Question 1

The TRIPS regulations oblige WTO members to grant and enforce patents lasting at least 20 years and copyrights lasting 50 years.

Accepted Answer

A) True 
 B)False

Question 2

The ________ raised tariff barriers in the hope of protecting jobs and diverting consumer demand away from foreign products.

Accepted Answer

A)  Smoot-Hawley Act 
B)  Helms-Burton Act 
C)  General Agreement on Tariffs and Trade 
D)  Buy America Act 
A)  Smoot-Hawley Act 
B)  Helms-Burton Act 
C)  General Agreement on Tariffs and Trade 
D)  Buy America Act

Question 3

Which of the following observations about tariffs is true?

Accepted Answer

A)  Tariffs are generally anti-producer and pro-consumer. 
B)  Export tariffs are used to raise revenue for the government. 
C)  Export tariffs are far more common than import tariffs. 
D)  Import tariffs increase the overall efficiency of the world economy. 
A)  Tariffs are generally anti-producer and pro-consumer. 
B)  Export tariffs are used to raise revenue for the government. 
C)  Export tariffs are far more common than import tariffs. 
D)  Import tariffs increase the overall efficiency of the world economy.

Question 4

The infant industry argument is the latest argument for government intervention in trade.

Accepted Answer

A) True 
 B)False

Question 5

According to the strategic trade policy argument,

Accepted Answer

A)  government intervention is not required because firms can borrow money from the capital markets to finance the required investments. 
B)  selling goods in a foreign market at below their "fair" market value is legally and ethically justified. 
C)  government support can help domestic firms overcome the first-mover advantages enjoyed by foreign competitors. 
D)  a government should use subsidies to support promising firms that are active in old, established industries. 
A)  government intervention is not required because firms can borrow money from the capital markets to finance the required investments. 
B)  selling goods in a foreign market at below their "fair" market value is legally and ethically justified. 
C)  government support can help domestic firms overcome the first-mover advantages enjoyed by foreign competitors. 
D)  a government should use subsidies to support promising firms that are active in old, established industries.

Question 6

According to the infant industry argument, many developing countries have a potential ________ in manufacturing, but new manufacturing industries cannot initially compete with established industries in developed countries.

Accepted Answer

A)  absolute advantage 
B)  comparative advantage 
C)  opportunity cost 
D)  competitive advantage 
A)  absolute advantage 
B)  comparative advantage 
C)  opportunity cost 
D)  competitive advantage

Question 7

Local content regulations

Accepted Answer

A)  protect domestic producers by limiting foreign competition. 
B)  lower the prices of imported components. 
C)  tend to benefit consumers and not producers. 
D)  encourage outsourcing of production units. 
A)  protect domestic producers by limiting foreign competition. 
B)  lower the prices of imported components. 
C)  tend to benefit consumers and not producers. 
D)  encourage outsourcing of production units.

Question 8

Free trade as a government policy was first officially embraced by Great Britain in 1846, when the British Parliament repealed a law that placed a high tariff on

Accepted Answer

A)  all agricultural products. 
B)  wheat. 
C)  textiles. 
D)  corn. 
A)  all agricultural products. 
B)  wheat. 
C)  textiles. 
D)  corn.

Question 9

According to the 1986 Uruguay Round, the ________ was to be created to implement the GATT agreement.

Accepted Answer

A)  World Trade Organization 
B)  International Monetary Fund 
C)  United Nations 
D)  World Bank 
A)  World Trade Organization 
B)  International Monetary Fund 
C)  United Nations 
D)  World Bank

Question 10

Tariffs are generally pro-consumer and anti-producer.

Accepted Answer

A) True 
 B)False

Question 11

What are the central issues facing the WTO at the present time?

Accepted Answer

Four issues at the top of the agenda for

Question 12

By lowering production costs, ________ help domestic producers compete against foreign imports.

Accepted Answer

A)  subsidies 
B)  duties 
C)  quotas 
D)  tariffs 
A)  subsidies 
B)  duties 
C)  quotas 
D)  tariffs

Question 13

Business firms that lobby their governments to engage in protectionism may miss the opportunity to build ________ by constructing a globally dispersed production system.

Accepted Answer

A)  an absolute advantage 
B)  a competitive advantage 
C)  a strategic trade advantage 
D)  a comparative advantage 
A)  an absolute advantage 
B)  a competitive advantage 
C)  a strategic trade advantage 
D)  a comparative advantage

Question 14

The Smoot-Hawley Act was aimed at

Accepted Answer

A)  diverting consumer demand toward foreign products. 
B)  promoting unrestricted free trade. 
C)  limiting global warming. 
D)  avoiding rising unemployment. 
A)  diverting consumer demand toward foreign products. 
B)  promoting unrestricted free trade. 
C)  limiting global warming. 
D)  avoiding rising unemployment.

Question 15

What happened to GATT during the 1980s and early 1990s?

Accepted Answer

During the 1980s and early 1990s, the wo

Question 16

Which of the following is one of the main instruments of trade policy?

Accepted Answer

A)  tariffs 
B)  credit portfolios 
C)  opportunity costs 
D)  countervailing duties 
A)  tariffs 
B)  credit portfolios 
C)  opportunity costs 
D)  countervailing duties

Question 17

Foreign producers typically agree to voluntary export restrictions because

Accepted Answer

A)  their manufacturing capacity is limited. 
B)  they can divert their exports to other countries and charge more for their products. 
C)  they fear far more damaging punitive tariffs or import quotas might follow if they do not. 
D)  they are required to by the World Trade Organization. 
A)  their manufacturing capacity is limited. 
B)  they can divert their exports to other countries and charge more for their products. 
C)  they fear far more damaging punitive tariffs or import quotas might follow if they do not. 
D)  they are required to by the World Trade Organization.

