Trade and Development — Test Answers

25 verified answers3 views
1
Free Preview

According to this excerpt, what is one major way in which the World Bank differs from a regular bank?

A
The World Bank serves people of different income levels.
B
The World Bank provides low-interest loans and credit.
C
The World Bank aims to improve living standards.
D
The World Bank is a source of financial assistance.
2
Free Preview

Which of these is a positive incentive for domestic producers?

A
a tariff on clothes
B
a subsidy on imported cars
C
a subsidy on domestic oranges
D
a tariff on cars
3

What is the most common reason why countries create trade agreements?

A
to decrease trade
B
to establish quotas
C
to create free trade
D
to limit imports
4

What are standards designed to do? Choose three correct answers.

A
support domestic industries
B
limit imports
C
ensure safety
D
offer domestic industries an advantage
E
protect consumers
5

What do quotas and embargoes have in common?

A
They both frequently result in domestic shortages.
B
They both tend to raise prices.
C
They both affect imports from certain countries.
D
They both set limits on imported goods.
6

Which best describes why countries establish limits on international trade? Choose three correct answers.

A
to restrict importation of a foreign good
B
to force domestic industries to sell higher quality goods
C
to restrict foreign influence in a sector
D
to punish other countries
E
to lower the price of foreign goods
7

According to this quotation, what did President Ronald Reagan believe about economic growth? "We should be trying to foster the growth of two-way trade, not trying to put up roadblocks, to open foreign markets, not close our own.”

A
Free trade associations would limit competition.
B
Trade barriers would help make trade more fair.
C
Increased fair trade would help the economy.
D
Increased trade barriers would help the economy.
8

Which statement accurately describes a developing country?

A
The country has a high standard of living.
B
The country has a high GDP per capita.
C
The country's population has a high life expectancy.
D
The country's population has a high growth rate.
10

A country that has multinational corporations is most likely to be

A
a developing economy.
B
a developed economy.
C
a control economy.
D
a transitioning economy.
11

What steps must countries take to transition to a mixed-market economy? Choose two correct answers.

A
They must decrease private ownership.
B
They must open up trade to other countries.
C
They must discourage foreign investment.
D
They must establish state-owned businesses.
E
They must establish a fair labor market.
12

What is one reason two countries may sign a treaty to create a direct agreement with one another?

A
to establish barriers to trade
B
to cut taxes
C
to collect more taxes
D
to limit trade opportunities for competing companies
13

Tariffs and subsidies are both types of

A
economic benefits for the consumer.
B
economic benefits for the international producer.
C
positive and negative incentives.
D
monetary restrictions for the domestic producer.
16

The primary benefit of a Free Trade Agreement is that they

A
allow countries to more easily buy what they do not produce.
B
can fund international finance projects.
C
have fewer economic restrictions than trade organizations.
D
allow countries to charge high tariffs on imports and exports.
17

Which best describes the standards required of foreign producers?

A
Foreign producers have more stringent standards than domestic producers.
B
Foreign producers must meet specific standards based on their origin.
C
Foreign producers do not use standards that harm consumers.
D
Foreign producers must meet the same standards as domestic producers.
18

International trade organizations promote free trade by encouraging countries to

A
limit their protectionism policies.
B
maintain their tariffs.
C
establish their trade quotas.
D
develop their products.
19

Why do countries provide financial incentives?

A
Financial incentives restrict all trade.
B
Financial incentives set standards.
C
Financial incentives act as trade barriers.
D
Financial incentives limit imports.
20

Trade agreements are helpful because they allow countries to

A
influence foreign trade.
B
trade for necessary goods.
C
help create new trade barriers.
D
increase trade tax revenue.

Did you find these answers helpful?