Int 3 HW Questions
Which event contributed to the decline in the economic power of China and India in the 1800s?
British Imperialism
Which of the following examples is best described by the economic phenomenon referred to as The Dutch Disease? 1.The discovery of a diamond mine in Myanmar increases the level of corruption and slows economic growth. 2.The discovery of a diamond mind in Myanmar results in a worsening of the terms of trade for the country when the world price of diamonds falls. 3.Exports from a newly discovered diamond mine in Myanmar result in the depreciation of its currency, the kyat, and an expansion of its other export industries. 4.Exports from a newly discovered diamond mine in Myanmar result in the appreciation of its currency, the kyat, and a contraction of its other export industries.
4
Which of the following is an example of foreign direct investment? 1)A wealthy individual in the United States invests $20 million in a mutual fund that holds only shares of foreign companies. 2)"Professor Hawthorne of the University of London buys $8,000 worth of shares of Toyota " 3)Bank of America buys $10 million worth of bonds issued by the Greek government. 4)"Fiat, an Italian automobile company, buys a controlling interest in Chrysler, a U.S. automobile company."
4
Which of the following provided the largest source of international financial capital for developing countries in 2016? 1.Remittances from emigrants 2.Official development assistance 3.Foreign portfolio investment 4.Foreign direct investment
4
From what region of the world did the largest share of international migrants emigrate in 2017?
Asia
What region of the world is the destination of the largest number of international migrants in 2017?
Asia
Developing countries tend to have high levels of government control over the economy and weak legal systems. Together, these characteristics encourage BLANK
corruption
The Southern Common Market (MERCOSUR) is actually a BLANK
customs union
Which event in the Netherlands led to the development of the economic phenomenon referred to as The Dutch Disease
discovery of natural gas in the north sea
Rising inequality and hyperinflation are often associated with BLANK
economic populism
One deviation from the most favored nation principle that the WTO accepts is that developing countries have a right to BLANK
exchange preferences among themselves and receive preferential access to markets in industrialized countries
Although regional trading agreements violate the most favored nation principle of the World Trade Organization, exceptions are made if the proposed agreement BLANK
has an internal tariff rate of zero, and does not raise tariffs for non-participants
The primary difference between a free trade area and a customs union is that BLANK
members of a customs union adopt a common set of external trade barriers.
On April 12, 2018, Blackrock launched a Social Responsibility Investment (SRI) fund that includes the criterion that the fund will not include investments in gun-related industries. This criterion is an example of " BLANK
negative screening
he World Trade Organization was created in 1995 to BLANK
oversee global rules of government policy toward international trade.
A cartel, like OPEC, is able to raise the price of a primary product, like oil, by BLANK
restricting the availability of oil
Because goods produced within a free-trade area are entitled to be traded freely within the free-trade area, determining what goods are produced within the free-trade area is important and relies on BLANK
rules of origin
If an unfair trade complaint is filed with the WTO and a panel appointed by the WTO determines that the complaint is valid, the WTO will instruct the offending country to alter its trade policy to avoid the unfair effects that were found to exist. If the offending country fails to correct its trade policy as directed by the WTO, what can the WTO do?
the WTO can authorize the countries filing the unfair trade complaint to impose retaliatory trade policies against the offending country.
Trade blocs can attract more foreign direct investment into member countries because BLANK
the market within the trade bloc is larger than the market in any of the member countries and foreign firms often seek to establish locations on the basis of market size.
The World Bank was founded in 1944 as the International Bank for Reconstruction and Development for the purpose of financing BLANK
the reconstruction of Europe after World War II.
As a result of joining a trade bloc, Country A finds that it is purchasing relatively more expensive cars from Country B, a fellow bloc member, rather than purchasing the less expensive cars from Country C, a trading bloc outsider. This phenomenon is called BLANK
trade diversion
The price at which units within a single MNE sell goods and services to other units within the MNE is the BLANK
transfer price
Section 301 of the Trade Act of 1974 allows the U.S. president to BLANK
unilaterally use threats of retaliation to open foreign markets for U.S. trade.
"Assume that a foreign affiliate of multinational enterprise makes an accounting profit. If the profits are repatriated to the home country, under what type of system will the profits be taxed by the home country?"
worldwide
According to the World Bank income categories, what income status did Myanmar have in 2017?
Lower middle
Which of the following identifies a nondiscrimination policy among trading partners?
MFN
The goal of developing international institutions, such as the World Bank, the IMF, and the WTO, is to address which of the following sources of market inefficiency?
The public good nature of global economic stability.
Which country is currently hosting the largest number of refugees?
Turkey
What effect does a trade bloc have on scales of production?
When the markets of the various countries in the trade bloc are joined, firms within those countries are presented with larger markets than they had before the trade bloc was created, and those larger markets present opportunities for firms within the trade bloc countries to expand to take advantage of additional scale economies.
Which of the following was an observable effect of NAFTA? 1)NAFTA led to a substantial decrease in the volume of trade among the three member countries. 2)Low-cost firms in Canadian manufacturing industries were replaced by the high-cost firms. 3)Imports of clothing and textiles into the member countries were diverted away from low-cost suppliers in Asia. 4)There was a massive shift of jobs toward Mexico.
3
Targeted industrial policies are often credited for the export success of high performing economies in East Asia. Which of the following policies are also credited with supporting export success in these economies? 1.High savings and investment rates 2.Economic support from the United States 3.High levels of education 4.All of the above
4
Which of the following characterized the Doha Round of international trade negotiations? 1)The creation of a global agreement regulating the trade of oil. 2)The creation of the World Trade Organization to replace the General Agreement on Tariffs and Trade. 3)The plan to phase out the Multi-fiber Agreement quotas. 4)The rise of developing countries as a voting bloc.
4
Which of the following events contributed to the debt crisis in Latin America in the 1980s? 1.Recession in the United States in the late 1970s and early 1980s. 2.Increased revenues for oil price shocks in the 1970s. 3.High tariffs in Latin American countries in the 1960s and 1970s. 4.All of the above.
4
"In the long run, what is the expected impact of an inflow of a factor of production on a national economy?" 1."An inflow of labor will expand the production possibilities frontier (PPF), while an inflow of capital will contract the PPF." 2."An inflow of labor will contract the PPF, while an inflow of capital will expand the PPF." 3.An inflow of labor or capital will expand the PPF. 4.An inflow of labor or capital will contract the PPF.
3
Tesla is a U.S. company that manufacturers electric cars. Which of the following is an example of a horizontal foreign direct investment for Tesla? 1.Tesla buys a controlling interest in a battery production plant in Mexico. 2.Tesla builds a new battery production facility in Mexico. 3.Tesla builds a new electric car production facility in Mexico. 4.Tesla puts $10 million from its pension fund into a mutual fund containing shares of foreign companies.
3
Which of the following arguments for trade protection is most commonly associated with import substituting industrialization? 1.National security concerns 2.Unfair dumping of imported goods 3.Infant industry protection I4.ntellectual property protection
3
Which of the following describes the goal of most vertical foreign direct investment? 1.Avoidance of high transportation costs 2.Avoidance of high trade barriers 3.Access to low production costs 4.Access to better terms of trade
3
Which of the following statements about a trade bloc is accurate? 1)The gains from a trade bloc are shared equally by each member. 2)Increased competition within a trade bloc can result in higher commodity prices in the domestic markets of the member countries. 3)A trade bloc may lower firms' costs by allowing them to exploit economies of scale. 4)A trade bloc can increase the opportunities for domestic business investments but usually repels foreign direct investments into the member countries.
3
Which of the following statements best describes economic populism? 1.Economic populism encourages tighter fiscal policy to reduce national debt. 2.Economic populism encourages participation in global markets to promote economic growth. 3.Economic populism encourages short-term economic growth at the expense of long-term economic growth and stability. 4.Economic populism focuses on controlling inflation to protect consumers.
3
"Suppose there are two countries in the world: Florin and Guilder. Florin has a worldwide tax system, with a tax rate of 30% on corporate profits and a credit for taxes paid in other countries. Guilder has a territorial tax system with a tax rate of 20% on corporate profits. A Florin corporation opens a subsidiary in Guilder, which makes $10,000/year in profit and pays $2000/year in taxes to the Guilder government. If the subsidiary repatriates $10,000 in profits to the parent corporation in Florin, how much tax with the parent company owe in Florin?" 1."The profits would be taxed $3000 minus the $2000 in credit for taxes paid in Guilder, for a total of $1000 in tax owed to Florin. " 2.The profits would be taxed $3000 by Florin. 3.The profits would not be taxed because they were made by a foreign subsidiary.
1
Which of the following could erode the pricing power of OPEC? 1.The discovery of new oil reserves in Scotland. 2.The discovery of new oil reserves in Venezuela. 3.The discovery of new oil reserves in Kuwait. 4.An oil spill in the Gulf Coast that depletes US supply of oil.
1
Which of the following events might provide evidence to support the Singer-Prebish Thesis? 1.The invention of polyester 2.The declining price for computer technology. 3.The invention of the smart phone 4.The Arab Oil Embargo.
1
Which of the following policies are associated with the Washington Consensus? 1.Privatization of state-owned enterprises 2.High tariff rates 3.Loose monetary policy 4.Redistribution of income
1
Which of the following will add to the FDI stock of the host country? 1.Inflows of FDI to the host country 2.Outflows of FDI from the host country 3.Inflows of FDI to the home country 4.Repayment of loans by the host country
1
What is the average time that a person spends in the status of a refugee?
10 years
In what decade of the twentieth century was the foreign-born share of the United States population at its peak?
1910s
In what decade of the twentieth century did the largest numbers of immigrants enter the United States?
1990s
"In the short run, what is the expected impact of an inflow of a factor of production on a national economy?" 1."An inflow of labor will increase the wage rate, while an inflow of capital will decrease the wage rate." 2."An inflow of labor will decrease the wage rate, while an inflow of capital will increase the wage rate." 3.An inflow of labor or capital will increase the wage rate. 4.An inflow of labor or capital will decrease the wage rate.
2
The United Nations Conference on Trade and Development (UNCTAD) has estimated that the 2017 Tax Cut and Jobs Act in the United States... 1.may lead to an increase of $2 trillion in investment funds to the foreign affiliates of U.S. parent corporations. 2.may lead to repatriation of $2 trillion in investment funds to U.S. parent corporations from their foreign affiliates. 3.may lead to an increase in the stock of foreign direct investment from U.S. parent corporations. 4.will have no net impact of foreign direct investment from U.S. parent corporations.
2
Which of the following events might provide evidence that contradicts the Singer-Prebish Thesis? 1.The invention of polyester 2.The declining price for computer technology 3.A decline in the share of income spent on food by emerging market economies 4.The declining price of rubber
2
Which of the following policies are associated with import substituting industrialization? 1.Low tariff rates 2.High tariff rates 3.Floating exchange rates T4.ight monetary policy
2
Which of the following statements best describes the Singer-Prebish Thesis? 1.Because developing countries mainly import primary products, their terms of trade may worsen over time. 2.Because developing countries mainly export primary products, their terms of trade may worsen over time. 3.Because developing countries mainly import primary products, their currency is subject to appreciation. 4.Because developing countries mainly export primary products, their currency is subject to depreciation
2
High savings rate and low inflation is often associated with BLANK
EOI
Between 1990 and 2003, which region of the world experienced the larges decline in the share of people living on less than $2 per day?
East Asia and the Pacific
In 1990, which region of the world had the largest number of people living on less than $2 per day?
East Asia and the Pacific
What country is currently the source of the largest number of refugees?
Syria
What was the effect of the Smoot-Hawley Act?
The Smoot-Hawley Act increased tariffs on certain imports into the U.S. and contributed to the severity of the Great Depression.
Which of the following is NOT true of the Uruguay Round of the multilateral trade negotiations? 1)The Uruguay Round initiated the process of liberalizing trade in services. 2)The Uruguay Round agreements began the process of liberalizing trade in agricultural products. 3)The Uruguay Round included agreements requiring member countries to provide minimum levels of ownership protection for intellectual property. 4)The Uruguay Round narrowed down the set of NTB codes as set up by the Kennedy Round and the Tokyo Round.
The Uruguay Round narrowed down the set of NTB codes as set up by the Kennedy Round and the Tokyo Round.
If an unfair trade complaint is filed with the WTO and a panel appointed by the WTO determines that the complaint is valid, the WTO will instruct the offending country to alter its trade policy to avoid the unfair effects that were found to exist. If the offending country fails to correct its trade policy as directed by the WTO, what can the WTO do?
The WTO can authorize the countries filing the unfair trade complaint to impose retaliatory trade policies against the offending country.
