Unit 6 - International Trade, Economics Systems

1.

Multiple Choice

45 sec

1 pt

Economist believe which of the following are benefits of international trade:

there can be increased consumption for all.

global production will be increased.

world resources will be used more efficiently.

all of these are true.

2.

Multiple Choice

1 min

1 pt

Comparative advantage explains why a nation will benefit from trade when:

it exports more than it imports.

its trading partners are experiencing offsetting losses.

it exports goods for which it is a high-opportunity cost producer, while importing those for which it is a low-opportunity cost producer.

it exports goods for which it is a low-opportunity cost producer, while importing those for which it is a high-opportunity cost producer.

3.

Multiple Choice

45 sec

1 pt

A country that can produce a good using fewer resources than another country has a(n):

lower opportunity cost of producing the good than another country.

absolute advantage.

specialization in the production of the good.

all of these.

4.

Multiple Choice

45 sec

1 pt

Embargos:

ban trade with other countries

generate tax revenues for that country

hurt domestic producers

lower prices of goods

5.

Multiple Choice

45 sec

1 pt

A tariff can be defined as a:

tax on imports.

tax on exports.

legal limit on imports.

legal limit on exports.

6.

Multiple Choice

45 sec

1 pt

The principal objective of WTO is to:

reduce the level of all tariffs and encourage trade

to increase tariffs on all imported goods

prevent the trading of services across nations' borders.

encourage countries to establish quotas.

7.

Multiple Choice

45 sec

1 pt

A restriction on the quantity of a good that can be imported into a country is a(n):

tariff.

quota.

embargo.

restricted exchange rate.

8.

Multiple Choice

45 sec

1 pt

NAFTA is a trade agreement between which of the following countries?

the United States, Cuba, and Brazil.

the United States, Canada, and Mexico.

the United States, Puerto Rico, and Cuba.

Brazil, Bolivia, Peru, and Columbia.

9.

Multiple Choice

45 sec

1 pt

The account which records a nation's foreign economic transactions is called the:

Trade Account.

T account.

Exchange Market.

Balance of Payments.

10.

Multiple Choice

45 sec

1 pt

An exchange rate is the number of units of:

a nation's money that is equal to one unit of another nation's money.

a nation's output that is equal to one unit of another nation's output.

gold backing a nation's money.

none of these.

11.

Multiple Choice

45 sec

1 pt

A market economy:

answers the What, How and For Whom questions the way they have always been answered

answers the What, How and For Whom questions by central authority

answers the What, How and For Whom questions using prices determined by the interaction of supply and demand

12.

Multiple Choice

45 sec

1 pt

A traditional economy:

answers the What, How and For Whom questions the way they have always been answered

answers the What, How and For Whom questions by central authority

answers the What, How and For Whom questions using prices determined by the interaction of supply and demand

13.

Multiple Choice

45 sec

1 pt

A command economy:

answers the What, How and For Whom questions the way they have always been answered

answers the What, How and For Whom questions by central authority

answers the What, How and For Whom questions using prices determined by the interaction of supply and demand

14.

Multiple Choice

45 sec

1 pt

In a command economy, the basic economic questions are answered by:

individuals and sellers

the traditional methods

central planners

none of these

15.

Multiple Choice

45 sec

1 pt

Who was know as the father of modern economics and believed in capitalism?

Karl Marx

Adam Smith

Robert Smith

Jeffrey Sachs

16.

Multiple Choice

45 sec

1 pt

Which economic system uses the "invisible hand theory"?

a traditional economy

a command economy

a market economy

a communist economy

17.

Multiple Choice

45 sec

1 pt

Which of the following is a characteristic of capitalism?

Equality of income.

Government decision-making is preferred to decentralized decision-making.

Market determination of prices and quantity.

Government ownership of all capital.

18.

Multiple Choice

45 sec

1 pt

Which of the following applies to a real-world socialistic economy?

Private ownership of all factors of production.

Government ownership of all factors of production.

Government ownership of most of the factors of production.

Lack of central planning.

19.

Multiple Choice

45 sec

1 pt

Karl Marx published which of the following books?

Das Kapital

General Theory of Communism

Wealth of Nations

Capitalist Manifesto

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