International Test Prep

What is the MOST restrictive trade barrier between countries?

• Embargo

• Quota

• Standards

• Tariff

What term represents why the USA imports shirts and exports airplanes?

• Balance of payments

• Balance of trade

• Comparative advantage

• Embargo

If US sugar producers are struggling to compete with foreign sugar producers, which of the following would they mostly likely try to do?

• Ask Congress to create more regulations for US sugar producers

• Ask Congress to remove quotas on foreign sugar imports

• Ask Congress to remove tariffs on foreign sugar imports.

• Ask congress to subsidize the US sugar market

The US can produce more than Peru using the same resources. This example is best described by which word?

• Absolute advantage

• Economic appreciation

• Opportunity cost

• Trade surplus

A teacher who is lecturing on the advantages and disadvantages of international trade is most likely to include which of the following topics?

• Standards and quotas

• Inflation and stagflation

• Discount rates and reserve ratios

• CPI and unemployment

Exchange rates can be best described as

• A way to compare the price of one country's currency to another's

• A way to measure the size of one nation's economy to another

• The amount of money made from compound interest over simple interest

• A way to compare the quality of the goods produced by each country

Which of the following would be the most likely reason a government would impose a trade barrier such as a quota or standard?

• To raise the reserve ratio

• To increase the country's comparative advantage

• To increase economic interdependence

• To increase domestic profits

Which is the BEST reason for the US to initiate a trade embargo on another country?

• The country joins NAFTA

• The country raises it exchange rate

• The country has made threats against the US

• The country refuses to lower its exchange rate

Over the course of one year, the Japanese yen appreciates relative to the British pound. Who would benefit MOST from this occurrence?

• British consumers of British goods

• British consumers of Japanese goods

• Japanese consumers of British goods

• Japanese consumers of Japanese goods

A tariff placed on foreign steel imports represents

• A balance of payment deficit

• A barrier to trade

• A subsidy to domestic producers

• An increase in domestic production