International Trade

Which of the following are results of tariffs and quotas?

• reducing trade surpluses.

• protecting foreign industry.

• smothering third-world development.

• increasing prices consumers pay for goods.

Revenue tariffs are levied to do which of the following?

• lower exports

• protect domestic producers

• raise money

• increase imports

The North American Free Trade Agreement proposed free trade between the United States and which of the following countries?

• Brazil and Mexico

• the European Union

• Canada and Mexico

• Central American countries

The United States trade deficit, along with declining value of the dollar, causes which of the following?

• the value of the dollar to fall in foreign exchange markets.

• increased employment opportunities for Americans in import industries.

• worldwide recessions.

• the value of the dollar to strengthen in foreign exchange markets.

A protective tariff is used to do which of the following?

• expand trade.

• increase revenue.

• gain a comparative advantage.

• give inefficient domestic industries an advantage.

The EU and ASEAN have a trade agreement in effect since 1980. However the EU has an embargo to trade with Burma/Myanmar as long as human rights are an issue in that country. This is an example of which of the following?

• subsidies

• most favored nation

• trade barriers

• tariffs

The purpose of the founding of the European Union (E.U.) in 1993 was to do which of the following?

• fight the growing global network of terrorism.

• guarantee the freedom of movement of people, goods, services and capital.

• become an economic power to compete with the Unites States.

• prevent the poor from causing a revolution.

Because Columbia specializes in the production of coffee and the United State specializes in the production of airplanes, the two countries could engage in trade that benefits both parties. This law of economics is known as which of the following?

• parallel consumption.

• relative distribution.

• comparative advantage.

• supply and demand.

The value of the Dollar appreciates versus the Euro. Who will benefit?

• an American exporter

• a French traveler to the United States

• an American traveling to Europe

• no one benefits

Travis takes two trips to Ecuador. On his first trip, he finds that one US dollar is worth 25000 Ecuadorian Sucre. On his return trip, he finds that the dollar is now worth 26000 Ecuadorian Sucre. What is a LIKELY result of this change in exchange rates?

• American Imports from Ecuador increase

• Ecuadorians invest more in infrastructure

• There is not enough information to answer

• American Exports to Ecuador Increase