| 1. |
International trade increases the welfare of ________________ |
| A. | only developed countries |
| B. | only exporting countries |
| C. | all participating countries |
| D. | only importing countries |
| Answer» C. all participating countries | |
| 2. |
Ricardian theory assumes that labour is ________________ within the country. |
| A. | inefficient |
| B. | heterogeneous |
| C. | homogeneous |
| D. | sufficient |
| Answer» C. homogeneous | |
| 3. |
Income terms of trade indicate increased capacity to ________________. |
| A. | export |
| B. | import |
| C. | profit |
| D. | investment |
| Answer» B. import | |
| 4. |
An offer curve differs from ________________. |
| A. | usual demand curve |
| B. | usual supply curve |
| C. | indifference curve |
| D. | usual demand and supply curve |
| Answer» D. usual demand and supply curve | |
| 5. |
Utility terms of trade was introduced by ________________. |
| A. | jacob viner |
| B. | frank taussig |
| C. | j. s. mill |
| D. | adam smith |
| Answer» A. jacob viner | |
| 6. |
When supply of exports is elastic, a country will have ________________ terms of trade. |
| A. | unfavorable |
| B. | favorable |
| C. | income |
| D. | different |
| Answer» B. favorable | |
| 7. |
Hecksher-Ohlin theory states that the relative factor prices in two countries are determined by ________________. |
| A. | labour efficiency |
| B. | capital efficiency |
| C. | technological developments |
| D. | differences in factor endowments |
| Answer» D. differences in factor endowments | |
| 8. |
________________ is not an objective of commercial trade policy. |
| A. | to determine the rate of interest |
| B. | to protect domestic industries from foreign competition |
| C. | to preserve foreign exchange reserves |
| D. | to maintain favorable balance of payments |
| Answer» A. to determine the rate of interest | |
| 9. |
Tariff rate quotas are ________________ |
| A. | based on the value of the traded commodity only |
| B. | low tariff rate on an initial quantity of import within the quota limit and very high tariff rate on imports above the initial amount |
| C. | based on the quantity or volume of the quantity only |
| D. | combination of tariffs and quotas |
| Answer» B. low tariff rate on an initial quantity of import within the quota limit and very high tariff rate on imports above the initial amount | |
| 10. |
Which of the following is not a NTB? |
| A. | voluntary export restrictions |
| B. | administrative barriers |
| C. | tariff rate quotas |
| D. | local content requirement |
| Answer» C. tariff rate quotas | |
| 11. |
A free trade area is a trade bloc where ________________ |
| A. | countries agree to have a common unified tariff against non-members |
| B. | countries agree to reduce or eliminate tariff barriers on selected goods imported from other member nations |
| C. | countries agree to reduce or eliminate tariff barriers on all goods imported from other member nations |
| D. | all barriers are eliminated to allow free movement of goods, services, capital and labour |
| Answer» C. countries agree to reduce or eliminate tariff barriers on all goods imported from other member nations | |
| 12. |
The ________________ was signed to create the EU in 1993. |
| A. | treaty of london |
| B. | treaty of maastricht |
| C. | treaty of lisbon |
| D. | treaty of rome |
| Answer» B. treaty of maastricht | |
| 13. |
ASEAN was formed in ________________ |
| A. | 1967 |
| B. | 1945 |
| C. | 1999 |
| D. | 2000 |
| Answer» A. 1967 | |
| 14. |
________________ refers to the alliance of multiple countries pursuing common goals. |
| A. | single market |
| B. | multilateralism |
| C. | customs union |
| D. | regionalism |
| Answer» B. multilateralism | |
| 15. |
WTO was set up on ________________ |
| A. | 31st july, 1995 |
| B. | 1st january, 2000 |
| C. | 1st june, 1985 |
| D. | 1st january, 1995 |
| Answer» D. 1st january, 1995 | |
| 16. |
In the past several years, India's net invisibles were in ________________ |
| A. | surplus |
| B. | deficit |
| C. | balance |
| D. | unbalance |
| Answer» A. surplus | |
| 17. |
Private transfers on India's current account include ________________. |
| A. | local withdrawal from nri rupee deposits |
| B. | foreign currency deposits |
| C. | foreign exchange reserves |
| D. | portfolio investment |
| Answer» A. local withdrawal from nri rupee deposits | |
| 18. |
The highest authority of WTO is ________________. |
| A. | the dispute settlement body |
| B. | the ministerial conference |
| C. | the trade policy review body |
| D. | the general council |
| Answer» B. the ministerial conference | |
| 19. |
________________ is not a direct measures to correct BoP disequilibrium. |
| A. | tariffs |
| B. | devaluation of exchange rate |
| C. | import substitution |
| D. | quotas |
| Answer» B. devaluation of exchange rate | |
| 20. |
Portfolio foreign investment is included in ________________ account of BoP. |
| A. | capital |
| B. | trade |
| C. | debit |
| D. | current |
| Answer» A. capital | |
| 21. |
Forward market in foreign exchange refers to ________________ market. |
| A. | a long run |
| B. | a short run |
| C. | a spot |
| D. | short and long run |
| Answer» D. short and long run | |
| 22. |
________________ is not a detect of flexible exchange rate. |
| A. | speculation |
| B. | structural unemployment |
| C. | stability in international monetary system |
| D. | discourages investments |
| Answer» C. stability in international monetary system | |
| 23. |
The function of foreign exchange market that helps in clearing international transactions is known as ________________. |
| A. | speculation |
| B. | hedging |
| C. | transfer |
| D. | credit |
| Answer» C. transfer | |
| 24. |
When the demand curve for foreign currency, intersects the supply curve, we get ________________ exchange rate. |
| A. | par |
| B. | discount |
| C. | equilibrium |
| D. | premium |
| Answer» C. equilibrium | |
| 25. |
________________ of goods results in demand for foreign currency. |
| A. | sale in inter-national market |
| B. | export |
| C. | sale in domestic market |
| D. | import |
| Answer» D. import | |
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