International Trade and Exporting Quiz

Trade deficit is the negative balance resulting from a country's exports being less than its imports.

WTO stands for World Trade Organization, a global body that regulates international trade and resolves trade disputes.

A trade surplus occurs when a country exports more goods and services than it imports, resulting in a positive balance.

The IMF, or International Monetary Fund, aims to foster cooperation on monetary policy and exchange rates among member countries.

A letter of credit in international trade primarily facilitates secure and guaranteed payment between the buyer and seller.

A tariff is a tax imposed on imported goods, serving as a trade barrier to protect domestic industries.

A free trade agreement is a pact between countries to reduce or eliminate trade barriers, promoting free flow of goods and services.

Balance of trade refers to the difference between a country's total exports and total imports of goods.

FOB, or Free On Board, is a shipping term indicating that the seller is responsible for goods until they are loaded onto the transport.

'Dumping' in international trade refers to selling goods below cost in a foreign market, often to gain a competitive advantage.

Comparative advantage theory suggests countries should focus on producing goods efficiently and trade to obtain items they can't produce as efficiently.

Mercantilism is the economic principle advocating for a nation to export more than it imports to accumulate wealth and power.

A 'force majeure' clause in an international trade contract addresses unforeseen events beyond control that may affect the contract's performance.

The main purpose of the General Agreement on Tariffs and Trade (GATT) is to promote global trade by reducing barriers and tariffs.

Intentional limitation of exported goods by a country is termed as a 'quota' in international trade.