INTERNATIONAL TRADE & TRADE THEORIES

National Security and Domestic Product are two reasons for Trade Barriers.

• TRUE

• FALSE

Quota is a legal limit imposed on the amount of a good that may be imported.

• TRUE

• FALSE

Sale of goods abroad at a price below their cost and below the price charged in the domestic market is a dumping.

• TRUE

• FALSE

Having a trade surplus means the country exports more than it imports, while having a trade deficit means the country exports less than it imports.

• TRUE

• FALSE

A government restriction on the number of cameras that can be imported from China each year is an example of an import quota.

• TRUE

• FALSE

Countries have different rates of productivity due to their natural resources, climate, technology, labor costs, and other factors. This represents the country's comparative advantage.

• TRUE

• FALSE

A company may prolong a product's life cycle through international marketing by exporting a product that is in the standardize stage in its home market to a foreign market with high growth prospects..

• TRUE

• FALSE

Absolute advantage occurs when states specialize in producing the goods that they produce best and trade for goods that other states are better at producing.

• TRUE

• FALSE

HO (factor-proportions) stated that countries traded completely specialize in the good in which they have a comparative advantage.

• TRUE

• FALSE

Porter’s theory stated that a nation’s competitiveness in an industry depends on the capacity of the industry to innovate and upgrade.

• TRUE

• FALSE