Quiz 1 - Final ECO 4451

The natural gas turbine is considered a driver of globalization because the turbine

• increases efficiency, moving goods from place to place.

• is associated with increased transportation costs.

• increases the labor input and decreases unemployment.

• was developed in the United States.

1. The term economic interdependence implies that the wealth and success of one country impacts the wealth and success of another country.

• True

• False

1. The openness ratio is measured by a country's

• exports minus imports as a percent of gross domestic product.

• imports as a percent of gross domestic product.

• exports as a percent of gross domestic product.

• exports plus imports as a percent of gross domestic products.

1. With globalization and import competition, U.S. prices generally

• increase.

• fluctuate wildly.

• remain stable.

• decrease.
  

1. Which of the following is a disadvantage of globalization?

• Global competition and cheap imports keep a constraint on prices.

• Companies building state-of-the-art factories in low-wage countries.

• Easier access to foreign investment and low interest rates.

• Living standards can increase more rapidly.

1. Which statement is true about import restrictions?

• They decrease the volume of exports.

• They lead to more jobs for domestic workers.

• They decrease imports and increase exports.

• They are more conducive to prosperity than free trade.

1. The decline of Kodak Inc. in the camera and film business is NOT explained by

• the development of digital cameras and smartphones that operate as cameras.

• the rise of Japanese rivals such as Fuji Photo Film Co.

• constant innovation and attention to changing trends in recreational photography.

• antimonopoly laws that broke Kodak up into small, competing companies.

1. Which of the following is a fallacy of international trade?

• Trade is a zero-sum activity.

• Exports increase employment in exporting industries.

• Import restrictions increase employment in import-competing industries.

• Tariffs and quotas reduce trade.

1. The phrase “When the United States sneezes, the economies of other nations catch a cold” was first used to describe the impact of the economy of the United States on the rest of the world at the end of World War II. This phrase is now

• more true, due to the impact of growing economic interdependence.

• less true, due to the impact of growing economic interdependence.

• only true when followed by impacts in the European Union.

• all of these are only true in the case of an economic recession.

1. Multilateral trade negotiations have led to

• higher tariffs.

• increased protectionism.

• more expensive financing.

• continued liberalization of trade and investment.