#1
Which organization facilitates negotiations and agreements between member countries on international trade policies?
World Trade Organization (WTO)
ExplanationWTO facilitates international trade negotiations and agreements.
#2
Which trade policy refers to the limitation on the quantity of a specific good that can be imported or exported during a particular time period?
Quota
ExplanationQuota restricts the amount of goods that can be imported or exported.
#3
Which term describes a situation where a country exports more goods and services than it imports?
Trade surplus
ExplanationTrade surplus occurs when exports exceed imports.
#4
What is the term used to describe an agreement between two or more countries to eliminate trade barriers among themselves while maintaining individual trade policies with non-member countries?
Free trade agreement
ExplanationFTAs eliminate trade barriers among member countries.
#5
Which of the following is NOT a motive for a government to impose trade barriers?
To promote international trade
ExplanationGovernments do not impose trade barriers to promote international trade.
#6
What is the main purpose of tariffs in international trade?
To restrict imports
ExplanationTariffs are imposed to limit the influx of foreign goods.
#7
Which of the following trade policies aims to protect domestic industries from foreign competition by imposing taxes on imports?
Tariffs
ExplanationTariffs safeguard domestic industries by taxing imports.
#8
What does NAFTA stand for in the context of international trade?
North American Free Trade Agreement
ExplanationNAFTA is the North American Free Trade Agreement.
#9
Which of the following is an example of a non-tariff barrier to trade?
Import quotas
ExplanationImport quotas are non-tariff barriers to trade.
#10
What is the most common currency used in international trade transactions?
US dollar
ExplanationThe US dollar is the predominant currency in international trade.
#11
What is the primary objective of trade liberalization?
To promote international trade
ExplanationTrade liberalization aims to boost global trade.
#12
What is Dumping in the context of international trade?
Exporting goods at a price lower than the production cost
ExplanationDumping involves selling goods below production cost in foreign markets.
#13
What is the purpose of a free trade agreement (FTA)?
To promote economic integration by reducing trade barriers
ExplanationFTAs aim to integrate economies by minimizing trade barriers.
#14
Which trade theory suggests that countries should specialize in producing goods for which they have a comparative advantage and then trade with other countries?
Comparative advantage theory
ExplanationComparative advantage theory advocates for specialization based on relative efficiencies.
#15
What is the primary goal of export subsidies?
To promote domestic production for export
ExplanationExport subsidies aim to boost domestic exports.