What is the main purpose of NAFTA?

To increase trade by creating a free trade zone

Why must people exchange currency?

Because different countries have different currencies

Why is it dangerous for Venezuela to depend so heavily on specializing in one product?

A drop in oil price could destroy the country’s economy

How does a command economic system answer the three economic questions?

Government makes ALL economic decisions

Why is Mexico's economy considered a Mixed economy?

Business decide how to produce goods, the government regulates some things

What are two advantages to specialization?

Lower costs & faster production

Why must country’s engage in specialization?

No one has all of the resources necessary to produce everything

Why did the US place an embargo on Cuba in the 1960s?

To stop the spread of Communism and siding with the Soviet Union

Why is international trade important for Brazil’s agricultural production?

Brazil has tons of resources and can sell its goods all over the world

Why would a country’s government set up a quota on foreign goods?

To protect its own businesses from foreign competition

Complete ban on trading between two countries

What does a quota do?

Restricts the quantity of an item that is brought into a country

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Latin America Economic Systems and Voluntary Trade

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Questions 15

Answers

1
What is the main purpose of NAFTA?
To increase the National Federal Reserve of gold
To bring in 10 more teams to the NFL
To increase trade by creating a free trade zone
2
Why must people exchange currency?
Because different countries have different currencies
Because they are buying goods and services
Sometimes currency gets old and needs to be replaced
3
Why is it dangerous for Venezuela to depend so heavily on specializing in one product?
A plague could wipe out all of the cows and the people would starve
A drop in oil price could destroy the country’s economy
The rainforest could run out of trees and the country would go broke
4
What type of trade barrier involves adding a special tax on imported goods?
Tariff
Quota
Embargo
5
Which countries are involved in NAFTA?
US, Canada, & Mexico
Germany, France & Italy
Europe, Africa & Asia
Cuba, Mexico & Brazil
6
How does a command economic system answer the three economic questions?
Government makes ALL economic decisions
Government makes some economic decisions
The people makes some economic decisions
The people make ALL economic decisions
7
Why is Mexico's economy considered a Mixed economy?
Mexico uses a traditional economic system
The people control all aspects of business
Business decide how to produce goods, the government regulates some things
The government controls all aspects of business
8
What are two advantages to specialization?
Higher costs & slower production
Lower costs & faster production
Lower costs & slower production
Higher costs & faster production
9
Why must country’s engage in specialization?
So they can be the best at something
No one has all of the resources necessary to produce everything
To beat other countries with their economy
10
Why did the US place an embargo on Cuba in the 1960s?
To stop the spread of Communism and siding with the Soviet Union
To destroy a powerful competitor in the sugar cane business
To stop Cuba from destroying the American economy
11
Why is international trade important for Brazil’s agricultural production?
Brazil has too much food and needs to ship it before it spoils
Brazil doesnt need anything so they can only sell overseas
Brazil has tons of resources and can sell its goods all over the world
12
Why would a country’s government set up a quota on foreign goods?
To stop goods from coming into the country
To disrupt the foreign countries economy
To protect its own businesses from foreign competition
13
What kind of economic system does Mexico (and all other countries) have?
Market
Traditional
Command
Mixed
14
What is an embargo?
Complete ban on trading between two countries
Places a tax on good coming into a country
To limit how man goods can come into a country
15
What does a quota do?
Restricts the quantity of an item that is brought into a country
Bans a country from trading with another country
Adds and extra tax to a good coming into the country

Latin America Economic Systems and Voluntary Trade Flashcards | StudBud