Question 1

One of the reasons why protectionist pressures arose around the world during the 1980s was:

Accepted Answer

A)  the different ways many countries found to get around GATT regulations.
B)  the opening up of national markets to cheap products from China.
C)  the fall of the Soviet Union.
D)  the persistent trade lead taken by the United States.
E)  the Japanese failure in industries such as automobiles and semiconductors that strained the world trading system.F) B) and C)
G) D) and E)

Question 2

Trade barriers encourage firms to disperse their productive activities-design, production, and assembly-to foreign nations.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following is a trade policy instrument that the GATT and WTO have been most successful in limiting?

Accepted Answer

A)  Local content requirements
B)  Tariffs
C)  Subsidies
D)  Voluntary export restraints
E)  Import quotasF) B) and D)
G) A) and D)

Question 4

What is a voluntary export restraint? Why do exporting countries agree to VERs? Explain with an example.

Accepted Answer

A voluntary export restraint is a quota ...

Question 5

Which of the following is NOT a constraint on a firm's ability to disperse its productive activities to foreign countries?

Accepted Answer

A)  Tariff barriers raising the costs of exporting products to a country
B)  Quotas restricting the quantity of a good that can be imported into a country
C)  Local content requirements demanding a specific fraction of domestic production
D)  The increasing integration of the world economy
E)  Antidumping policies limiting the ability of a firm to use aggressive pricingF) None of the above
G) B) and D)

Question 6

Which of the following is true regarding the difference between GATT and WTO?

Accepted Answer

A)  The WTO was encouraged to extend its reach to encompass regulations governing foreign direct investment 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 binding unlike that of WTO's.
E)  WTO allows member-countries to block adoption of arbitration reports unlike GATT.F) All of the above
G) C) and E)

Question 7

Describe briefly, with examples, the use of trade policies by governments to support their foreign policy objectives.

Accepted Answer

Governments sometimes use trade policy t...

Question 8

The Smoot-Hawley Act had a damaging effect on:

Accepted Answer

A)  the balance-of-payment of the United States.
B)  cash flow in the domestic economy of the United States.
C)  prices of natural resources in the United States.
D)  employment abroad.
E)  accrued liabilities of the United States.F) A) and E)
G) A) and D)

Question 9

Which of the following indicates the difference between GATT and WTO?

Accepted Answer

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 binding unlike that of WTO's.
E)  WTO allows member-countries to block adoption of arbitration reports unlike GATT.F) A) and D)
G) A) and E)

Question 10

Which of the following is an argument against embracing strategic trade policy?

Accepted Answer

A)  It hampers the chances of a country's firms to effectively exploit the first-mover advantages.
B)  It is certain to be captured by special-interest groups within the economy, which will distort it to their own ends.
C)  It increases the prices of the products for the domestic consumers.
D)  It hampers the abilities of the domestic firms to achieve a dominant position in the global industry.
E)  It leads to a compromise in national sovereignty.F) D) and E)
G) C) and D)

Question 11

Antidumping actions seem to be concentrated in certain sectors of the economy such as basic metal industries (e.g., aluminum and steel), chemicals, plastics, and machinery and electrical equipment.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following is considered to be the ultimate objective of antidumping policies?

Accepted Answer

A)  Protecting consumers from high prices
B)  Preventing domestic firms from unloading their excess production in domestic markets
C)  Protecting domestic producers from unfair foreign competition
D)  Protecting consumers from substandard and hazardous products
E)  Preventing foreign products from entering domestic marketF) A) and B)
G) A) and C)

Question 13

Some countries argue that government intervention to protect certain domestic industries can compromise national security.

Accepted Answer

A) True 
 B)False

Question 14

The United States accused Libya and Iran of supporting terrorist action and building weapons of mass destruction. The U.S. government, therefore, imposed trade sanctions against the two countries. Which of the following political arguments does this exemplify?

Accepted Answer

A)  Retaliation and trade war
B)  Furthering foreign policy objectives
C)  Strategic trade policy
D)  Corporate security
E)  Protecting infant industriesF) D) and E)
G) C) and D)

Question 15

The Palladian government required that all imported products that came from Lovaskiya be checked by Palladian customs inspectors. The inspection was done at a container freight station that was both remote and poorly staffed. This delayed the Lovaskiyan consignment from reaching the consumers in Palladia. The inspection strategy adopted by the customs officers in Palladia is an example of a(n) :

Accepted Answer

A)  antidumping policy.
B)  voluntary export restraint policy.
C)  administrative trade policy.
D)  monopolistic competition policy.
E)  tariff rent policy.F) B) and C)
G) A) and E)

Question 16

Which of the following is the most common political argument for government intervention in international trade?

Accepted Answer

A)  Decreasing the prices of products in the domestic market
B)  Promoting strategic trade policy
C)  Protecting jobs and industries from unfair foreign competition
D)  Improving efficiency of domestic labor
E)  Protecting human rightsF) B) and E)
G) A) and C)

Question 17

Which of the following has been excluded from the agenda for the Doha round of WTO talks that began in 2001?

Accepted Answer

A)  Reducing barriers to cross-border investment
B)  Phasing out subsidies to agricultural producers
C)  Limiting the use of antidumping laws
D)  Attempts to tie trade to labor standards in a country
E)  Cutting tariffs on industrial goods and servicesF) A) and E)
G) A) and C)

Question 18

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?

