This quiz works best with JavaScript enabled. Home > Finance > Economics > International Economics > International Trade > International Trade – Quiz 45 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books International Trade Quiz 45 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. According to the method of payment as cheque payment, what are the role of banks? A) (A) Money transfer. B) (B) Document handling. C) (C) Payment guarantee. D) Only (A). E) Only (A) & (B). Show Answer Correct Answer: D) Only (A). 2. Theory of comparative advantage was given by ..... A) Mr. David Ricardo. B) B. Adam Smith. C) C. Peter Drucker. D) A. Philip Kotler. Show Answer Correct Answer: A) Mr. David Ricardo. 3. If Brazil has a comparative advantage in producing rubber, and trade of rubber is allowed ..... A) It is impossible to determine whether Brazil will become an importer or an exporter of rubber without additional information about rubber prices. B) Brazil could become either an exporter or importer. C) Brazil will become an exporter of rubber. D) Brazil will become an importer of rubber. Show Answer Correct Answer: C) Brazil will become an exporter of rubber. 4. Trade within the same region or country A) World trade. B) Domestic trade. C) Free trade. D) Foreign trade. Show Answer Correct Answer: B) Domestic trade. 5. Which of the following is an example of an import for USA? A) America sells cell phones to India. B) Japan buys corn from USA. C) Brazil purchases plastic from USA. D) America buys foam fingers from China. Show Answer Correct Answer: D) America buys foam fingers from China. 6. The effect of the Fed buying bonds A) Increases money supply. B) Decreases money supply. Show Answer Correct Answer: A) Increases money supply. 7. Rancher Tom can raise 10 goats and 20 pigs in a year. Rancher Joe can raise 20 goats and 100 pigs in a year. Who has the comparative advantage for raising pigs? A) Rancher Tom. B) Rancher Joe. C) Both ranchers. D) Need more information. Show Answer Correct Answer: B) Rancher Joe. 8. If Country Alpha has been experiencing a higherinflation rate than Country Beta over the pastdecade, which of the following is true? A) Alpha's currency will have depreciatedrelative to Beta's currency. B) Alpha will have had lower nominal interestrates than Beta. C) Alpha will have had slower growth in themoney supply than Beta. D) Alpha's currency will have appreciatedrelative to Beta's currency. E) Alpha's economy will have grown at a fasterrate than Beta's. Show Answer Correct Answer: A) Alpha's currency will have depreciatedrelative to Beta's currency. 9. Established in January 1995 by the Uruguay round negotiations under GATT, the WTO included 144 nations as of ..... The WTO administers trade agreements, provides a forum for trade negotiations and resolving trade disputes, monitors trade policies, and provides technical assistance and training for developing countries. A) January 2001. B) January 2002. C) January 1999. D) January 2004. Show Answer Correct Answer: B) January 2002. 10. Why are trade policies difficult to reform, as per the text? A) They do not have any impact on the economy. B) They are not influenced by global efficiency. C) They bring dislocation to firms and industries. D) They are easy to implement. Show Answer Correct Answer: C) They bring dislocation to firms and industries. 11. Any product that is sold to the global market. A) Import. B) Global Trade. C) Export. D) International Trade. Show Answer Correct Answer: C) Export. 12. Brunei, Indonesia, Malaysia, Philippines, Singapore and Thailand. Vietnam are part of A) NAFTA. B) ASEAN. C) EU. D) None of above. Show Answer Correct Answer: B) ASEAN. 13. How do American consumers benefit from international trade? A) They have lower opportunity costs. B) They have a trade surplus that increases savings. C) They have access to goods that are scarce in this country. D) They have an absolute advantage in producing some goods. Show Answer Correct Answer: C) They have access to goods that are scarce in this country. 14. What role do government policies play in international trade? A) They have no influence on international trade. B) They can promote or restrict trade through regulations and policies. C) They only impact domestic markets, not international trade. D) They promote global economic inequality. Show Answer Correct Answer: B) They can promote or restrict trade through regulations and policies. 