AnswersOC27 Economics-2102310-Sem-MeadowsEconomic Development

Economic Development — Unit test Answers

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1
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Gross domestic product tracks economic growth by measuring all goods and services

A
exported by an economy.
B
produced by an economy.
C
imported by an economy.
D
purchased by an economy.
2
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Global trade provides consumers with

A
more options and lower prices.
B
fewer options and lower prices.
C
more options and higher prices.
D
fewer options and higher prices.
3

Which region is most likely to export bananas to the United States?

A
Europe
B
Central America
C
Middle East
D
Asia
4

Read this news report about a planned devaluation of the bolivar, the currency of Venezuela.The president of Venezuela announced that the country would be devaluating the bolivar for the fifth time in nine years. The official rate is falling from 4.3 bolivars to the dollar, to 6.3, a 32% devaluation. By increasing the bolivar value of exports of oil to the US and other nations, the government hopes to alleviate a budget crisis caused by its increasing reliance on borrowing to meet spending obligations.In response to the announcement, the people of Venezuela lined up today to buy televisions, electronics, and airline tickets in order to protect themselves from projected price increases.

A
rising inflation.
B
price deflation.
C
declining inflation.
D
increased imports.
5

Which statement best describes how globalization is affecting the world?

A
Globalization is growing less important as time passes.
B
The world is becoming more globalized and connected.
C
Globalization has resulted in fewer connections among countries.
D
Countries are growing less likely to trade with one another.
6

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
7

What role does competition play in international trade?

A
It results in higher prices.
B
It discourages imports.
C
It drives down prices for consumers.
D
It does away with the need for investment.
8

The chart shows a circular flow model describing the movement of goods and services.

Question illustration
A
The foreign sector influences how services move between firms and households.
B
The foreign sector influences how imports and exports move between firms and households.
C
The foreign sector influences how factors of production move between firms and households.
D
The foreign sector influences how goods move between firms and households.
9

is the process of an economy’s increasing industrialization, standard of living, and economic wealth.

Answer not available
10

A country that has multinational corporations is most likely to be

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

How are subsidies similar to tariffs?

A
Both are types of taxes.
B
Both aim to lower the price of domestic goods.
C
Both are types of tax breaks and financial assistance.
D
Both allow domestic goods to compete against foreign goods.
12

What term describes a ban or restriction on trade with another country?

Answer not available
13

Which of these statements most accurately describes currencies in North America?

A
All countries in North America use the US dollar.
B
All countries in North America use the euro.
C
North American countries have done away with separate currencies.
D
Each country in North America uses its own currency.
14

The graph shows gross domestic product in the US private sector from 2009 to 2017.

Question illustration
A
The economy suffered a setback in 2009 before rebounding in 2011.
B
The economy suffered a setback in 2009 before rebounding in 2010.
C
The economy suffered a setback in 2009 and had not recovered by 2011.
D
The economy suffered setbacks in the years 2009, 2010, and 2011.
15

The chart below shows an exchange rate table.

Question illustration
A
US dollar.
B
Swiss franc.
C
Japanese yen.
D
euro.
16

What are the most likely reasons a US corporation would open a factory in China? Choose four answers.

A
to take advantage of affordable land prices
B
to take advantage of abundant resources
C
to take advantage of lower labor costs
D
to take advantage of favorable tax laws
E
to take advantage of US employment opportunities
17

What is the purpose of quotas?

A
to ban all imports from a country
B
to ensure specific goods are not available to consumers
C
to limit how much of a good can be imported
D
to keep prices on domestic goods low
18

The graph below shows the value of the US dollar versus the Canadian dollar.

Question illustration
A
rising against the Canadian dollar.
B
falling against the Canadian dollar.
C
more than twice that of the Canadian dollar.
D
about half that of the Canadian dollar.
19

Which best describes how standards help domestic producers?

A
Standards require goods to meet basic requirements.
B
Standards provide financial support for producers.
C
Standards restrict the import of cheap goods.
D
Standards offer incentives to ensure high quality.
20

What is the government’s aim in setting quotas?

A
to create more competition in the market
B
to increase sales of domestic goods
C
to keep tariffs high
D
to limit export of domestic goods

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