What do you know about Economics?

Front

Which condition is most likely to cause an increase in the international value of a nation’s currency? Options: Reduced inflation in other nations, Higher real interest rates in that nation, Lower government expenditures in that nation, An expansionary monetary policy in that nation

Back

Higher real interest rates in that nation

Front

Which government action would most likely have a NEGATIVE long-term impact on United States trade levels? Options: Financing improvements to foreign countries’ ports, Lobbying foreign governments to purchase U.S. goods, Negotiating export quotas for U.S. goods with a trading bloc, Eliminating international and domestic product quality regulations

Back

Negotiating export quotas for U.S. goods with a trading bloc

Front

Assume that Mexican consumers increase their demand for Nicaraguan financial assets. How would the international supply of Mexican pesos and the value of the Nicaraguan Cordoba most likely change?

Back

The supply of pesos would increase, and the value of the Cordoba would decrease.

Front

Why might international trade lower the wage rate of unskilled workers in the United States while skilled workers remain well paid?

Back

Some U.S. workers’ human capital surpasses that of workers in other countries.

Front

Countries that implement import quotas and tariffs are most likely to experience which effect? Options: Increased demand for durable goods., Increased specialization in production., Increased employment in protected industries., Increased international competition in affected markets.

Back

Increased employment in protected industries.

Front

How would a regional free trade agreement most likely impact a member nation’s control over its economy?

Back

An international body would mediate trade disputes.

Front

What is the effect of a country restricting the ability of international businesses to sell goods in its domestic markets?

Back

It reduces the total production that is possible from the world’s resources.

Front

What is an incentive for the United States to join an international economic organization, such as the World Trade Organization?

Back

The organization supports free trade and productive handling of trade disputes.

Front

How does the image above best explain the economic health of a country?

Back

The image above, also known as the Circular Flow of Money, Goods, and Resources, demonstrates that if economic activity is occurring, the flow of goods and services is moving at a rapid pace. This pace speeds up as economic health improves and slows down as the economy begins to slow. This demonstrates the health of a country’s economy.

Front

How would your interpretation of the data change if Columns X and Y were added to the chart?

Back

According to the new economic data that was added, Country Z has a stronger economy. Through 2010-2012, it had weaker unemployment, rising inflationary pressure, and weak Real GDP growth. However, by adding the new columns, Country Z demonstrates a shrinking total unemployment, decreasing inflationary pressure, and consistent Real GDP growth. This proves that its economy is now stronger than Country Y.