15. A letter from a bank guaranteeing that a buyer's payment to a seller will be received on time and for the correct amount A) Insurance Certificate. B) Manifest. C) Bill of Exchange. D) Letters of Credit. Show Answer Correct Answer: D) Letters of Credit. 16. When the U.S. stops importing products from another country after they find that there is a potential problem with the product. A) Trade embargo. B) Trade quota. C) Trade surplus. D) Trade tariff. Show Answer Correct Answer: A) Trade embargo. 17. Govt. policy about exports and imports is called: A) Commercial policy. B) Monetary policy. C) Finance policy. D) Fiscal policy. Show Answer Correct Answer: A) Commercial policy. 18. Name the five sectors of the economy A) Household, Business, Finance, Government, Overseas. B) Household, Business, Banks, Government, Overseas. C) Household, Government, Insurance, Firms, Imports/Exports. D) None of above. Show Answer Correct Answer: A) Household, Business, Finance, Government, Overseas. 19. Which of the following is a regional trading bloc in North America? A) NAFTA (now USMCA). B) ASEAN. C) European Union (EU). D) BRICS. Show Answer Correct Answer: A) NAFTA (now USMCA). 20. The followings are reasons for international trade EXCEPT A) Encourage opportunity in local direct investment. B) Make the market more competitive. C) Increase productivity. D) Increased efficiency. Show Answer Correct Answer: A) Encourage opportunity in local direct investment. 21. In a collection involving payment for an international trading transaction, the principal is the exporter and the drawee is the buyer/importer. A) False. B) True. Show Answer Correct Answer: B) True. 22. Is financially responsible (the buyer) for the receipt of a shipment. Generally, is the same as the receiver. A) Customs. B) Customer. C) Consignee. D) Exporter. Show Answer Correct Answer: C) Consignee. 23. Suppose the United States' grain prices are higher than world prices when it is isolated. Opening to trade would cause A) Lower world grain prices. B) Decreased producer surplus. C) Decreased social welfare. D) Lower domestic consumption. E) Higher domestic production. Show Answer Correct Answer: B) Decreased producer surplus. 24. ..... is a direct restriction on the quantity of some good that may beimported into a country. A) Import tariff. B) Import subsidy. C) Import quota. D) To the value of the tariff. Show Answer Correct Answer: C) Import quota. 25. Who introduced the concept of absolute advantage A) John Keynes. B) David Ricardo. C) Karl Marx. D) Adam Smith. Show Answer Correct Answer: D) Adam Smith. 26. Excessive burocratic procedures, lenghty processes and duplicated import steps, are examples of: A) Red tape. B) Regulatory barriers to trade. C) Corrupted environment. D) Tariff barriers to trade. Show Answer Correct Answer: A) Red tape. 27. Why is international trade not a zero-sum game? A) Because both parties in a trade transaction can benefit. B) Because one party always gains more than the other. C) Because the total value of goods traded remains the same. D) Because trade only benefits the exporting country. Show Answer Correct Answer: A) Because both parties in a trade transaction can benefit. 28. Internal economies of scale are those that A) Increase due to the growth of the industry as a whole. B) Reduce production costs in the short run. C) Result from changes in production techniques. D) Generate lower per unit production costs. Show Answer Correct Answer: D) Generate lower per unit production costs. 29. International trade enables the company to minimize the cost by employing cheaper labor. A) FALSE. B) TRUE. Show Answer Correct Answer: B) TRUE. 30. Which coordinates on a production possibility frontier graph are efficient? A) All points on the production possibility frontier. B) All points cont ained inside the production possibility frontier. C) All points beyond the production possibility frontier. D) The point on the production possibility frontier where the x-coordinate equals the y-coordinate. E) The two points where the production possibility frontier intersects the x-and y-axes. Show Answer Correct Answer: A) All points on the production possibility frontier. ← 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