International Trade Test

What is international trade?

• The exchange of goods within a country

• The exchange of capital, goods, and services across international borders

• The process of manufacturing goods

• The distribution of products within cities

Which factor has NOT contributed to the rapid growth of international trade?

• Technological advancements

• Trade agreements

• Local transportation systems

• Communication innovations

What is globalization?

• The process of selling goods only within one's own country

• The decreasing connection between world economies

• The growing interdependence of world economies, cultures, and populations

• The isolation of national markets

Which statement best describes exports?

• Goods and services bought from other countries

• Goods and services produced and sold to other countries

• Products stored within a country

• Services used only by domestic consumers

What is absolute advantage?

• The ability to produce all types of goods

• The ability to produce a good at a lower cost than another country

• The ability to export more than import

• The ability to create trade barriers

What is comparative advantage?

• Having the most advanced technology

• Having the largest workforce

• Considering opportunity costs when choosing what to produce

• Having unlimited natural resources

Which is a benefit of international trade?

• Decreased consumer choices

• Higher prices for all goods

• Greater variety of goods for consumers

• Limited market access

What is a negative consequence of international trade?

• Worker displacement

• Increased product quality

• More consumer choices

• Economic efficiency

What is a trade deficit?

• When exports equal imports

• When a country exports more than it imports

• When a country imports more than it exports

• When there is no international trade

What is a trade surplus?

• When imports exceed exports

• When exports exceed imports

• When trade completely stops

• When countries have equal trade