International Trade MCQ
1. Economies of scale based intra-industry trade models are primarily drive by ______.
Answer
Correct Answer:
Differences in demand.
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2. Due to a nation's weak currency, people may have to fall back on __________.
Answer
Correct Answer:
Bartering.
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3. Using tariffs to generate government revenue is most common among ________.
Answer
Correct Answer:
Developing countries
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4. So ______ has a comparative advantage in producing ______.
Answer
Correct Answer:
Jim; trout
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5. What is the North American Free Trade Agreement?
Answer
Correct Answer:
A pact between the United States, Mexico, and Canada to improve trade
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6. Import quotas ______ consumer surplus.
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7. When tariffs are introduced, what happens to producer surplus?
Answer
Correct Answer:
It increases.
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8. What happens when a country exports a good?
Answer
Correct Answer:
Domestic consumers are negatively affected.
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9. How is consumer surplus affected by imports when free trade is allowed?
Answer
Correct Answer:
Increased
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10. Producer surplus refers to the difference between ______ and ______.
Answer
Correct Answer:
The lowest price a supplier is willing to accept for a good or service; the price it actually receives
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11. A footwear company can make either 100 shoes per hour or 200 sandals per hour. What is the opportunity cost of making sandals for two hours?
Answer
Correct Answer:
200 shoes
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12. Trade is based on ______, not ______.
Answer
Correct Answer:
Comparative advantage; using fewer resources
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13. When a country or region can produce a good or service at a lower opportunity cost than others, economists say it ______.
Answer
Correct Answer:
Has a comparative advantage
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14. English economist David Ricardo is remembered for developing which theory?
Answer
Correct Answer:
Comparative advantage
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15. The largest percentage of goods imported into the United States come from ______.
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16. Which of the following are goods included among top U.S. exports?
Answer
Correct Answer:
Automobiles and aircraft
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17. A country with few international trading partners is called ______.
Answer
Correct Answer:
A closed economy
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18. Which of the following has helped to increase international trade?
Answer
Correct Answer:
Improved transportation methods and speeds
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19. International trade exists because ______.
Answer
Correct Answer:
Countries benefit by exchanging goods they have for those they lack
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20. A tax on imports is called ______.
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21. Efforts by producers to gain profits from government protections such as tariffs and import quotas is called rent seeking.
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22. Import quota is a _____ limit on the imported quantity that is produced abroad.
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Microeconomics MCQs | Topic-wise
