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| 1 | |
The United States has many trading partners around the world. Of all of these trading partners, _______________ leads in total trade with $371.4 billion in exports and imports. |
| | A) | the United Kingdom |
| | B) | Japan |
| | C) | Mexico |
| | D) | Canada |
| | E) | Taiwan |
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| 2 | |
According to information presented in the text, which of the following events marred the first half of the twentieth century to such an extent that it took most of the last half of the century for most of the industrialized world to recover? |
| | A) | the nuclear arms race |
| | B) | World War I |
| | C) | World War II |
| | D) | the polio epidemic |
| | E) | the Great Depression |
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| 3 | |
If a country sells more to other countries than it buys from them, the situation is called a favorable: |
| | A) | balance of trade. |
| | B) | economic model. |
| | C) | management structure. |
| | D) | tariff management scheme. |
| | E) | marriage between government and industry. |
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| 4 | |
A statement that records all financial transactions between a nation's residents and those of the rest of the world during a given period of time (usually one year) is called a nation's: |
| | A) | balance of trade. |
| | B) | balance-of-payments. |
| | C) | import-export statement. |
| | D) | supply-demand statement. |
| | E) | none of the above. |
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| 5 | |
Within the balance-of-payments statement, the ___________ account is a record of all exports and imports of gold, increases or decreases in foreign exchange, and increases or decreases in liabilities to foreign central banks. |
| | A) | current |
| | B) | capital |
| | C) | reserves |
| | D) | wealth |
| | E) | power |
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| 6 | |
If a nation uses tariffs, quotas, and nontariff barriers to restrict trade so that domestic industries can flourish, it may be guilty of what is called: |
| | A) | embargoes. |
| | B) | boycotts. |
| | C) | protectionism. |
| | D) | monopolistic thinking. |
| | E) | predatory pricing. |
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| 7 | |
All of the following are arguments that favor protectionism EXCEPT: |
| | A) | increase of business size. |
| | B) | maintenance of employment and reduction of unemployment. |
| | C) | conservation of natural resources. |
| | D) | national defense. |
| | E) | all of the above are correct arguments for protectionism. |
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| 8 | |
If a government wants to tax goods entering at its borders, it will impose what is called a(n): |
| | A) | quota. |
| | B) | voluntary export restraint. |
| | C) | orderly market agreement. |
| | D) | tariff. |
| | E) | standard monetary barrier. |
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| 9 | |
A(n) __________ will generally increase inflationary pressures, weaken balance-of-payments positions, and restrict manufacturers' supply sources. |
| | A) | quota |
| | B) | voluntary export restraint |
| | C) | orderly market agreement |
| | D) | tariff |
| | E) | standard monetary barrier |
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| 10 | |
If Germany limits the number of Japanese ball bearings that may enter its country to protect its domestic industry and reduce reliance of foreign supply, it is using a(n) _______ as a trade barrier. |
| | A) | quota |
| | B) | voluntary export restraint |
| | C) | orderly market agreement |
| | D) | tariff |
| | E) | standard monetary barrier |
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| 11 | |
If the United States were to place an absolute restriction against the purchase and importation of Libyan oil as a punishment for perceived support of global terrorism, the United States would have imposed which of the following against Libya? |
| | A) | embargo |
| | B) | boycott |
| | C) | standard restriction |
| | D) | import quota |
| | E) | export restraint |
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| 12 | |
One of the weapons used by the United States against global terrorism is a monetary barrier called ______________ where the U.S. refuses to allow importers to exchange its national currency for the seller's currency. |
| | A) | differential exchange rate |
| | B) | export restraint |
| | C) | valuation systems |
| | D) | blocked currency |
| | E) | fees |
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| 13 | |
Different ____________ are a major source of trade difficulties between the U.S. and Japan. For example, the size of knotholes in plywood shipped to Japan can determine whether or not the shipment is accepted. This becomes an issue of perceived quality. |
| | A) | valuation systems |
| | B) | export systems |
| | C) | standards |
| | D) | measurements |
| | E) | none of the above is correct |
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| 14 | |
A Japanese chip manufacturer is intentionally selling its chips in the United States for less than the cost of production. It is doing this to undermine the U.S. competition and to take control of the U.S. chip market. Such a company would be correctly accused of __________ pricing. |
| | A) | demand-based |
| | B) | supply-based |
| | C) | monopolistic |
| | D) | predatory |
| | E) | competitive |
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| 15 | |
Which of the following treaties paved the way for effective a worldwide tariff agreement? |
| | A) | WTO |
| | B) | GATT |
| | C) | NAFTA |
| | D) | NATO |
| | E) | EC |
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