International Trade Theories Quiz

Which economic theory promoted governmental regulation of a nation's economy for the purpose of augmenting state power at the expense of rival national powers?

• Socialism

• Communism

• Capitalism

• Mercantilism

Which concept in economics describes the scenario where one entity can manufacture a product at a higher quality and a faster rate for a greater profit than another competing business or country?

• Opportunity Cost

• Supply and Demand

• Comparative Advantage

• Absolute Advantage

What is the basis for the concept of absolute advantage in economics?

• Efficiency of producing a single product

• Opportunity Cost analysis

• Market Development

• Efficiency of producing multiple products

Which stage of the international product lifecycle is marked by fluctuating increase in prices, high profits, and promotion of the product on a huge scale?

• Maturity

• Saturation

• Introduction

• Growth

In the international product lifecycle, what happens during the maturity stage?

• Original exporter reduces prices to maintain market share

• Sales reach the peak with no further possibility for increase

• Duplicate products are reported in foreign markets

• Sales volumes decrease

What is the opportunity cost of choosing one option over the other in economics?

• The value lost from producing a product

• The forfeited benefits from choosing an alternative

• The profit gained from choosing an alternative

• The difference in value lost from choosing one option over the other

Which theory in economics describes how a company evolves over time and across national borders?

• Market Development Theory

• Supply and Demand Theory

• Economies of Scale Theory

• International Product Lifecycle Theory

What is the final stage of the product lifecycle where sales volumes decrease and many products are removed or discontinued?

• Introduction

• Growth

• Maturity

• Decline

What is the 3rd stage in product life cycle?

• Growth

• Maturity

• Decline

• Introduction

In this stage, competition is still low but the sales volume grows rapidly. Which stage is this describe?

• Introduction

• Growth

• Maturity

• Decline