International Economics - The Final Quiz - Part 1

9 Questions | By Scannerdarkly | Updated: Mar 20, 2022 | Attempts: 539

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Quiz set for the course of professor Tajoli, part 1: globalization, balance of payments. May your balance of trade be always equal to zero.

Questions and Answers

1.

Which of the following country will probably have a LOW degree of openness?
- A.
  
  A middle-east oil exporter.
- B.
  
  A relatively small country with a strong specialization in state-of-the-art microchips.
- C.
  
  A rich country with high degree of productivity in different industries.
- D.
  
  A relatively small country that export high-quality agricultural product
- E.
  
  Degree of openness of these countries are not clear.
2.

Poor countries tend to have high openness.
- A.
  
  True
- B.
  
  False
3.

The exchange ratio (nominal) between the Colombian Peso and the US dollar (measured as Peso/$) in a certain year doubles its value; the average income of the Colombian inhabitants however does not show particular modifications, and so do their consumption possibilities. Given that Colombia import from US a negligible percentage of its total import, what is the effect on the Colombian GDP calculated in US dollar with the purchase power parity method?
- A.
  
  It double.
- B.
  
  It decreases.
- C.
  
  It remains constant.
- D.
  
  It increase but not double.
- E.
  
  There are not enough data to answer.
4.

The so-called total resources available in the country are formalized (referring to the classical GDP Equation) as:
- A.
  
  GDP
- B.
  
  GDP + IMP
- C.
  
  GDP - EXP
- D.
  
  GDP + (IMP - EXP)
- E.
  
  C + I + G
5.

An increase in investments by the firms of a country can be, in the short term, the cause of a trade surplus.
- A.
  
  True
- B.
  
  False
6.

Put this transaction in the right part of the balance of payment: A. Aid received from foreign country due to natural disaster. B. Income from foreign investments in production activities. C. Trade Balance. D. Outward FDI.
- A.
  
  Current account: C, D; Financial and capital: A, B.
- B.
  
  Current account: B, C; Financial and capital: A, D.
- C.
  
  Current account: C; Financial and capital: A, B, D.
- D.
  
  Current account: A, B; Financial and capital: C, D.
7.

Which of these goods must NOT be included in the computation of the Gross National Product of Ireland
- A.
  
  Beer produced by a not-listed company owned by an Ireland family that employs workers of different nationalities.
- B.
  
  Beer company owned by Ireland citizens that owns no asset in Ireland but two production facilities in India.
- C.
  
  Beer company that employs only Ireland citizens and sells only in Ireland but is owned by an US firm.
- D.
  
  The production of these three alternatives are all included in the GNP.
8.

If in a given country citizens do not own foreign firm, GNP and GDP coincide.
- A.
  
  True
- B.
  
  False
9.

Developing countries tend to have a GNP ______ the GDP, respect to the developed ones.
- A.
  
  Higher than
- B.
  
  Equal to
- C.
  
  Lower than
- D.
  
  There isn't a clear difference in GDP/GNP between developed and developing countries.