#1
Which of the following is a characteristic of free trade?
Government intervention is minimal
ExplanationFree trade minimizes government intervention.
#2
Which international organization sets rules for global trade?
World Trade Organization (WTO)
ExplanationWTO establishes rules for global trade.
#3
In the context of international trade, what does the acronym NAFTA stand for?
North American Free Trade Agreement
ExplanationNAFTA: North American Free Trade Agreement.
#4
Which of the following is NOT a member of the European Union?
Switzerland
ExplanationSwitzerland is not an EU member.
#5
Which of the following is a characteristic of a centrally planned economy?
Government controls all economic activities
ExplanationCentrally planned economy: government controls all activities.
#6
What is the term for a tax imposed on imported goods?
Tariff
ExplanationTariff: tax on imported goods.
#7
What is the concept of 'comparative advantage' in economics?
When a country can produce a good using fewer resources than another country
ExplanationComparative advantage: producing with fewer resources.
#8
What is a 'trade deficit'?
When a country imports more than it exports
ExplanationTrade deficit: importing exceeds exporting.
#9
What is the main objective of protectionism in global trade?
To protect domestic industries from foreign competition
ExplanationProtectionism: shielding domestic industries.
#10
Which of the following is NOT a type of trade barrier?
Comparative advantage
ExplanationComparative advantage is not a trade barrier.
#11
Which economic theory suggests that a country should specialize in producing goods for which it has the lowest opportunity cost?
Comparative advantage
ExplanationSpecialization based on lowest opportunity cost: comparative advantage.
#12
What is the term for the difference between a country's total exports and total imports?
Current account balance
ExplanationCurrent account balance: exports minus imports.
#13
Which economic system relies on government control of all aspects of production and distribution?
Communism
ExplanationCommunism: government controls production.