International Trade quizz 1

1. Processing is a mode of producing goods in which an outsourcer supplies raw materials and semi-finished products to the processor. Processors shall produce and deliver final products upon request to the outsourcers and receive ________.

• A. wages

  
  

• B. production expenses

• C. processing fee

  
  

• D. transportation cost

2. According to the gravity model,_________.

• A. The volume of goods traded decreases with the size and with proximity of trading partners.

• B. The volume of goods traded increases with the size and with proximity of trading partners

  
  

• C. The volume of goods traded increases with the size and decreases with proximity of trading partners.

• D. The volume of goods traded decreases with the size and increases with proximity of trading partners.

3. According to David Ricardo, a country will have a comparative advantage in the product in which its__________.

• A. labor productivity is relatively low

• B. labor productivity is relatively high

• C. labor mobility is relatively low

• D. labor mobility is relatively high

4. External economies of scale occur when cost per unit of output depends on _________, not necessarily on _________. Larger industry leads to the number of firms___________.

• A. the size of one firm - the size of the industry - increasing

• B. the size of one firm - the size of the industry - decreasing

• C. the size of the industry - the size of one firm - increasing

• D. the size of the industry - the size of one firm - decreasing

5. “If we hold output prices constant, as a factor of production increases, then the supply of the good that uses this factor intensively increases and the supply of the other good decreases.” This is_________.

• A. The Rybczynski theorem

• B.The Stolper-Samuelson theorem

• C.The Heckscher-Ohlin theorem

• D. The factor-price equalization theorem.

7. A Korean expert provides a service within Mexico as an independent business consultant. This is an example of which type of trade activities?

(Một chuyên gia Hàn Quốc cung cấp dịch vụ tại Mexico với tư cách là cố vấn kinh doanh độc lập. Đây là ví dụ về loại hoạt động thương mại nào?)

• A.Mode 1: Cross-border supply (Cung ứng xuyên biên giới)

• B.Mode 2: Consumption abroad (Tiêu dùng ở nước ngoài)

• C. Mode 3: Commercial presence (Hiện diện thương mại)

• D. Mode 4: Natural persons presence (Hiện diện cá nhân)

A primary reason why nations conduct international trade is because____________.

• A.Some nations prefer to produce one thing while others produce another

• B.Resources are not equally distributed to all trading nations

• C. Trade enhances opportunities to accumulate profits

• D. Interest rates are not identical in all trading nations

C: Cloth

F: Food

If PC/PF were to increase in the international marketplace, then___________.

• A. all countries would be better off

• B. the terms of trade of cloth exporters improve

• C. the terms of trade of food exporters improve

• D. the terms of trade of all countries improve

10. Canada exports syrup to the US, while imports computers from the US. Syrup-biased growth in Canada will________.

• A..improve the terms of trade of Canada

• B. worsen the national income of the US

• C. better off

  
  

• D. improve the national welfare of the US

11. At the industry's long-run equilibrium, companies in monopolistic competition will earn_____ economic profit.

• A. Positive

• B.Negative

• C. Zero

• D.Undefined