Ch 17 Quiz Resources for Global Trade

What is the best explanation for why countries trade with each other?

• to influence the political situation in another country

• to create multinational corporations

• to exchange the items each produces more efficiently

• to provide fresh foods for their citizens

To determine a country’s specialization, look at its ____________________________.

• imports

• exports

• real GDP

• net national product

If Country A can produce computers more efficiently than can Country B, Country A has a(n) ____________________________.

• comparative advantage

• opportunity cost

• absolute advantage

• trade surplus

Although Country C can produce more cashews than Country D, Country D can produce cashews with relatively greater efficiency. What kind of advantage does Country D have over Country C?

• cost

• absolute

• opportunity

• comparative

What is a non-production benefit of international trade?

• political cooperation

• greater world output

• multinational corporations

• automation of the workforce

International trade helps a country’s economy by providing two sources of economic growth, which are ____________________________.

• access to necessary inputs and bigger markets

• bigger markets and more jobs

• more jobs and larger incomes

• larger incomes and access to necessary inputs

What type of restriction does a country place on international trade when it charges a high tax on an import from another country to help a competing domestic industry thrive?

• quota

• embargo

• revenue tariff

• protective tariff

People are often willing to support restrictions that protect infant industries on the condition that these protections are (a)   .

• implemented to support national defense

• enforced only during periods of international conflict

• eventually removed, forcing the industries to compete

• accompanied by other protections that produce revenue

What is the most frequently used argument for placing restrictions on international trade?

• keeping money at home

• protecting domestic jobs

• supporting national pride

• helping the balance of payments

The term foreign exchange refers to

• international trade

• the different currencies used in international trade

• a location where international trade deals are negotiated

• a multinational stock market