chapter 4

What does 'globalization' refer to?

• The process of all countries becoming politically united
• The development of world economies as independent systems
• The process by which the world economy becomes a single interdependent system
• The restriction of international trade

What is the main goal of the Gulf Cooperation Council (GCC)?

• Encouraging cooperation among European countries
• Eliminating trade barriers among Gulf states
• Promoting global environmental policies
• Setting tariffs for all international trade

What is an 'import'?

• A product made domestically and sold internationally
• A product grown abroad and sold domestically
• An item produced and consumed locally
• A service offered exclusively within a country's borders

Which organization was established in 1995 to help regulate global trade?

• International Monetary Fund (IMF)
• World Health Organization (WHO)
• World Trade Organization (WTO)
• European Union (EU)

What does 'Balance of Trade' measure?

• Total value of all imports
• Difference between the value of exports and imports
• Total value of all exports
• Level of a country's national debt

What is a 'trade surplus'?

• When imports exceed exports
• When exports exceed imports
• When imports and exports are equal
• When there is no international trade

Which of the following defines an 'absolute advantage'?

• Ability to produce something at lower cost or better quality than others
• Ability to produce more types of products than other countries
• Producing goods equally efficiently as other countries
• Producing goods without international competition

What is an example of 'comparative advantage'?

• China’s production of clothing and furniture more efficiently than other countries
• Saudi Arabia producing oil at a higher quality
• Canada's focus on exporting raw materials
• The U.S. restriction of goods imports

What does a 'quota' do in international trade?

• It bans all imports from a specific country
• It taxes all imported goods equally
• It limits the quantity of a specific product that can be imported
• It provides subsidies for domestic products

What is an 'embargo'?

• A ban on a specific product from being exported
• A limitation on the quantity of a product to be imported
• A complete ban on trade with a particular country
• A tax on specific imported goods