Question 1

Customs duties decrease the total amount of a good's production cost.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following industries is typically protected for national security reasons?

Accepted Answer

A) agriculture 
B) textile 
C) automobile 
D) housing 
A) agriculture 
B) textile 
C) automobile 
D) housing

Question 3

Tariffs are a source of government revenue mostly among developing nations.

Accepted Answer

A) True 
 B)False

Question 4

A compound tariff on an imported product is calculated partly as a percentage of its stated price and partly as a specific fee for each unit.

Accepted Answer

A) True 
 B)False

Question 5

The protection of infant industries by a nation's government can cause domestic companies to become complacent toward innovation.

Accepted Answer

A) True 
 B)False

Question 6

Konesia Joins the World
Konesia,a former totalitarian economy and pariah state,is taking steps toward a free market economy.The government wants to encourage trade but also wants to find a balance so that local businesses and industries are not harmed.
-If Konesia chooses to levy tariffs as a percentage of the stated price of an imported product,this would be an example of a(n)________.

Accepted Answer

A) compound tariff 
B) specific tariff 
C) ad valorem tariff 
D) tariff-quota 
A) compound tariff 
B) specific tariff 
C) ad valorem tariff 
D) tariff-quota

Question 7

The protection of infant industries by a nation's government can cause more economic harm than good.

Accepted Answer

A) True 
 B)False

Question 8

The purpose of ________ is to force companies from other nations to use local resources in their production processes,particularly labor.

Accepted Answer

A) administrative delays 
B) currency controls 
C) local content requirements 
D) voluntary export restraints 
A) administrative delays 
B) currency controls 
C) local content requirements 
D) voluntary export restraints

Question 9

A(n)________ tariff is levied on an imported product and calculated partly as a percentage of its stated price and partly as a specific fee for each unit.

Accepted Answer

A) specific 
B) compound 
C) ad valorem 
D) transit 
A) specific 
B) compound 
C) ad valorem 
D) transit

Question 10

Which of the following statements is true of embargoes?

Accepted Answer

A) An embargo may be placed on one or a few goods or may completely ban trade in all goods. 
B) An embargo is the least restrictive nontariff barrier available. 
C) An embargo is usually employed for economic reasons. 
D) Embargoes are used frequently today because they are easy to implement. 
A) An embargo may be placed on one or a few goods or may completely ban trade in all goods. 
B) An embargo is the least restrictive nontariff barrier available. 
C) An embargo is usually employed for economic reasons. 
D) Embargoes are used frequently today because they are easy to implement.

Question 11

Describe the main political motives behind government intervention in trade.

Accepted Answer

Government officials often make trade-re

Question 12

A country that believes an imported product is being sold in its market for a price lower than the cost of production for the product may impose a(n)________ in retaliation.

Accepted Answer

A) countervailing duty 
B) ad valorem tariff 
C) antidumping duty 
D) compound tariff 
A) countervailing duty 
B) ad valorem tariff 
C) antidumping duty 
D) compound tariff

Question 13

Which of the following is a political motive behind a government's intervention in trade?

Accepted Answer

A) promoting a strategic trade policy 
B) gaining influence over other nations 
C) protecting a country from unwanted cultural influence 
D) protecting young industries from competition 
A) promoting a strategic trade policy 
B) gaining influence over other nations 
C) protecting a country from unwanted cultural influence 
D) protecting young industries from competition

Question 14

Using tariffs to generate government revenue is most common among ________.

Accepted Answer

A) developed countries 
B) developing countries 
C) western nations 
D) First World nations 
A) developed countries 
B) developing countries 
C) western nations 
D) First World nations

Question 15

Not-So-Free Freeland
Freeland is a semi-closed economy whose government believes in protecting national identity and building a self-sustained economy.The government's priority is to protect local jobs and provide opportunities to Freeland's emerging industries to flourish without the threat of external competition.
-Freeland's protection of its national identity is an example of a(n)________.

Accepted Answer

A) political motive 
B) economic motive 
C) cultural motive 
D) social motive 
A) political motive 
B) economic motive 
C) cultural motive 
D) social motive

Question 16

Excelsior's Limited
Excelsior's Limited,a manufacturer of health and beauty aids,is expanding its presence in several countries around the world.Excelsior's president is surprised at some of the responses the company is receiving from other countries.
-France gave Excelsior's Limited permission to export its product as long as the company obtained a special license first.Excelsior has been waiting six months for the license and is wondering if it will ever arrive.Excelsior's Limited is experiencing a(n)________.

Accepted Answer

A) administrative delay 
B) local content requirement 
C) embargo 
D) currency control 
A) administrative delay 
B) local content requirement 
C) embargo 
D) currency control

Question 17

Excelsior's Limited
Excelsior's Limited,a manufacturer of health and beauty aids,is expanding its presence in several countries around the world.Excelsior's president is surprised at some of the responses the company is receiving from other countries.
-When Excelsior's Limited tried to convert its earnings from one country,the government stipulated that the company had to exchange its currency at a very unfavorable rate.This is an example of a(n)________.

