1. If a nation has an open economy it means that the nation:
Correct : D. Conducts trade with other countries
2. The term Euro Currency market refers to
Correct : B. The market where the borrowing and lending of currencies take place outside the country of issue
3. Dumping refers to:
Correct : B. Sale of goods abroad at low a price, below their cost and price in home market
4. International trade and domestic trade differ because of:
Correct : D. All of the above
5. Market in which currencies buy and sell and their prices settle on is called the
Correct : C. Foreign exchange market
6. Which one is not associated with the UNO
Correct : C. ASEN
7. International Labor Organization is agency of
Correct : D. United Nations
8. Headquarter of International Labor organization is located in
Correct : A. Geneva
9. General Agreement on Tariffs and Trade (GATT) went into effect?
Correct : B. 1948
10. Which of the following is the main objective behind the establishment of WTO
Correct : D. All of them
11. International Labor Organization received nobel Peace Prize in
Correct : B. 1969
12. " Term of trade " between two countries refer to a ratio of
Correct : A. Export prices to import prices
13. When was GATT replaced with WTO?
Correct : C. 1995
14. WTO comes as the third economic pillar of world-wide dimensions along
Correct : A. International Monetary Funds
15. Gold standard means
Correct : D. (A) and (C)
16. Underlying the application of the monopolistic competition model to
Correct : A. increases market size
17. Which of the following trade policies limits specified quantity of goods to be
Correct : A. Quota
18. In the 2-factor, 2 good Heckscher-Ohlin model, the two countries differ in
Correct : C. relative availabilities of factors of production
19. Since 1980s which of the following changes has happened in the world trade?
Correct : D. all of the above
20. According to Ricardo, a country will have a comparative advantage in:
Correct : C. Industries that sell to domestic and foreign buyers
21. If a country has a linear (downward sloping) production possibilities
Correct : A. constant opportunity costs
22. Boeing aircraft company was able to cover its production costs of the first
―jumbo jetǁ in the seventies because Boeing could market it to several foreign airlines in addition to domestic airlines. This illustrates:
Correct : A. How economies of scale make possible a larger variety of products in international trade.
23. Wassily Leontief used an input-output table in order to test the
Correct : B. Heckscher Ohlin theory of comparative
24. Which of the following is one of the conclusions of New Trade Theory
Correct : C. Consumers gain from the increased variety of goods that trade makes
25. .A tax of 20 cents per unit of imported cheese would be an example of a (an):
Correct : D. Specific tariff
26. According to the argument for protection, tariffs can shield new industries from import competition until they have grown strong and efficient enough to withstand the competition by foreign producers.
Correct : B. Infant industry argument
27. Ad valorem tariffs are collected as
Correct : B. a percentage of the price of the product
28. Which of the following does not form part of current account under balance of
Correct : D. Capital receipts and payments
29. Gifts and Relief are
Correct : D. Transfer payment
30. A country is said to be in debt trap if
Correct : B. It is required to borrow money to make interest payments on outstanding loans
31. The effective rate of protection
Correct : D. shows the increase in value added for domestic production that a particular tariff structure makes possible, in percentage terms
32. Which type of tariff is expressly forbidden by the U.S. Constitution?
Correct : B. Export tariff
33. Arguments for free trade are sometimes disregarded by politicians because:
Correct : B. Maximizing consumer welfare may not be a chief priority
34. Technological improvements are similar to international trade since they both:
Correct : B. increase the nation aggregate income
35. A widely used indicator to differentiate developed countries from developing
Correct : B. real income per capita
36. All of the following are debit items in the balance of payments, except:
Correct : B. merchandise exports
37. The role of ----------- is to direct one nation's saving into another nation
Correct : D. capital flows
38. The current account includes
Correct : D. all of the above
39. A current account surplus implies that
Correct : A. the country is a net lender to the rest of the world