Question 18

WTO rules allow countries to ________ foreign goods that are being sold cheaper than at home, or below their cost of production, when domestic producers can show that they are being harmed.

Accepted Answer

A)  impose antidumping duties on 
B)  subsidize 
C)  lower the import quota on 
D)  place countervailing duties on 
A)  impose antidumping duties on 
B)  subsidize 
C)  lower the import quota on 
D)  place countervailing duties on

Question 19

The WTO does not have the power to impose trade sanctions.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following is a drawback of government intervention?

Accepted Answer

A)  It may invite retaliation and trigger a trade war. 
B)  The policies may be captured by foreign investors and turned to their advantage. 
C)  Despite being well executed, the intervention is unlikely to work. 
D)  They usually establish new tariff levels on technology-to the detriment of all in the industry. 
A)  It may invite retaliation and trigger a trade war. 
B)  The policies may be captured by foreign investors and turned to their advantage. 
C)  Despite being well executed, the intervention is unlikely to work. 
D)  They usually establish new tariff levels on technology-to the detriment of all in the industry.

The TRIPS regulations oblige WTO members to grant and enforce patents lasting at least 20 years and copyrights lasting 50 years.

The ________ raised tariff barriers in the hope of protecting jobs and diverting consumer demand away from foreign products.

Which of the following observations about tariffs is true?

The infant industry argument is the latest argument for government intervention in trade.

According to the strategic trade policy argument,

According to the infant industry argument, many developing countries have a potential ________ in manufacturing, but new manufacturing industries cannot initially compete with established industries in developed countries.

Local content regulations

Free trade as a government policy was first officially embraced by Great Britain in 1846, when the British Parliament repealed a law that placed a high tariff on

According to the 1986 Uruguay Round, the ________ was to be created to implement the GATT agreement.

Tariffs are generally pro-consumer and anti-producer.

What are the central issues facing the WTO at the present time?

By lowering production costs, ________ help domestic producers compete against foreign imports.

Business firms that lobby their governments to engage in protectionism may miss the opportunity to build ________ by constructing a globally dispersed production system.

The Smoot-Hawley Act was aimed at

What happened to GATT during the 1980s and early 1990s?

Which of the following is one of the main instruments of trade policy?

Foreign producers typically agree to voluntary export restrictions because

WTO rules allow countries to ________ foreign goods that are being sold cheaper than at home, or below their cost of production, when domestic producers can show that they are being harmed.

The WTO does not have the power to impose trade sanctions.

Which of the following is a drawback of government intervention?

Globalization

National Differences in Political, Economic, and Legal Systems

National Differences in Economic Development

Differences in Culture

Ethics, Corporate Social Responsibility, and Sustainability

International Trade Theory

Foreign Direct Investment

Regional Economic Integration

The Foreign Exchange Market

The International Monetary System

The Global Capital Market

The Strategy of International Business

The Organization of International Business

Entry Strategy and Strategic Alliances

Exporting, Importing, and Countertrade

Global Production and Supply Chain Management

Global Marketing and R&D

Global Human Resource Management

Accounting and Finance in the International Business

Filters

Exam 7: Government Policy and International Trade

The TRIPS regulations oblige WTO members to grant and enforce patents lasting at least 20 years and copyrights lasting 50 years.

The ________ raised tariff barriers in the hope of protecting jobs and diverting consumer demand away from foreign products.

Which of the following observations about tariffs is true?

The infant industry argument is the latest argument for government intervention in trade.

According to the strategic trade policy argument,

According to the infant industry argument, many developing countries have a potential ________ in manufacturing, but new manufacturing industries cannot initially compete with established industries in developed countries.

Local content regulations

Free trade as a government policy was first officially embraced by Great Britain in 1846, when the British Parliament repealed a law that placed a high tariff on

According to the 1986 Uruguay Round, the ________ was to be created to implement the GATT agreement.

Tariffs are generally pro-consumer and anti-producer.

What are the central issues facing the WTO at the present time?

By lowering production costs, ________ help domestic producers compete against foreign imports.

Business firms that lobby their governments to engage in protectionism may miss the opportunity to build ________ by constructing a globally dispersed production system.

The Smoot-Hawley Act was aimed at

What happened to GATT during the 1980s and early 1990s?

Which of the following is one of the main instruments of trade policy?

Foreign producers typically agree to voluntary export restrictions because

WTO rules allow countries to ________ foreign goods that are being sold cheaper than at home, or below their cost of production, when domestic producers can show that they are being harmed.

The WTO does not have the power to impose trade sanctions.

Which of the following is a drawback of government intervention?

Globalization

National Differences in Political, Economic, and Legal Systems

National Differences in Economic Development

Differences in Culture

Ethics, Corporate Social Responsibility, and Sustainability

International Trade Theory

Foreign Direct Investment

Regional Economic Integration

The Foreign Exchange Market

The International Monetary System

The Global Capital Market

The Strategy of International Business

The Organization of International Business

Entry Strategy and Strategic Alliances

Exporting, Importing, and Countertrade

Global Production and Supply Chain Management

Global Marketing and R&D

Global Human Resource Management

Accounting and Finance in the International Business

Filters