WorksheetsUnit 17: International Trade
Total questions: 25
Worksheet time: 13mins
__________ refers to the purchase, sale, or exchange of goods and services across national borders.
A. Free trade
B. International trade
C. Protectionism
D. Trade barrier
_________ refers to the restriction on the amount of a good that can enter or leave a country during a certain period of time.
A. Tariff
B. Quota
C. Trade barrier
D. Dumping
A tariff is a _________ (or tax) levied upon goods transported from one Customs area to another, for either protective or revenue purposes.
A. Quota
B. Subsidy
C. Duty
D. Embargo
What is the absolute advantage of a nation?
A. The ability to produce a good more efficiently than any other nation.
B. The ability to produce a good less efficiently than other nations but at a lower cost.
C. A strategy to protect domestic industries from foreign competition.
D. The restriction of trade between two countries.
An infant industry is a _________, which in its early stages experiences relative difficulty or is absolutely incapable of competing with established competitors abroad.
A. Strategic sector
B. Established business
C. New industry
D. Globalized company
A strategic industry is an industry which is _________ for the promotion or stabilization of the growth of the locality in which that industry is situated.
A. Unnecessary
B. Essential
C. Unstable
D. Global
Protectionism is the economic policy of restraining trade between nations, through methods such as _________ on imported goods.
A. Tariffs
B. Subsidies
C. Export quotas
D. Free market policies
A trade barrier is a government law, regulation, policy, or practice that either protects domestic products from foreign competition or artificially _________ exports of particular domestic products.
A. Stimulates
B. Restricts
C. Discourages
D. Eliminates
What is the main purpose of imposing tariffs?
A. To make imports cheaper than domestic products
B. To raise government revenue and protect local industries
C. To encourage dumping of foreign goods
D. To promote free trade globally
Which of the following is an example of a Trade Barrier?
A. Free market policies
B. Subsidizing local industries
C. Import tariffs and quotas
D. Encouraging foreign investment
Which of the following is an argument against Free Trade?
A. It reduces consumer prices
B. It promotes international peace
C. It undermines infant industries
D. It increases market access for exporters
Why do developing countries often implement protectionist policies?
A. To boost exports of luxury goods.
B. To protect their emerging industries until they become competitive.
C. To avoid international trade agreements.
D. To focus solely on agricultural production.
What is the primary challenge faced by local consumers in countries practicing protectionism?
A. Limited access to imported goods.
B. A lack of competition among foreign producers.
C. Higher prices and lower quality domestic products.
D. Overreliance on international trade agreements.
What is the long-term benefit of protecting local industries in international trade?
A. Increased dependency on foreign markets.
B. Creation of globally competitive domestic industries.
C. Elimination of trade tariffs.
D. Reduction in the number of trade agreements.
What is the main reason governments impose tariffs?
A. To discourage international trade.
B. To make imports more expensive than domestic products.
C. To encourage dumping in foreign markets.
D. To reduce government revenue.
Why might a country use quotas instead of tariffs?
A. To generate revenue from imports.
B. To directly limit the number of imported goods.
C. To avoid diplomatic conflicts with trade partners.
D. To encourage free trade agreements.
What is a major disadvantage of protectionism in international trade?
A. It leads to long-term economic stability.
B. It restricts domestic industries from competing internationally.
C. It reduces consumer access to affordable foreign goods.
D. It increases competition within local markets.
Why do developing countries often resist free trade in their early stages of development?
A. They lack natural resources to export.
B. They aim to protect local industries from foreign competition.
C. They prefer relying on agricultural imports.
D. They have a strong comparative advantage in all sectors.
Which factor often leads countries to reduce protectionism?
A. The success of free trade in developed nations.
B. Increasing foreign debt and IMF conditions.
C. Overproduction in domestic markets.
D. Lack of competition among local industries.
Which international agreement aimed to reduce trade barriers and promote global trade?
A. The North American Free Trade Agreement (NAFTA).
B. The General Agreement on Tariffs and Trade (GATT).
C. The International Monetary Fund (IMF).
D. The World Bank Agreement.
Which of the following is an example of a Strategic Industry?
A. Textile manufacturing.
B. Defense and agriculture.
C. Tourism and hospitality.
D. Entertainment production.
The term Dumping in International Trade refers to:
A. Selling goods abroad at artificially low prices.
B. Imposing high tariffs on imported products.
C. Protecting local industries through quotas.
D. Encouraging domestic industries to export goods.
What is the primary purpose of an Embargo?
A. To encourage trade partnerships.
B. To ban the trade of specific goods or trade with a country entirely.
C. To provide financial support to foreign industries.
D. To promote free trade policies globally.
What does the term Barriers to Trade include?
A. Subsidies to encourage exports.
B. Tariffs, quotas, and non-tariff barriers.
C. Lowering tariffs to promote free trade.
D. Removing restrictions on imports.
What factor often leads developing countries to reduce protectionism and embrace trade liberalization?
A. Pressure from the IMF and foreign creditors.
B. Decreased competition in global markets.
C. Rising prices of imported goods.
D. Increased dependency on agricultural exports.
