This quiz works best with JavaScript enabled. Home > Finance > Economics > International Economics > International Trade > International Trade – Quiz 3 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books International Trade Quiz 3 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Which economic theory suggests that a country should specialize in producing goods? A) Comparative advantage. B) Protectionism. C) Absolute advantage. D) Balance of trade. Show Answer Correct Answer: C) Absolute advantage. 2. Which mean is more expensive? A) By Air. B) By Ocean. C) By Truck. D) None of above. Show Answer Correct Answer: A) By Air. 3. Raw materials proper from Colombia are definitely not A) Sugar cane, cocoa, coffee and emeralds. B) Rice, weat, flowers and oil. C) Iron, corn, tuna and cotton. D) Oil, coffee, flowers and emeralds. Show Answer Correct Answer: C) Iron, corn, tuna and cotton. 4. Which of the following is not a disadvantage of International Trade A) Exchange rates increasing costs. B) Reduced Risks of falling sales. C) Local taxes and laws creating additional costs. D) Problems with supply chains could delay production of products. Show Answer Correct Answer: B) Reduced Risks of falling sales. 5. The primary focus of the Trade-Weighted Value of the Dollar is to: A) Evaluate the overall health of the economy. B) Determine the value of domestic goods. C) Measure the value of the U.S. dollar against a basket of currencies. D) Set exchange rates between countries. Show Answer Correct Answer: C) Measure the value of the U.S. dollar against a basket of currencies. 6. The following differences give rise to international trade: A) Availability of factors of production. B) Socio-economic. C) Geographical. D) All of the Above. Show Answer Correct Answer: D) All of the Above. 7. Companies that sell products from within the country to abroad are called..... A) Kurir. B) Importer. C) Exporter. D) All answers are correct. Show Answer Correct Answer: C) Exporter. 8. The agency that was created to police the General Agreement on Tariffs and Trade (GATT)? A) United Nations Trade Group. B) U.S. Customs Services. C) Federal Trade Commission. D) World Trade Organization. Show Answer Correct Answer: D) World Trade Organization. 9. Country A sells goods to Country C. Country A acts as..... A) Exporter. B) Importer. Show Answer Correct Answer: A) Exporter. 10. Goods and services a country produces and sells to other countries A) Imports. B) Exports. C) Demand. D) Supply. Show Answer Correct Answer: B) Exports. 11. A J curve suggests that: A) Imports and exports are price inelastic in the short run but elastic in the long run. B) Imports and exports are price inelastic in the short run and in the long run. C) Imports and exports are price elastic in the short run and in the long run. D) Imports and exports can be either price inelastic or price elastic. Show Answer Correct Answer: A) Imports and exports are price inelastic in the short run but elastic in the long run. 12. The WTO is a global organization that helps A) Eliminate world hunger. B) Promote world peace. C) Negotiate global trade agreements and resolve trade disputes. D) All of these. Show Answer Correct Answer: C) Negotiate global trade agreements and resolve trade disputes. 13. Which of the following is least risky? A) Export. B) Joint venture. C) Wholly owned subsidiary. D) All have same risk. Show Answer Correct Answer: A) Export. 14. If the seller and buyer agree that the transaction will be paid in full by the buyer at a later date on the agreed date, the payment method is called..... A) Letter of Credit. B) Advance Payment. C) Open Account. D) Documentary Collection. Show Answer Correct Answer: C) Open Account. 15. Which of these are negative impacts of a multinational company? A) Tax advantages. B) Laws in other countries may be different. C) Lower production costs. D) Purchasing Economies of Scale. Show Answer Correct Answer: B) Laws in other countries may be different. 16. What is the main benefit of international trade in terms of consumer choice? A) Reduced access to goods and services. B) Limited variety of products. C) Increased consumer choices and access to a variety of goods. D) Higher prices for goods. Show Answer Correct Answer: C) Increased consumer choices and access to a variety of goods. 17. An economy will be indifferent as to what goods that will be produced when the relative price of that good is ..... to its opportunity cost. A) Inverse. B) Equal. C) Constant. D) Proportional. Show Answer Correct Answer: B) Equal. 18. Why are quotas an example of protectionism? A) Quotas increase the volume of trade. B) Quotas remove restrictions on trade. C) Quotas ignore the needs of domestic industries. D) Quotas create trade barriers by limiting imports. Show Answer Correct Answer: D) Quotas create trade barriers by limiting imports. 19. Many engineers of the 1970s made great computers, but only a few were, , , , , , enough to see the business possibilities in the new machines A) Intrepid. B) Shuttle. C) Entrepreneurial. D) Haggle. Show Answer Correct Answer: C) Entrepreneurial. 20. Deals with the rules of trade between nations, reduce trade barriers such as tariffs and quotas A) World Bank. B) World Trade Organization. C) International Monetary Fund. D) None of above. Show Answer Correct Answer: B) World Trade Organization. 21. The first fur products are made from cat's fur. A) FALSE. B) TRUE. Show Answer Correct Answer: A) FALSE. 22. Trade barrier which imposes extra cost on imports to protect local businesses A) Flexible Exchange Rate. B) Fixed Exchange Rate. C) Protectionism. D) Exchange Control. Show Answer Correct Answer: C) Protectionism. 23. What is the most likely effect of a United States import quota on foreign cars? A) The price of domestic cars would decrease because of improved production methods. B) Foreign automobile manufacturers would be allowed to sell more cars in the United States. C) Domestic automobile manufacturers would sell more cars in markets in the United States. D) The price of cars would increase in foreign countries because of the trade restrictions. Show Answer Correct Answer: C) Domestic automobile manufacturers would sell more cars in markets in the United States. 24. Payments or other support like tax breaks from governments to businesses A) Subsidy. B) Tariff. C) Embargo. D) Standard. E) Quota. Show Answer Correct Answer: A) Subsidy. 25. What is the basis of trade? A) Comparative advantage. B) Interdependence. C) Specialization. D) Absolute advantage. Show Answer Correct Answer: C) Specialization. 26. The activity of trying to persuade someone in authority, usually an elected memberof a government or an organization, to support laws or rules that give your institution or industry an advantage: A) Lobbying. B) Merchandising. C) Partnership. D) Profits. Show Answer Correct Answer: A) Lobbying. 27. How many Starbucks stores were opened across Australia by the year 2000? A) 69. B) 87. C) 55. D) 13. Show Answer Correct Answer: B) 87. 28. The purpose of dumping is A) To get rid of unwanted products for a cheap price. B) To gain a high market share. C) To improve the quality of the good. D) To lower the wages of the employees. Show Answer Correct Answer: B) To gain a high market share. 29. Imports increase and are cheaper for consumers to buy. A) Depreciation. B) Appreciation. Show Answer Correct Answer: B) Appreciation. 30. Tools, equipment, or other manufactured goods used to produce other goods and services are known as: A) Consumer Goods. B) Specialized Goods. C) Capital Goods. D) Services. Show Answer Correct Answer: C) Capital Goods. ← PreviousNext →Related QuizzesInternational Economics QuizzesEconomics QuizzesInternational Trade Quiz 1International Trade Quiz 2International Trade Quiz 4International Trade Quiz 5International Trade Quiz 6International Trade Quiz 7International Trade Quiz 8International Trade Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books