International Economics Second Edition By Feenstra – Test Bank
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Name TestBanks Chapter 11: International Agreements: Trade, Labor, and the Environment
Description Question pool for TestBanks Chapter 11: International Agreements: Trade, Labor, and the Environment Instructions
Multiple Choice 0 points
Question
During which round of negotiations did the WTO toughen its stance against domestic policies that limit trade?
Answer Bretton Woods
Uruguay
Doha
The WTO never toughened its stance against domestic policies.
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Where was the Climate Summit held in December 2009?
Answer Brussels
New York
Seattle
Copenhagen
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What was the result of the Climate Summit held in December 2009? Add Question Here
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Answer All countries signed binding agreements to reduce their greenhouse gases by 20% during the next 10 years.
No countries signed binding agreements to reduce their greenhouse gases.
Only developed industrialized countries agreed to reduce their greenhouse gases by 20% during the next 10 years.
Only China and India agreed to reduce their greenhouse gases by 20% during the next 10 years.
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The World Trade Organization is called a _______________ because it involves many if not most of the nations in the world.
Answer bilateral trade organization
trilateral trade organization multilateral trade agreement quasi-political trade organization
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A regional trade agreement involves:
Answer most if not all the nations in the world. several nations, usually trading partners, with a common agenda or geographically linked.
nations who agree to trade only with nations in their region. a region of the world with not only trade issues but also political cohesiveness.
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In which type of trade agreement does the WTO allow exclusions to the most favored nation principle?
Answer multilateral trade agreements
free-trade areas customs unions
free-trade areas and customs unions
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Many regional trade agreements include other provisions that are not part of the treaty, but they are add-ons that might be important to trade issues. These are called:
Answer addenda.
side agreements. environmental pacts. worker rights documents.
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Which of the following is not a part of the NAFTA?
Answer eliminating tariff between members an agreement on worker rights in each country an agreement on environmental conditions in each country
elimination of restrictions on movement of labor between member countries
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Which of the following is included in the NAFTA agreement?
Answer tariff elimination on trade among Canada, Mexico, and the United States a common tariff structure adopted by Canada, Mexico, and the United States free mobility of labor and capital among Canada, Mexico, and the United States tariff elimination on trade among Canada, Mexico, and the United States, a common tariff structure adopted by Canada, Mexico, and the United States, and free mobility of labor and capital among Canada, Mexico, and the United States
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What is the “most favored nation” principle of the WTO?
Answer It means that trading partners may choose a favorite nation to trade with.
It means that any nation can refuse to trade with another that is not its most favored nation.
It means that the WTO has the right to choose the nation that has performed best within the WTO guidelines as its most favored nation.
It means that every nation must grant the same rights and treatment to other nations in the WTO as its “most favored nation.”
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The “most favored nation principle” means that:
Answer Member countries can enter into exclusive favorable agreements with some countries.
Member countries are barred from forming agreements outside their geographic vicinity.
Member countries must extend the same low tariff to all WTO member countries.
Member countries can charge differential tariff on other countries.
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Question
The WTO is considered a _________, whereas NAFTA and the European Union are __________ .
Answer free-trade area; cartels
cartel; multilateral agreements free-trade area; multilateral agreements multilateral agreement; regional trade agreements
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Multiple Choice
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Of the following, which is NOT a regional trade agreement?
Answer the World Trade Organization the European Union the North American Free Trade Agreement the Central American Free Trade Agreement
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In a large-country case, an optimal tariff would be:
Answer one that increases the producer surplus. one that raises the price of the product imported.
one in which the terms-of-trade gain exceeds the deadweight loss. one that easily passes the legislative process.
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In a large-country case, an optimal tariff is one for which the terms-of-trade gain exceeds the:
Answer producer surplus.
increased price of the product imported.
deadweight loss.
consumer surplus.
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In the large-country case, when a tariff is imposed, the country:
Answer sees a terms-of-trade gain. is able to reduce world price of the imported good.
is going to experience an increase in consumer surplus. sees a terms-of-trade gain and is able to reduce world price of the imported good.
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Multiple Choice 0 points Question
When a large nation imposes a tariff, which of the following is NOT a cost incurred?
Answer deadweight efficiency loss
reduced consumer surplus deterioration of terms of trade for the trading partners falling government revenues of the importing nation
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