Accepted Answer

A) administrative delay 
B) currency control 
C) subsidy 
D) tariff 
A) administrative delay 
B) currency control 
C) subsidy 
D) tariff

Question 18

Which of the following is a result of the protection of domestic companies from international competition?

Accepted Answer

A) Consumers need to pay lesser for products. 
B) There are increased incentives to cut production costs and improve quality. 
C) Companies become more reliant on protection. 
D) Protection increases a company's incentives to obtain the knowledge it needs to become more competitive. 
A) Consumers need to pay lesser for products. 
B) There are increased incentives to cut production costs and improve quality. 
C) Companies become more reliant on protection. 
D) Protection increases a company's incentives to obtain the knowledge it needs to become more competitive.

Question 19

A requirement that all WTO members extend the same favorable terms of trade to all members that they extend to any single member is called ________.

Accepted Answer

A) normal trade relations 
B) antidumping duties 
C) local content requirements 
D) countervailing duties 
A) normal trade relations 
B) antidumping duties 
C) local content requirements 
D) countervailing duties

Question 20

Explain why job protection is a political motive for governments to restrict free trade.Why might a government interested in job protection insist on local content requirements for international firms doing business in that country?

Accepted Answer

Government officials often make trade-re

Customs duties decrease the total amount of a good's production cost.

Which of the following industries is typically protected for national security reasons?

Tariffs are a source of government revenue mostly among developing nations.

A compound tariff on an imported product is calculated partly as a percentage of its stated price and partly as a specific fee for each unit.

The protection of infant industries by a nation's government can cause domestic companies to become complacent toward innovation.

The protection of infant industries by a nation's government can cause more economic harm than good.

The purpose of ________ is to force companies from other nations to use local resources in their production processes,particularly labor.

A(n)________ tariff is levied on an imported product and calculated partly as a percentage of its stated price and partly as a specific fee for each unit.

Which of the following statements is true of embargoes?

Describe the main political motives behind government intervention in trade.

A country that believes an imported product is being sold in its market for a price lower than the cost of production for the product may impose a(n)________ in retaliation.

Which of the following is a political motive behind a government's intervention in trade?

Using tariffs to generate government revenue is most common among ________.

Which of the following is a result of the protection of domestic companies from international competition?

A requirement that all WTO members extend the same favorable terms of trade to all members that they extend to any single member is called ________.

Explain why job protection is a political motive for governments to restrict free trade.Why might a government interested in job protection insist on local content requirements for international firms doing business in that country?

Globalization

Cross-Cultural Business

Political Economy and Ethics

Economic Development of Nations

International Trade Theory

Foreign Direct Investment

Regional Economic Integration

International Financial Markets

International Monetary System

International Strategy and Organization

Analyzing International Opportunities

Selecting and Managing Entry Modes

Developing and Marketing Products

Managing International Operations

Hiring and Managing Employees

Filters

Exam 6: Political Economy of Trade

Customs duties decrease the total amount of a good's production cost.

Which of the following industries is typically protected for national security reasons?

Tariffs are a source of government revenue mostly among developing nations.

A compound tariff on an imported product is calculated partly as a percentage of its stated price and partly as a specific fee for each unit.

The protection of infant industries by a nation's government can cause domestic companies to become complacent toward innovation.

The protection of infant industries by a nation's government can cause more economic harm than good.

The purpose of ________ is to force companies from other nations to use local resources in their production processes,particularly labor.

A(n)________ tariff is levied on an imported product and calculated partly as a percentage of its stated price and partly as a specific fee for each unit.

Which of the following statements is true of embargoes?

Describe the main political motives behind government intervention in trade.

A country that believes an imported product is being sold in its market for a price lower than the cost of production for the product may impose a(n)________ in retaliation.

Which of the following is a political motive behind a government's intervention in trade?

Using tariffs to generate government revenue is most common among ________.

Which of the following is a result of the protection of domestic companies from international competition?

A requirement that all WTO members extend the same favorable terms of trade to all members that they extend to any single member is called ________.

Explain why job protection is a political motive for governments to restrict free trade.Why might a government interested in job protection insist on local content requirements for international firms doing business in that country?

Globalization

Cross-Cultural Business

Political Economy and Ethics

Economic Development of Nations

International Trade Theory

Foreign Direct Investment

Regional Economic Integration

International Financial Markets

International Monetary System

International Strategy and Organization

Analyzing International Opportunities

Selecting and Managing Entry Modes

Developing and Marketing Products

Managing International Operations

Hiring and Managing Employees

Filters