PPSC Economics Topic 5 International Economics With Answers

PPSC Economics Topic 5 International Economics

Sr. # Questions Answers Choice
1 Specific tariffs are collected as Fixed amount of money per unit traded a percentage of the price of the product A percentage of the quantity of imports All of the above
2 Ad valorem tariffs are collected as. Fixed amounts of money per unit traded A percentage of the price of the product A percentage of the quantity of imports All of the above
3 Which trade policy results in the government levying both a specific tariff and an advalorem tariff on imported goods. Compound tariff Nominals tariff Effective tariff Revenue tariff
4 A tax of 17 percent per imported item would be an example of a Ad valorem tariff Specific tariff effective tariff Compound tariff
5 A tax of 18 cents per unit of imported cheese would be an example of a. Compound tariff Effective tariff Ad valorem tariff Specific tariff
6 A product will be traded only if the pre trade price difference between the two countries Is less than the cost of transporting it between them is greater than the cost of transporting it between them Equals the cost of transporting it between them More information is needed to answer this question
7 According to the factor price equalization theorem, the ______ factor should oppose free trade policies in any given country. Abundant scarce Neither Can't tell without more information
8 The factor endowment theory was pioneered by Adam Smith David Richardo Wassily Leontief Ell Heckscher and Bartill Ohlim
9 Advocates of industrial policy maintain that government should. Purse free trade as a policy that leads to maximum global efficiency Grant subsides to firms offering potential comparative advantage. Provide loans to domestic workers in exporting industries. Increase interest rates on loans made to firms in import competing industries.
10 According to the Heckscher - Ohlin model <sup>Every one automatically gains from trade</sup> The gainers from trade out number the losers from trade The scarce factor necessary gains from trade None of the above
11 Wassily Leontief used an input output table in order to test the. Richardian theory of comparative advantage Heckscher Ohlin theory of comparative advantage. Linder theory of overlapping demand All of the above
12 If tastes are identical between countries then comparative advantage is determined by Supply conditions only Demand conditions only Supply and demand conditions Can't tell without more information.
13 Industrial policies intended to foster comparative advantage for domestic industries could result in the implementation of. Research and development subsides. Loan guarantees Low interest rate loans All of the above
14 The _____ analyzes the income distribution effects of trade in the short run when resources are immobile among industries. Stolpher Samuelson theory Factor endowment theory. Specific factor theory Over lapping demand theory
15 According the Hacksher-Ohlin model the source of comparative advantage is a country's Technology Advertising Factor endowments both a and c
16 That the division of labor is limited by the size of th market best applies to which explanation of trade. Factor endowment theory Product like cycle theory Economics of scale theory Over lapping demand theory
17 Should international transpiration costs decrease the effect on international trade would include a. Increases in the volume of trade Smaller gain from trade Decline in the income of home producers Decrease in the level of specialization in production.
18 The product cycle theory of trade is essentially a Static short run trade theory Dynamic, long run trade theory Zero sum theory of trade Negative sum theory of trade
19 The comparative advantage model of Ricardo was based on. Interindustry specialization and trade Interindustry specialization and trade Demand conditions underlying specialization and trade Income conditions underlying specialization and trade
20 According to the Hackscher - Ohlin model the source of comparative advantage is a country's Technology Advertising Factor endowments both a and c
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