QUESTION Cadmia banned imports of Mattel toys with high levels of toxic lead, manufactured in Argonia. The underlying motive for such a move could be: A. protecting domestic businesses from unfair pricing. B. protesting the pricing of toys below their costs of production. C. protecting consumers from unsafe products. D. increasing the trade surplus of […]
QUESTION Which of the following indicates the difference between GATT and WTO? A. WTO has strict time limits unlike GATT. B. WTO operates on the basis of consensus unlike GATT. C. GATT gives trading partners the right to compensation or, in the last resort, to impose (commensurate) trade sanctions unlike WTO. D. GATT’s verdict is […]
QUESTION The country of Cadmia, which is a leading producer of bauxite, had to impose trade sanctions on Cerian soda cans in order to get the government of Ceria to enforce export restraints. This imposition by Cadmian government was undertaken to protect domestic producers of soda cans. Which of the following government intervention is being […]
QUESTION The WTO’s Agreement on which of the following is an attempt to narrow the gaps in the way intellectual property rights are protected around the world and to bring them under common international rules? A. Intellectual Property Rights Enforcement Directive (IPRED) B. Court of Arbitration of Intellectual Property (CAIP) C. Trade-Related Aspects of Intellectual […]
QUESTION Which of the following is a major reason why many economists remain critical of the infant industry argument? A. It makes the domestic industry inefficient. B. It does not provide guaranteed employment for the citizens. C. It affects the standards of living and per capita income of the people. D. It promotes foreign direct […]
QUESTION One of the main reasons why many economists remain critical of the infant industry argument is its reliance on the assumption that: A. protection of manufacturing from foreign competition is harmful. B. absolute advantage cannot sustain productivity of an industry. C. foreign firms too come under the definition of infant industry when they newly […]
QUESTION Many developing countries have a potential comparative advantage in manufacturing, but new manufacturing industries cannot initially compete with well-established industries in developed countries, according to: A. economic development argument. B. comparative advantage theory. C. national security argument. D. infant industry argument. E. mixed economy theory. ANSWER D
QUESTION The act that allows Americans to sue foreign firms that use property in Cuba confiscated from them after the 1959 revolution is known as the: A. Frederick-Peterson Act. B. D’Amato-Perkins Act. C. Perkins-Dole Act. D. Helms-Burton Act. E. Godfrey-Milliken Act. ANSWER D
QUESTION According to Krugman, the ideal way for a country to respond, when the foreign competitors of its companies are already being supported by government subsidies, is probably not to engage in retaliatory action, but to: A. help establish rules that minimize the use of trade-distorting subsidies. B. adopt the strategic trade policy as a […]
QUESTION According to Krugman, which of the following best indicates the dangers of a strategic trade policy? A. Decrease in subsidies B. Decrease in protectionism C. Occurrence of a trade war D. Huge financial debts for the countries involved E. Occurrence of a global recession ANSWER C
