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Global Economics
Global Economics
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A review game for Global Economics unit test.
Flashcards
30 cards
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Practice quiz
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Host live
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Questions
30
Answers
1
Which industries tend to receive trade restriction protection from their government.
Comparative advantage relative to foreign producers
Comparative disadvantage relative to foreign producers
Comparative advantage relative to domestic producers
Comparative disadvantage relative to domestic producers
2
By definition, what is the increasingly integrated global economy.
Globalization
Tariffs
Protectionist policies
Trade Blocs
3
When a foreign government offers it's producers a subsidy: the domestic argument for protection
Infant Industry
Domestic jobs
National Defense
Level playing field
4
ER= $1 for 0.80 Euros: When you return from Europe and exchange 100 Euros, how many dollars?
$75
$100
$125
$80
5
The market price for Brazilian Reals as people arrive in Brazil for the summer Olympics.
Increases (appreciates) against ALL currencies
Decreases (depreciates) against the $
Increases (appreciates) against the $
Stays the same
6
Argument: We need to protect business in peace time so it is still around during times of war.
Government Revenue
Domestic jobs
Level Playing Field
National defense
7
Eliminates trade barriers among members, maintains independent policies for nonmembers. ExNAFTA
Free Trade Area
Common Market
Economic Union
Customs Union
8
What happens to the price for $ as the U.S. tightens travel restrictions, reducing tourism.
↓D for $ therefore $ depreciates
↑D for $ therefore $ appreciates
↓S for $ therefore $ depreciates
↑S for $ therefore $ appreciates
9
The organization that removes trade restrictions from infant industries.
WTO (World Trade Organization)
Congress
GATT (General Agreement on Tariffs and Trade)
ITC (International Trade Commission)
10
All of the following are challenges faced by LDCs EXCEPT:
communication
exchange rates
political stability
transportation
11
The balance of payments account where we record a French investor's stock purchase of Apple.
Financial Account
Official Reserves
Current Account
World Trade Account
12
All of the following are included in the current account EXCEPT:
factor payments
balance of payments
net transfers
good and services
13
What is the effect on investment in an LDC as political stability increases.
Increases
LDCs never improve their political stability
Stays the same
Decreases
14
Does not address nonmembers, lowers but does not eliminate trade barriers.
Preferential Trade Area
Free Trade Area
Customs Union
Common Market
15
What happens to the market price for dollars: Fed buys bonds in order to expand the economy.
Increase Ms, decrease int. rates, decrease D for $
Decrease Ms, increase int. rates, increase D for $
Increase Ms, decrease int. rates, increase D for $
Decrease Ms, increase int. rates, decrease D for $
16
2 examples why LDCs have lower literacy rates
Educated citizens leave, gov'ts overspend on education
Older generation security, gov'ts overspend on education
Needed to farm, guaranteed school for all
Needed to Farm, older generation security
17
Which of the following is NOT a reason people need foreign currency?
Investment
International Trade
Protectionist trade policies
Travel and tourism
18
Why is "government revenue increase" a bad argument for trade restrictions in the U.S.
The higher price will increase supply from foreign producers
Generates very little of our revenue
Leads to increases in foreign trade
Government gains, producers don't
19
A foreign government agrees to restrict trade of its own exports into another market
Tariff
Quota
Health and Safety Restriction
Voluntary Export Restraint (VER)
20
Elims trade barriers among members, adopt common policies for nonmembers. Russia/Kazak/Belarus
Economic Union
Common Market
Customs Union
Free Trade Area
21
Elims trade barr among members, common policies for nonmembers, free movement of res. Mercosur
Customs Union
Preferential Trade Area
Free Trade Area
Common Market
22
Which organization settles international trade disputes?
World Trade Organization (WTO)
International Trade Commission (ITC)
General Agreement on Tariffs and Trade (GATT)
World Bank
23
No barriers members, free movement of resources, uniform set of economic policies. Ex: EU
Economic Union
Free Trade Area
Common Market
Customs Union
24
Unfair advantages offered to domestic industries can often lead to:
trade deficits for all involved
trade wars
decreases in price in both domestic and in foreign markets
lawsuits brought before the IMF
25
The effect on British exports to the U.S. as the pound depreciates in value against the dollar.
There will be no change in British exports
Increase as British products are relatively less expensive
Decrease as British products are relatively more expensive
Decrease as U.S. products are relatively less expensive
26
Who receives subsidies from their government when attempting "export promotion"?
Foreign Consumers
Domestic Producers
Domestic Consumers
Foreign Producers
27
Which of the following combinations are examples of NTBs?
VERs and WTO
Health and Safety Restrictions and Quotas
Quotas and tariffs
VERs and Tariffs
28
What is the effect on U.S. jobs if our government places a tariff on Mexican textiles.
Decrease U.S. textile jobs, increase in other industry jobs
Increase Mex textile jobs, decrease in other industry jobs
Increase U.S. textile jobs, decrease in other industry jobs
Increase U.S. textile jobs, increase in other industry jobs
29
compared with free trade, a tariff imposed on French perfume imported into the U.S. tends to:
↑ market price and ↑imports
↓ market price and ↑imports
↑ market price and ↓imports
↓ market price and ↓imports
30
Why do countries specialize and what types of goods do they trade?
Makes everyone better off/trade where comparative adv.
Makes everyone worse off/trade where comparative disadv.
Makes everyone worse off/trade where comparative adv.
Makes everyone better off/trade where comparative disadv.
