Question # 1

An important feature of a___ is that the holder has the right , but not the obligation, to buy or sell currency

Choose an answer

Swap

Foreign exchange arbitrage

Foreign exchange option

Futures market contract

A country transactions with the rest of the world are recorded in the

Choose an answer

Balance of international indebtedness

Balance of financial transactions

Balance of payments

Income statement

A product will be traded only if the pre trade price difference between the two countries

Choose an answer

Is less than the cost of transporting it between them

is greater than the cost of transporting it between them

Equals the cost of transporting it between them

More information is needed to answer this question

The relationship between the exchange rate ad the prices of tradable goods is known as the.

Choose an answer

Purchasing power parity theory

Asset markets theory

Monetary theory

Balance of payments theory

The difference between what consumers have to pay for a particular and what they are willing to pay is known as.

Choose an answer

Consumer surplus

Producer surplus

Dead weight costs

Dead weight surplus

To stabilize the prices of primary products international commodity agreements have utilized all of the following except.

Choose an answer

Tariff -rate quotas applied to imported goods.

Production and export controls.

Buffer stocks

Multilateral contracts

A primary reason why nations conduct international trade is because.

Choose an answer

some nations prefer to produce one thing while others produce another.

Resources are not equally distributed to all trading nations

Trade enhances opportunities to accumulate profits

Interest rates are not identical in all trading nations

A widely used indicator to differentiate developed countries from developing countries is.

Choose an answer

International trade per captia

Real income per capita

Unemployment per capita

Calories per capita

_____________ represent the most widely used tool in international finance for measuring the average value of a currency relative to a number of other currencies

Choose an answer

Nominal exchange rates

Real exchange rates

Cross exchange rates

Exchange rate indexes

Which exchange rate system does not require monetary reserves for official exchange rate intervention.

Choose an answer

Floating exchange rates

Pegged exchange rates

Managed floating exchange rates

Dual exchange rates

In the balance of payments, travel and tourism are included in the category of

Choose an answer

unilateral transfers

Capital account

Merchandise account

Services account

That the division of labor is limited by the size of th market best applies to which explanation of trade.

Choose an answer

Factor endowment theory

Product like cycle theory

Economics of scale theory

Over lapping demand theory

The product cycle theory of trade is essentially a

Choose an answer

Static short run trade theory

Dynamic, long run trade theory

Zero sum theory of trade

Negative sum theory of trade

International trade is based o the notion that.

Choose an answer

Different currencies are an obstacle to international trade

Goods are more mobile internationally than are resources

Resources are more mobile internationally that are goods

A country's exports should always exceeds its imports

Exchange rate overshooting often occur because.

Choose an answer

Domestic prices adjust slowly to shifts in demand

Military spending increases during military's confects

Elasticities are smaller in the long run than the short run

Elasticities are smaller in the short run than the long run.

Trade based on comparative advantage assures that.

Choose an answer

Only the strongest suvrive

Some people are rich and others are poor

Each item is produced using the least amount of time needed to produce it

Each item is produced at as low a cost possible in terms of other things given up

The gain from international trade are closely related to.

Choose an answer

the labor theory of value

How much the autarky price differs from international terms of trade change.

The fact that a country must lose from trade

All of the above

According to the Heckscher - Ohlin model

Choose an answer

^{Every one automatically gains from trade}

The gainers from trade out number the losers from trade

The scarce factor necessary gains from trade

None of the above

Specific tariffs are collected as

Choose an answer

Fixed amount of money per unit traded

a percentage of the price of the product

A percentage of the quantity of imports

All of the above

The factor endowment theory was pioneered by

Choose an answer

Adam Smith

David Richardo

Wassily Leontief

Ell Heckscher and Bartill Ohlim

To be considered a good candidate for an export cartel a commodity should.

Choose an answer

Be a manufactured good

Be a primary product

Have a high price elasticity of supply

Have a low price elasticity of demand

More Classes

Other Links

PPSC Economics Chapter 5 International Economics MCQs With Answers

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer