Chapter 7: International Economics March 11, 2024 Maven Leave a Comment Welcome to the Chapter 7: International Economics Quiz! This quiz is based on the book back questions. Name Email 1. Which of the following is not an example of foreign direct investment? a) the construction of a new auto assembly plant overseas b) the acquisition of an existing steel mill overseas c) the purchase of bonds or stock issued by a textile company overseas d) the creation of a wholly owned business firm overseas None 2. If there is an imbalance in the trade balance (more imports than exports), it can be reduced by a) decreasing customs duties b) increasing export duties c) stimulating exports d) stimulating imports None 3. Tourism and travel are classified in which of balance of payments accounts? a)merchandise trade account b) services account c)unilateral transfers account d) capital account None 4. Benefits of FDI include, theoretically a) Boost in Economic Growth b) Increase in the import and export of goods and services c) Increased employment and skill levels d) All of these None 5. Foreign direct investments not permitted in India a) Banking b) Atomic energy c) Pharmaceutical d)Insurance None 6. Components of balance of payments of a country includes a) Current account b) Official account c) Capital account d) All of above None 7. BOP includes a) visible items only b) invisible items only c) both visible and invisible items d) merchandise trade only None 8. Cyclical disequilibrium in BOP occurs because of a) Different paths of business cycle. b) The income elasticity of demand or price elasticity of demand is different. c) long-run changes in an economy d) Both (a) and (b). None 9. Favourable trade means value of exports are ……. Than that of imports. a) More b) Less c) More or Less d) Not more than None 10. In the case of BOT, a) Transactions of goods are recorded. b) Transactions of both goods and services are recorded. c) Both capital and financial accounts are included. d) All of these None 11. Exchange rates are determined in a) money market b) foreign exchange market c) stock market d) capital market None 12. Net export equals …… a) Export x Import b) Export + Import c) Export – Import d) Exports of services only None 13. Which of the following is a modern theory of international trade? a) absolute cost b) comparative cost c) Factor endowment theory d) none of these None 14. Which of the following factors influence trade? a) The stage of development of a product b) The relative price of factors of productions. c) Government. d) All of the above. None 15. International trade differs from domestic trade because of a) Trade restrictions b) Immobility of factors c) Different government policies d) All the above None 16. Exchange rate for currencies is determined by supply and demand under the system of a) Fixed exchange rate b) Flexible exchange rate c) Constant d) Government regulated None 17. In general, a primary reason why nations conduct international trade is because a) Some nations prefer to produce one thing while others produce another b) Resources are not equally distributed among all trading nations c) Trade enhances opportunities to accumulate profits d) Interest rates are not identical in all trading nations None 18. Trade between two countries is known as ………….trade a) External b) Internal c) Inter-regional d) Home None 19. Terms of Trade of a country show …………… a) Ratio of goods exported and imported b) Ratio of import duties c) Ratio of prices of exports and imports d) Both (a) and (c) None 20. Who among the following enunciated the concept of single factoral terms of trade? a) Jacob Viner b) G.S.Donens c) Taussig d) J.S.Mill None Time's up Related Posts:Chapter 8: International Economic OrganisationsChapter 1: Introduction to Micro EconomicsChapter 12: Mathematical Methods for EconomicsChapter 1: Introduction to Macro Economics
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