International Trade and Balance of Payments Quiz
Explore key concepts in international trade and balance of payments. Test your understanding with questions on tariffs, trade theories, and more!
#1
Which of the following is a key component of international trade?
Supply and demand
Price elasticity
Comparative advantage
Monopoly power
#2
Which of the following represents a country's current account balance?
Exports minus imports of goods and services
Investment income plus transfers
Foreign direct investment
Government spending on imports
#3
What is the purpose of a 'balance of payments'?
To ensure equal trade between nations
To measure the flow of goods and services between countries
To track all financial transactions between a country and the rest of the world
To regulate exchange rates in the international market
#4
What is the primary objective of trade liberalization?
To promote protectionism
To reduce government intervention in trade
To increase trade barriers
To encourage subsidies for domestic industries
#5
What is the term for the difference between a country's total exports and total imports?
Trade balance
Current account balance
Capital account balance
Financial account balance
#6
What does the term 'tariff' refer to in international trade?
A tax imposed on imports or exports
A restriction on the quantity of goods traded
A subsidy given to domestic producers
An agreement between nations to eliminate trade barriers
#7
Which international organization is primarily responsible for overseeing trade agreements?
World Trade Organization (WTO)
International Monetary Fund (IMF)
United Nations (UN)
Organization for Economic Cooperation and Development (OECD)
#8
What is the concept of 'dumping' in international trade?
Exporting goods below their production cost to gain market share
Imposing high tariffs on imports to protect domestic industries
Trading goods with neighboring countries without tariffs
The process of reducing trade barriers through negotiations
#9
Which of the following is a non-tariff barrier to trade?
Quotas
Embargoes
Subsidies
Dumping
#10
What is the main function of the International Monetary Fund (IMF) in the context of international trade?
Negotiating trade agreements between countries
Providing financial assistance to countries facing balance of payments problems
Setting international standards for product quality
Promoting regional economic integration
#11
What is the J-curve effect in the context of a country's trade balance?
A rapid increase in imports followed by a gradual increase in exports
A temporary worsening of the trade balance before it improves after a currency depreciation
A situation where trade deficits persist despite currency devaluation
A long-term pattern of trade surplus followed by a sharp decline in exports
#12
Which of the following trade theories emphasizes the importance of economies of scale?
Absolute advantage
Comparative advantage
Heckscher-Ohlin model
New trade theory
#13
Which trade theory suggests that countries tend to export goods that intensively use factors of production that are locally abundant?
Absolute advantage
Comparative advantage
Heckscher-Ohlin model
New trade theory
Sign In to view more questions.
Quiz Questions with Answers
Forget wasting time on incorrect answers. We deliver the straight-up correct options, along with clear explanations that solidify your understanding.
Popular Quizzes in International Trade
Popular Quizzes in Economics
Report