or from another country. A) Tariff. B) Embargo. C) Quota. D) None of above. Show Answer Correct Answer: B) Embargo. 7. A visible import is ..... A) A physical good that has been brought in from another country. B) A service that has been sold to another country. C) A physical good that has been sold to another country. D) A service that has been brought in from another country. Show Answer Correct Answer: A) A physical good that has been brought in from another country. 8. Why is it not realistic for a country to solely focus on producing a single good? A) Because technology remains constant and does not improve. B) Because not all resources in a country are suited for producing a single good. C) Because the cost of shipping a product can sometimes be so high that it cancels out any advantage it may have had. D) Because obtaining perfect information about prices, costs, and productivity of all goods and services in large global markets is almost impossible. Show Answer Correct Answer: B) Because not all resources in a country are suited for producing a single good. 9. ..... ? ..... Imports, for instance, become more expensive, pushing up cost of many goods for everyday Americans. Companies that require imports have to pay more, increasing the costs of manufacturing. Americans planning on traveling abroad, likewise, will pay more than they otherwise would. A) Strong dollar. B) Weak dollar. Show Answer Correct Answer: B) Weak dollar. 10. Balance of payment is measured as A) Difference between visible items of exports and imports. B) Difference between invisible items of exports and imports. C) Difference between external and internal flow of gold. D) Difference between all receipts of foreign exchange and payment of foreign exchange. Show Answer Correct Answer: D) Difference between all receipts of foreign exchange and payment of foreign exchange. 11. What is a reason for trade protection? A) To reduce economic growth. B) To reduce a deficit on the current account of the balance of payments. C) To reduce inflation. D) To reduce a surplus on the current account of the balance of payments. Show Answer Correct Answer: B) To reduce a deficit on the current account of the balance of payments. 12. Indonesia's cooperation with developed countries provides opportunities for the younger generation to become knowledgeable and proficient in the field of technology. From the illustration, the benefits of international trade are..... A) Earn foreign exchange. B) Stabilize prices. C) Expand job opportunities. D) Accelerate technology transfer. Show Answer Correct Answer: D) Accelerate technology transfer. 13. The equilibrium real interest rate in US increases to 5 percent while the equilibrium real interest rate in China remains at 3 percent. As a result, financial capital will flow from A) US to China, increasing the interest rate in China and decreasing the interest rate in US. B) US to Britain, decreasing the interest rate in Britain and increasing the interest rate in US. C) China to US increasing the interest rate in China and decreasing the interest rate in US. D) China to US, decreasing the interest rate in China and decreasing the interest rate in US. E) China to US, decreasing the interest rate in China and increasing the interest rate in US. Show Answer Correct Answer: C) China to US increasing the interest rate in China and decreasing the interest rate in US. 14. Australia has played an instrumental role in achieving recent WTO outcomes, such as the Trade Facilitation Agreement. A) True. B) False. Show Answer Correct Answer: A) True. 15. All of the following are means to restrict international trade EXCEPT: A) Tariffs. B) Quotas. C) Import Licenses. D) Trade Deficits. Show Answer Correct Answer: D) Trade Deficits. 16. McDonalds is an example of ..... A) Import. B) Export. C) Licensing. D) Franchising. Show Answer Correct Answer: D) Franchising. 17. How does foreign ownership of land and houses affect Australians? A) It decreases asset prices and makes it easier for Australians to buy their own home. B) It increases asset prices and makes it more difficult for Australians to buy their own home. C) It has no impact on asset prices and home ownership. D) It leads to reduced travel times and less congestion within families. Show Answer Correct Answer: B) It increases asset prices and makes it more difficult for Australians to buy their own home. 18. Which of the following is a condition of Dunning's eclectic theory? A) The firm must own a competitive advantage that overcomes competing against foreign firms in their markets. B) Research and development costs must outweigh expenses related to foreign direct investment. C) The firm must benefit more from outsourcing a service than controlling a foreign business. D) Business activity must be more profitable in a domestic location than in a foreign location. Show Answer Correct Answer: A) The firm must own a competitive advantage that overcomes competing against foreign firms in their markets. 19. Who has the Comparative advantage in Tea? A) Peru. B) Neither. C) Unknown. D) Colombia. Show Answer Correct Answer: D) Colombia. 20. Limiting the amount of an export into the country ..... A) Fair Trade. B) Embargo. C) Quota. D) Free trade. Show Answer Correct Answer: C) Quota. 21. When does the relative prices of goods becomes equal to their relative unit labor requirements? A) In the operation of international trade. B) In the promotion of international trade. C) In the absence of international trade. D) In the presence of international trade. Show Answer Correct Answer: C) In the absence of international trade. 22. Clay pots made in Arizona are used by families in India. A) Export. B) Import. Show Answer Correct Answer: A) Export. 23. When real exchange rate increases then A) The export will fall. B) The import will decrease. C) The net export will rise. D) None of above. Show Answer Correct Answer: A) The export will fall. 24. Promote the development of the manufacturing industry in Malaysia, it is also the provision of medium and long term loans. A) MATRADE. B) GATT. C) MIDF. D) WHAT. Show Answer Correct Answer: C) MIDF. 25. The producer that can produce the most output OR requires the least amount of inputs (resources) A) Trade Offs. B) Opportunity Cost. C) Absolute Advantage. D) Comparative Advantage. Show Answer Correct Answer: C) Absolute Advantage. 26. How were different cultures and philosophies discovered A) Because China sent large amounts of silk along this road. B) Through people connecting with each other. C) Because it is made of many routes. D) Because they carried precious goods and the roads weren't safe. E) Because the roads were dangerous and nature was hard. Show Answer Correct Answer: B) Through people connecting with each other. 27. A newspaper reported that exports from Sweden remained low for five months as changes in the rate of exchange meant that Swedish goods became more expensive to buy abroad. What else would be likely to happen? A Imported goods would become cheaper in Sweden. B Swedish people would switch to buying home-produced goods. C The Swedish balance of payments would improve. D The Swedish balance of trade would improve. A) D. B) B. C) A. D) C. Show Answer Correct Answer: C) A. 28. There are many different countries that trade goods and services, so a(n) ..... is established. A) Translator agreement. B) Currency exchange. C) Border. D) Tariff agreement. Show Answer Correct Answer: B) Currency exchange. 29. Which country is the world's largest importer? A) Russia. B) China. C) United States of America. D) England. Show Answer Correct Answer: C) United States of America. 30. Which country is the United States biggest import partner? A) Russia. B) Mexico. C) China. D) Japan. Show Answer Correct Answer: C) China. ← 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