PPSC Economics Topic 5 MCQS Test Preparation

Candidates who have done their higher education in the Economics subject and are looking to start their career through PPSC, here we come with the best preparation solution for them. We come with the online PPSC economics tests. These tests are designed by professionals who are familiar with the idea that how examiners arrange the paper for PPSC. Candidates can get a full book test as well as the Topic-wise tests. However, here on this page, the PPSC economics online test of Topic 5th is available.

MCQ's Test For PPSC Economics Topic 5 International Economics

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PPSC Economics Topic 5 International Economics

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Question # 1

A main advantage of specialization results from

Question # 2

The Hecksher Ohlin theory explains comparative advantage as the result of difference in countries.

Question # 3

Mercantilism.

Question # 4

the_____________ analysis considers the ability of domestic and foreign prices to adjust to devaluation in the short run.

Question # 5

Small nations with more than one major trading partner lend to peg the value of their currencies to.

Question # 6

In the calculation of gross domestic product net exports are.

Question # 7

Direct investment and security purchases are classified as.

Question # 8

Which exchange rate mechanism calls for frequent redefining of the par value by small amounts to remove payments disequilibrium.

Question # 9

Similar to import tariffs import quotas tend to result in.

Question # 10

A sudden shift from import tariffs to free trade may induce short term unemployment in.

Question # 11

When the price of foreign currency the exchange is above the equilibrium level.

Question # 12

The difference between bid rates and ask rates is called the

Question # 13

The NAFTA is a

Question # 14

A tariff can ___________ raise a country's welfare

Question # 15

The gain from international trade are closely related to.

Question # 16

Which exchange rate system does not require monetary reserves for official exchange rate intervention.

Question # 17

A current account surplus implies that

Question # 18

In today world most countries impose tariffs

Question # 19

International trade is based on the idea that

Question # 20

When all of the debit or credit items in the balance of payments are combined

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PPSC Economics Chapter 5 Important MCQ's

Sr.# Question Answer
1 The difference between bid rates and ask rates is called the
A. Profit
B. Arbitrage
C. Spread
D. Forward transaction
2 The balance of trade can only worsen if income_______ relative to absorption
A. Increases
B. Decreases
C. Does not change
D. None of the above
3 Comparative advantage is determined by
A. Actual difference in labor productivity between countries.
B. Relative difference in labor productivity between countries.
C. Both a and b
D. Neither a nor b
4 If a country has a linear production possibilities frontier then production is said to be subject to.
A. Constant opportunity costs
B. Decreasing opportunity costs
C. First increasing and then decreasing opportunity costs
D. Increasing opportunity costs
5 The term of trade is given by theprices.
A. Paid to all goods exported by the home country
B. Received for all goods exported by the home country
C. Received for exports and paid for imports.
D. Of primary products as opposed to manufactured products.
6 __________ is a said to exist when the formation of a regional trading group leads to the reduction of trade with nonmember countries infavor of member countries.
A. Trade creation
B. Trade diversion
C. Trade exclusion
D. Trade distortion
7 The least common type of transaction in the foreign exchanges is a.
A. Forward transaction
B. Spot transaction
C. Swap transaction
D. None of the above
8 Which exchange rate mechanism calls for frequent redefining of the par value by small amounts to remove payments disequilibrium.
A. Dual exchange rates
B. Adjustable pegged exchange rates
C. Managed floating exchange rates
D. Crawling pegged exchange rates.
9 The organization that currently establishes rules of conduct for firms engaging in international trade is the.
A. World Bank
B. International Trade commission
C. Department of Justice
D. World Trade Organization
10 A _________ is a regional trading block in which member countries eliminate intercanal trade barriers but maintain existing barriers against countries that are not members.
A. Free trade area
B. Customs union
C. Common market
D. Monetary union

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