QUESTION In an optimal currency area, similarities in the underlying structure of economic activity make it feasible to adopt a single currency and use a single exchange rate as an instrument of macroeconomic policy. Indicate whether the statement is true or false. ANSWER TRUE According to critics, a drawback of the euro is that […]
QUESTION A major stumbling block in the creation of the Free Trade Area of the Americas is that the United States wants its southern neighbors to agree to higher manufacturing tariffs, which they are not eager to embrace. Indicate whether the statement is true or false. ANSWER FALSE A major stumbling block in the […]
QUESTION The basic objective of the Association of Southeast Asian Nations is to foster freer trade among member countries and to achieve cooperation in their industrial policies. Indicate whether the statement is true or false. ANSWER TRUE The basic objective of the Association of Southeast Asian Nations is to foster freer trade among member […]
QUESTION The stated aim of the Asia-Pacific Economic Cooperation is to increase multilateral cooperation in view of the economic rise of the Pacific nations and the growing interdependence within the region. Indicate whether the statement is true or false. ANSWER TRUE The Asia-Pacific Economic Cooperation (APEC) was founded in 1990 at the suggestion of […]
QUESTION Since the number of trade groups in the African continent is impressive, progress toward the establishment of meaningful trade blocs has been fast. Indicate whether the statement is true or false. ANSWER FALSE There are now nine trade blocs on the African continent. Many countries are members of more than one group. Although […]
QUESTION In theory, the World Trade Organization rules should ensure that a free trade agreement results in trade diversion. Indicate whether the statement is true or false. ANSWER FALSE In theory, the World Trade Organization rules should ensure that a free trade agreement does not result in trade diversion. These rules allow free trade […]
QUESTION The creation of a single market through regional economic integration offers significant opportunities because markets that were formerly protected from foreign competition are increasingly open. Indicate whether the statement is true or false. ANSWER TRUE The creation of a single market through regional economic integration offers significant opportunities because markets that were formerly […]
QUESTION With the signing of the Treaty of Rome in 1957, the European Free Trade Association was established. Indicate whether the statement is true or false. ANSWER FALSE With the signing of the Treaty of Rome in 1957, the European Community was established. The name changed again in 1993 when the European Community became […]
QUESTION An advantage of the emergence of single markets is that the lowering of barriers to trade and investment among countries has led to decreased price competition throughout the European Union. Indicate whether the statement is true or false. ANSWER FALSE Just as the emergence of single markets creates opportunities for business, it also […]
QUESTION Which of the following is a home-country policy for limiting outward FDI? A. Eliminating double taxation of foreign income B. Manipulating tax rules to encourage the firms to invest at home C. Withdrawing government-backed insurance programs provided to local investors D. Reducing interest rates earned on domestic investments E. Prohibiting organizations from entering into […]
