(8.) Economics Hl. International Economics, Definitions.

37 Questions | Total Attempts: 88

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Economics Quizzes & Trivia

IB Economics HL. Definitions QUIZ. Section 4. International economics.


Questions and Answers
  • 1. 
    Define "free trade" using three words!
  • 2. 
    The actual number of goods and services in and out of your country is known as a country's ...
    • A. 

      Trade mass

    • B. 

      Trade volumes

    • C. 

      Terms of trade

    • D. 

      Net exports

  • 3. 
    Write down the three letters signifying a multinational corporation (that have production in at least two countries)
  • 4. 
    "(Index of export prices / Index of import prices) * 100 What is being defined?
    • A. 

      Exchange rate

    • B. 

      Trade volumes

    • C. 

      Balance of payments

    • D. 

      Terms of trade

  • 5. 
    A country has [...] in producing a good over another, if it has a lower opportunity cost of producing that good.
  • 6. 
    A country has absolute advantage in producing a good over another if it is able to produce the good using fewer [...]
  • 7. 
    "When a country imposes trade barriers to protect the incomes of domestic producers" What is specifically being defined above?
    • A. 

      Quota

    • B. 

      Embargo

    • C. 

      Subsidy

    • D. 

      Protectionism

  • 8. 
    Define "tariff" using three words!
  • 9. 
    A total ban on trade is known as a(n)
    • A. 

      Subsidy

    • B. 

      Quota

    • C. 

      Embargo

    • D. 

      Tariff

  • 10. 
    A domestic government adjusts exchange rates to obtain unfairly low prices in order to protect domestic producers. This is known as ...
    • A. 

      Voluntary export restraints

    • B. 

      Import licensing

    • C. 

      Administrative barriers

    • D. 

      Exchange controls

  • 11. 
    "A physical limit imposed on the amount of a good/service that may be imported" What is being defined?
  • 12. 
    A government may give producers a payment in order to lower prices for consumers and increase the quantity of domestic goods produced. This payment is known as a ...
  • 13. 
    "An account of a country's transactions with the rest of the world" What, specifically, is being defined?
    • A. 

      Capital account

    • B. 

      Balance of payments

    • C. 

      Current account

  • 14. 
    An area with no protectionism where goods and services move freely between borders can simply be defined as a "free trade area"
    • A. 

      True

    • B. 

      False

  • 15. 
    A free trade area where the countries lack sovereignty (there is a government body over all countries involved) is known as a(n) ...
  • 16. 
    A customs union where the four factors of production can move freely over borders is known as a(n) ...
  • 17. 
    A common market where member countries have common economic policies and either a fixed exchange rate or a common currency is known as a(n)
  • 18. 
    "When a trade agreement leads to production being switched from a low-cost producer to a high-cost producer" What is being defined?
    • A. 

      Trade creation

    • B. 

      Trade diversion

    • C. 

      Protectionism

    • D. 

      Dirty float

  • 19. 
    The opposite of trade diversion - "when a trade agreement leads to production being switched from a high-cost producer to a low-cost producer" is known as ...
  • 20. 
    A country's exchange rate is the rate at which the country's currency trades for another on the ...
  • 21. 
    When the exchange rate is determined solely by market forces (supply and demand), it is said to be ...
  • 22. 
    "Any fall in the value of a domestic currency" What is being defined?
    • A. 

      Devaluation

    • B. 

      Revaluation

    • C. 

      Depreciation

    • D. 

      Appreciation

  • 23. 
    Write down the term signifying the "guessing" of what exchange rates are going to do
  • 24. 
    "When a government buys or sells its own currency (by using gold reserves or foreign currency reserves) in order to stabilize the currency" What is this behavior called?
    • A. 

      Dirty boat

    • B. 

      Dirty float

    • C. 

      Dirty throat

    • D. 

      Kashmir goat

  • 25. 
    PPP (Purchasing power parity) is a theory that argues that the exchange rate will always adjust itself to equal ...
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