#1
Which of the following is an example of a trade barrier?
Tariff
ExplanationTariff is a tax imposed on imported goods, acting as a trade barrier by increasing their cost.
#2
What does NAFTA stand for?
North American Free Trade Agreement
ExplanationNAFTA stands for North American Free Trade Agreement, facilitating trade among North American countries.
#3
What is the name of the agreement that replaced GATT and came into effect in 1995?
World Trade Organization (WTO)
ExplanationThe World Trade Organization (WTO) succeeded GATT in 1995, modernizing and expanding global trade regulations.
#4
Which international organization regulates trade rules among countries?
World Trade Organization
ExplanationThe World Trade Organization (WTO) oversees and enforces global trade rules among member countries.
#5
What is the primary function of the European Union?
Economic integration
ExplanationThe European Union's primary function is economic integration, promoting collaboration and trade among member nations.
#6
What is the main purpose of the General Agreement on Tariffs and Trade (GATT)?
To reduce barriers to international trade
ExplanationGATT aims to decrease barriers to international trade, fostering a more open and fair global trading system.
#7
Which economic theory suggests that countries should specialize in the production of goods and services they can produce most efficiently and trade with other countries for goods and services they cannot produce as efficiently?
Comparative advantage
ExplanationComparative advantage theory advocates for countries specializing in efficient production and trading for mutually beneficial outcomes.
#8
What term describes the integration of national economies into the international economy through trade, foreign direct investment, capital flows, migration, and the spread of technology?
Globalization
ExplanationGlobalization refers to the interconnectedness of national economies through various international factors.
#9
What is the term for a situation where a country's currency is deliberately devalued to make its exports cheaper and imports more expensive?
Currency manipulation
ExplanationCurrency manipulation involves intentionally devaluing a country's currency to gain a trade advantage by making exports more affordable and imports costlier.