Understanding Political Economy and Globalization: Concepts from Heywood's 5th Edition

1. What is Protectionism?

Encouraging international cooperation and collaboration.

Import restrictions such as quotas and tariffs, designed to protect domestic producers.

Promoting free trade agreements between countries.

Eliminating trade barriers to increase global competition.

Protectionism refers to the use of import restrictions such as quotas and tariffs to shield domestic industries from foreign competition. It is the opposite of promoting free trade agreements, encouraging cooperation, and eliminating trade barriers in order to promote global competition.

Explanation

Protectionism refers to the use of import restrictions such as quotas and tariffs to shield domestic industries from foreign competition. It is the opposite of promoting free trade agreements, encouraging cooperation, and eliminating trade barriers in order to promote global competition.

2. What is Keynesianism?

An economic principle that emphasizes supply-side economics and tax cuts.

An economic policy focused on minimal government intervention in the marketplace.

A theory that advocates for unlimited government spending to stimulate economic growth.

Keynesianism is a theory that focuses on managing aggregate demand through government policies to achieve full employment, contrasting with the other options which do not align with the core principles of Keynesian economics.

Explanation

Keynesianism is a theory that focuses on managing aggregate demand through government policies to achieve full employment, contrasting with the other options which do not align with the core principles of Keynesian economics.

3. What is stagflation?

A situation of high unemployment accompanied by deflation.

A term used to describe a stable economy with low unemployment and inflation rates.

A period of rapid economic growth with low inflation rates.

A combination of economic stagnation, reflected in high or rising unemployment, and an increase in inflation.

Stagflation is a unique economic phenomenon that involves a rare combination of high unemployment and inflation, contrary to the typical relationship between the two factors.

Explanation

Stagflation is a unique economic phenomenon that involves a rare combination of high unemployment and inflation, contrary to the typical relationship between the two factors.

4. What is homogenization?

The transformation of a liquid into a solid state by cooling or drying.

The study of organisms living in similar environments but in different parts of the world.

The tendency for all parts or elements (in this case, countries) to become similar or identical.

The process of mixing ingredients thoroughly to create a uniform substance.

Homogenization refers to the tendency for all parts or elements to become similar or identical, hence the correct answer. The other options do not accurately define homogenization.

Explanation

Homogenization refers to the tendency for all parts or elements to become similar or identical, hence the correct answer. The other options do not accurately define homogenization.

5. What is McDonaldization?

A term used to describe the marketing strategy of McDonald's to increase sales and profits.

A term used to describe the process of turning food into fast-food meals at McDonald's restaurants.

The process of creating a fast-food chain similar to McDonald's in different countries.

McDonaldization refers to the widespread influence of global commodities and commercial practices associated with fast-food industry on various economic sectors, not just limited to McDonald's restaurants or their marketing strategies.

Explanation

McDonaldization refers to the widespread influence of global commodities and commercial practices associated with fast-food industry on various economic sectors, not just limited to McDonald's restaurants or their marketing strategies.

6. What is financialization?

A process that involves the elimination of financial systems within businesses and organizations.

The practice of increasing financial stability and reducing debt within an economy.

The act of reducing the amount of money spent on financial activities.

Financialization refers to the increasing role of financial motives, financial markets, financial actors, and financial institutions in the operation of the domestic and international economies.

Explanation

Financialization refers to the increasing role of financial motives, financial markets, financial actors, and financial institutions in the operation of the domestic and international economies.

7. What is a sovereign debt crisis?

An economic phenomenon where a country's currency strengthens significantly.

A term that refers to a country's ability to borrow money at low interest rates.

A situation where the government has an excess surplus of funds.

A sovereign debt crisis occurs when a country faces difficulties in repaying or refinancing its national debt, leading to a structural imbalance in its finances and requiring external assistance.

Explanation

A sovereign debt crisis occurs when a country faces difficulties in repaying or refinancing its national debt, leading to a structural imbalance in its finances and requiring external assistance.

8. What is the paradox of thrift?

The idea that saving money instead of spending it will always result in increased overall wealth.

An economic theory suggesting that spending more than what is earned leads to financial stability.

The belief that individual savings always positively contribute to economic growth and prosperity.

The paradox of thrift highlights the potential negative consequences of increased saving on consumption and growth, contrary to the common belief that saving is always beneficial for the economy.

Explanation

The paradox of thrift highlights the potential negative consequences of increased saving on consumption and growth, contrary to the common belief that saving is always beneficial for the economy.

9. What is mercantilism?

A form of capitalism that promotes free market and limited government intervention.

An economic theory that advocates for maximum trade with minimal government interference.

An economic system based on communal ownership of the means of production.

Mercantilism is a economic philosophy that emphasizes the importance of the state in economic matters, contrasting with communal ownership, free market capitalism, and minimal government intervention.

Explanation

Mercantilism is a economic philosophy that emphasizes the importance of the state in economic matters, contrasting with communal ownership, free market capitalism, and minimal government intervention.

10. What is indigenization?

An economic policy that promotes the growth of local businesses and industries by limiting foreign influence.

The process of removing indigenous cultures and replacing them with foreign ones.

A process through which local goods and practices are adapted to foreign needs and circumstances.

The process through which alien goods and practices are absorbed by being adapted to local needs and circumstances.

A political movement advocating for the rights of indigenous peoples.

Indigenization refers to the adaptation of alien goods and practices to local needs and circumstances, not the other provided options.

Explanation

Indigenization refers to the adaptation of alien goods and practices to local needs and circumstances, not the other provided options.