Accepted Answer

A)  Intellectual Property Rights Enforcement Directive (IPRE
D)  
B)  Court of Arbitration of Intellectual Property (CAIP) 
C)  Trade-Related Aspects of Intellectual Property Rights (TRIPS) 
D)  Intellectual Property Rights Enforcement and Resolution (IPER) 
E)  International Body on Intellectual Property (IBIP) F) C) and E)
G) A) and B)

Question 19

Which of the following groups would benefit the most from receiving subsidies?

Accepted Answer

A)  Governments
B)  International organizations such as the WTO
C)  Domestic producers
D)  Importers
E)  Foreign competitorsF) A) and B)
G) D) and E)

Question 20

What is the "infant industry argument"? What are its implications for the world economy? What are the criticisms of this argument?

Accepted Answer

The infant industry argument is by far t...

Exam 7: Government Policy and International Trade

The United States accused Libya and Iran of supporting terrorist action and building weapons of mass destruction. The U.S. government, therefore, imposed trade sanctions against the two countries. Which of the following political arguments does this exemplify?

Correct Answer
verified

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?

Correct Answer
verified

Antidumping actions seem to be concentrated in certain sectors of the economy such as basic metal industries (e.g., aluminum and steel), chemicals, plastics, and machinery and electrical equipment.

Correct Answer
verified

Describe briefly, with examples, the use of trade policies by governments to support their foreign policy objectives.

Correct Answer
verified
Governments sometimes use trade policy t...
View Answer

One of the reasons why protectionist pressures arose around the world during the 1980s was:

Correct Answer
verified

Some countries argue that government intervention to protect certain domestic industries can compromise national security.

Correct Answer
verified

What is the "infant industry argument"? What are its implications for the world economy? What are the criticisms of this argument?

Correct Answer
verified
The infant industry argument is by far t...
View Answer

What is a voluntary export restraint? Why do exporting countries agree to VERs? Explain with an example.

Correct Answer
verified
A voluntary export restraint is a quota ...
View Answer

Which of the following groups would benefit the most from receiving subsidies?

Correct Answer
verified

Which of the following is true regarding the difference between GATT and WTO?

Correct Answer
verified

Correct Answer
verified

The Smoot-Hawley Act had a damaging effect on:

Correct Answer
verified

Trade barriers encourage firms to disperse their productive activities-design, production, and assembly-to foreign nations.

Correct Answer
verified

Which of the following is a trade policy instrument that the GATT and WTO have been most successful in limiting?

Correct Answer
verified

Which of the following is an argument against embracing strategic trade policy?

Correct Answer
verified

Which of the following is NOT a constraint on a firm's ability to disperse its productive activities to foreign countries?

Correct Answer
verified

Which of the following indicates the difference between GATT and WTO?

Correct Answer
verified

Which of the following is considered to be the ultimate objective of antidumping policies?

Correct Answer
verified

Which of the following has been excluded from the agenda for the Doha round of WTO talks that began in 2001?

Correct Answer
verified

Which of the following is the most common political argument for government intervention in international trade?

Correct Answer
verified

Exam 7: Government Policy and International Trade

The United States accused Libya and Iran of supporting terrorist action and building weapons of mass destruction. The U.S. government, therefore, imposed trade sanctions against the two countries. Which of the following political arguments does this exemplify?

Correct AnswerverifiedShow Answer

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?

Correct AnswerverifiedShow Answer

Antidumping actions seem to be concentrated in certain sectors of the economy such as basic metal industries (e.g., aluminum and steel), chemicals, plastics, and machinery and electrical equipment.

Correct AnswerverifiedShow Answer

Describe briefly, with examples, the use of trade policies by governments to support their foreign policy objectives.

Correct AnswerverifiedGovernments sometimes use trade policy t...View AnswerShow Answer

One of the reasons why protectionist pressures arose around the world during the 1980s was:

Correct AnswerverifiedShow Answer

Some countries argue that government intervention to protect certain domestic industries can compromise national security.

Correct AnswerverifiedShow Answer

What is the "infant industry argument"? What are its implications for the world economy? What are the criticisms of this argument?

Correct AnswerverifiedThe infant industry argument is by far t...View AnswerShow Answer

What is a voluntary export restraint? Why do exporting countries agree to VERs? Explain with an example.

Correct AnswerverifiedA voluntary export restraint is a quota ...View AnswerShow Answer

Which of the following groups would benefit the most from receiving subsidies?

Correct AnswerverifiedShow Answer

Which of the following is true regarding the difference between GATT and WTO?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The Smoot-Hawley Act had a damaging effect on:

Correct AnswerverifiedShow Answer

Trade barriers encourage firms to disperse their productive activities-design, production, and assembly-to foreign nations.

Correct AnswerverifiedShow Answer

Which of the following is a trade policy instrument that the GATT and WTO have been most successful in limiting?

Correct AnswerverifiedShow Answer

Which of the following is an argument against embracing strategic trade policy?

Correct AnswerverifiedShow Answer

Which of the following is NOT a constraint on a firm's ability to disperse its productive activities to foreign countries?

Correct AnswerverifiedShow Answer

Which of the following indicates the difference between GATT and WTO?

Correct AnswerverifiedShow Answer

Which of the following is considered to be the ultimate objective of antidumping policies?

Correct AnswerverifiedShow Answer

Which of the following has been excluded from the agenda for the Doha round of WTO talks that began in 2001?

Correct AnswerverifiedShow Answer

Which of the following is the most common political argument for government intervention in international trade?

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified
Governments sometimes use trade policy t...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The infant industry argument is by far t...
View Answer

Correct Answer
verified
A voluntary export restraint is a quota ...
View Answer

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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