Chapter 9: Regional Economic Integration

Before the United Kingdom decided to exit the EU, how many total countries were involved by 2014?

28

True or False: The USMCA prohibits duties on music and ebooks.

true

Mercosur is a free trade pact started in 1988 by which two South American economies? (Check all that apply.)

Argentina Brazil

Which industry is most affected by stipulations of USMCA?

Automobile

In 1969, which countries created the Andean Pact that was modeled on the EU, but was not as successful in achieving regional groups objectives?

Bolivia, Chile, Colombia, Ecuador, Peru

What three countries made up NAFTA?

Canada United States Mexico

What are three forms of economic integration?

Common market Free trade area Full political union

What are two impediments to establishing economic integration? (Check all that apply.)

Costs of integration Concerns over national sovereignty

Under the Andean Pact, which two members received special concessions based on the size of these countries?

Ecuador Bolivia

What are two requirements countries must take to qualify for EU membership?

Establish stable democratic government Respect human rights

What two political factors led to the development of the European Union? (Check all that apply.)

Europe's desire to hold its own on the world's political and economic stage. The devastation of western Europe during the two world wars.

What are the four main institutions responsible for determining economic policy in the EU?

European Commission Court of Justice Council of the European Union European Parliament

Because of its economic and political influence, the _____ is considered the most significant trading bloc in Europe.

European Union

What committed EU members to adopt a common currency by January 1, 1999?

European Union European Free Trade Association

Which two groups represent major trading blocks in Europe?

European Union European Free Trade Association

One of the reasons the European Union was originally formed was because

Europeans desired a lasting peace after enduring two devastating world wars.

What is the least integrated form of economic integration?

Free trade area

What are three advantages of regional market integration that can result in cost savings to a business? (Check all that apply.)

Harmonized product standards Free movement of goods across borders Simplified tax regimes

Which three nations are a part of ASEAN? (Check all that apply.)

Indonesia Philippines Singapore

Which two political factors support the idea for economic integration of nations through trade?

It can enhance the political weight of those countries in the world. Interdependency among nations decreases the potential for violent conflict.

The trade pact developed in 1988, initially between Argentina and Brazil, is called ______.

Mercosur

Which agreement was an attempt at regional economic integration in the United States?

North American Free Trade Agreement

In the campaign to leave the EU, certain groups voted to stay and others voted to leave. What were two characteristics of those who wanted to leave?

Older Less educated

______ is considered the most successful attempt at regional economic integration.

The EU

True or false: One political reason for economic integration is the potential to minimize violent conflict between nations.

True

The Maastricht Treaty committed EU members to

adopt a common currency by January 1, 1999.

An argument against regional free trade agreements contends that the benefits have been oversold, but ______ have often been ignored.

cost

There are presently 19 trade blocs in Africa, and many of these blocs have been _____ for years.

dormant

Regional _____ integration creates agreements among countries in a specific geographic area in order to reduce and eventually remove tariff and nontariff barriers to the free flow of goods.

economic

The goal of NAFTA was to

eliminate tariffs on trade between the nations.

True or False: The political structure responsible for economic policies in the EU consists of a single office known as the Court of Justice.

false

The Association of Southeast Asian Nations was formed with the intent to foster _____.

free trade

During the campaign for leaving the EU, one of the recent claims said that leaving the EU would allow the British to take back control of _____.

immigration

There has been a(n) _____ in regional economic integration in the past two decades.

increase

The creation of a single market creates _____ costs of doing business.

lower

Based on the objectives of the Single European Act, the principle of _____ states that a product standard developed in one EC country should be accepted in another.

mutual recognition

African countries have attempted to form a continental trade agreement, but have been stymied by significant ______ turmoil.

political

Based on economic theories, free trade is viewed as a ______ as all participating nations stand to gain.

positive-sum game

The Single European Act abolished restrictions on cabotage, which is the

right of foreign truckers to pick up and deliver goods within another member state's borders.

Economic theories suggest that free trade allows countries to

specialize in producing goods and service that they are most efficient at producing.

A key impediment to economic integration is that although a majority of citizens may benefit from free trade, certain groups may lose their jobs to low-cost and low-skilled labor in other countries as was the experience of some U.S. and Canadian workers in the ______ industry following the establishment of NAFTA.

textile

Costa Rica, El Salvador, Guatemala, and other countries formed a common market in the early 1960s that was called

the Central American Common Market.

Some economists argue that regional free trade agreements will provide global benefits only if

trade creation exceeds trade diversion.

The collapse of the Central American Common Market was a result of ______.

war between Honduras and El Salvador