Question 1

Which of the following must NAC ensure in order to reduce exposure to trade barriers?

Accepted Answer

A) reduced production 
B) strong emphasis on quality 
C) accurate product classification 
D) obtaining patents for inventions

Question 2

Governments impose defensive barriers to pursue strategic or public policy objectives, such as increasing employment or generating tax revenues.

Accepted Answer

A) True 
 B)False

Question 3

________ are transfer payments or tax concessions made directly to foreign firms to entice them to invest in the country.

Accepted Answer

A) Investment incentives 
B) Antidumping duties 
C) Countervailing duties 
D) Quotas

Question 4

The WTO was created in order to reduce tariffs through continuous negotiations among member nations.

Accepted Answer

A) True 
 B)False

Question 5

Nontariff trade barriers have increased in popularity partly because they ________.

Accepted Answer

A) generate profits for foreign firms 
B) are easier to conceal from the WTO 
C) restrict trade by imposing direct tax 
D) have been fairly successful in eliminating smuggling along international borders

Question 6

The ________ is the level of regional integration that remains an ideal and is yet to be achieved.

Accepted Answer

A) free trade area 
B) common market 
C) political union 
D) customs union

Question 7

What is the primary ethical concern regarding the import of products from poor countries?

Accepted Answer

A) Higher tariffs hurt poor nations more than developed nations. 
B) Nations lacking economic freedom cannot afford to export. 
C) Emerging nations use government intervention to protect domestic industries. 
D) Lack of subsidies adversely affect poor countries.

Question 8

Which of the following has occurred as a result of NAFTA?

Accepted Answer

A) workers at maquiladoras have instigated union strikes 
B) Mexico's per-capita income has risen substantially 
C) Canadian exports to Europe and Asia have doubled 
D) foreign investors have been replaced by U.S. firms

Question 9

An import license refers to a(n)________.

Accepted Answer

A) tax charged on an imported product whose price is below usual prices in the local market 
B) list of complex procedures imposed on importers that hinder trade and investment 
C) complicated system of establishing quotas 
D) government authorization granted to a firm for importing a product

Question 10

Which of the following terms refers to two or more geographically connected nations in pursuit of free trade relations?

Accepted Answer

A) grey market 
B) trading diaspora 
C) economic bloc 
D) business strategic unit

Question 11

________ refer to rules that limit the ability of foreign firms to invest in certain industries or acquire local firms.

Accepted Answer

A) Quotas 
B) Regulations and technical standards 
C) FDI and ownership restrictions 
D) Administrative and bureaucratic procedures

Question 12

Governments intervene in international trade and investments in order to protect the interests of foreign investment firms.

Accepted Answer

A) True 
 B)False

Question 13

Governments sometimes retaliate against subsidies by imposing ________, tariffs on products imported into a country to offset subsidies given to producers or exporters in the exporting country.

Accepted Answer

A) local content requirements 
B) investment incentives 
C) countervailing duties 
D) antidumping duties

Question 14

A formal arrangement between two or more countries to reduce or eliminate tariffs is known as a(n)________.

Accepted Answer

A) quota arrangement 
B) free trade agreement 
C) memorandum of association 
D) memorandum of understanding

Question 15

Restrictions on the outflow of hard currency from a country or on the inflow of foreign currencies is called ________.

Accepted Answer

A) antidumping duty 
B) currency appreciation 
C) currency control 
D) currency depreciation

Question 16

Maquiladoras refer to export-assembly plants in northern Mexico along the U.S. border that produce components and typically finished products destined for the United States on a tariff-free basis.

Accepted Answer

A) True 
 B)False

Question 17

Which of the following best supports maintaining the existing cotton quota?

Accepted Answer

A) Zanzi cotton growers are protected from cheaper cotton imports. 
B) Zanzi cotton growers have an advantage when they export cotton fabric to other countries. 
C) The local fabric manufacturer pays high prices for cotton. 
D) The local fabric manufacturer uses mostly Zanzi-grown cotton.

Question 18

Which of the following is responsible for determining the admission of new member countries to the EU?

Accepted Answer

A) the Council of the European Union 
B) the European Parliament 
C) the European Court of Justice 
D) the European Commission

Question 19

In a short essay, explain how the GATT changed international trade.

Accepted Answer

The answer of In a short essay, explain how the...

Question 20

The Chinese government's policy of requiring foreign firms to enter the Chinese market via joint ventures is intended to ________.

Accepted Answer

A) limit the amount of FDI 
B) create jobs for Chinese workers 
C) protect China's national security 
D) stimulate foreign investment

Exam 7: Government Intervention and Regional Economic Integration

Which of the following must NAC ensure in order to reduce exposure to trade barriers?

Governments impose defensive barriers to pursue strategic or public policy objectives, such as increasing employment or generating tax revenues.

________ are transfer payments or tax concessions made directly to foreign firms to entice them to invest in the country.

The WTO was created in order to reduce tariffs through continuous negotiations among member nations.

Nontariff trade barriers have increased in popularity partly because they ________.

The ________ is the level of regional integration that remains an ideal and is yet to be achieved.

What is the primary ethical concern regarding the import of products from poor countries?

Which of the following has occurred as a result of NAFTA?

An import license refers to a(n) ________.

Which of the following terms refers to two or more geographically connected nations in pursuit of free trade relations?

________ refer to rules that limit the ability of foreign firms to invest in certain industries or acquire local firms.

Governments intervene in international trade and investments in order to protect the interests of foreign investment firms.

Governments sometimes retaliate against subsidies by imposing ________, tariffs on products imported into a country to offset subsidies given to producers or exporters in the exporting country.

A formal arrangement between two or more countries to reduce or eliminate tariffs is known as a(n) ________.

Restrictions on the outflow of hard currency from a country or on the inflow of foreign currencies is called ________.

Maquiladoras refer to export-assembly plants in northern Mexico along the U.S. border that produce components and typically finished products destined for the United States on a tariff-free basis.

Which of the following best supports maintaining the existing cotton quota?

Which of the following is responsible for determining the admission of new member countries to the EU?

In a short essay, explain how the GATT changed international trade.

The Chinese government's policy of requiring foreign firms to enter the Chinese market via joint ventures is intended to ________.