Net-jrf Practice Mock Test #5: International Economics

10 Questions | Total Attempts: 202

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Net-jrf Practice Mock Test #5: International Economics


Questions and Answers
  • 1. 
    A primary reason why nations conduct international trade is because:
    • A. 

      Some nations prefer to produce one thing while others produce other things

    • B. 

      Resources are not equally distributed among all trading nations

    • C. 

      Trade enhances opportunities to accumulate profits

    • D. 

      Interest rates are not identical in all trading nations

  • 2. 
    The main advantage of specialization results from:
    • A. 

      Economies of large-scale production

    • B. 

      The specializing country behaving as a monopoly

    • C. 

      Smaller production runs resulting in lower unit costs

    • D. 

      High wages paid to foreign workers

  • 3. 
    International trade in goods and services is sometimes used as a substitute for all of the following except:
    • A. 

      International movements of capital

    • B. 

      International movements of labor

    • C. 

      Domestic production of the same goods and services

    • D. 

      Domestic production of different goods and services

  • 4. 
    If a nation has an open economy, it means that the nation:
    • A. 

      Allows private ownership of capital

    • B. 

      Has flexible exchange rates

    • C. 

      Has fixed exchange rates

    • D. 

      Conducts trade with other countries

  • 5. 
    International trade forces domestic firms to become more competitive in terms of
    • A. 

      Introduction of new products

    • B. 

      Product design and quality

    • C. 

      Product price

    • D. 

      All of the above

  • 6. 
    The movement to free international trade is most likely to generate short-term unemployment in which industries?
    • A. 

      Industries in which there are neither imports nor exports

    • B. 

      Import-competing industries

    • C. 

      Industries that sell to domestic and foreign buyers

    • D. 

      Industries that sell to only foreign buyers

  • 7. 
    International trade is based on the idea that:
    • A. 

      Exports should exceed imports

    • B. 

      Imports should exceed exports

    • C. 

      Resources are more mobile internationally than are goods

    • D. 

      Resources are less mobile internationally than are goods

  • 8. 
    Arguments for free trade are sometimes disregarded by politicians because:
    • A. 

      Maximizing domestic efficiency is not considered important

    • B. 

      Maximizing consumer welfare may not be a chief priority

    • C. 

      There exist sound economic reasons for keeping one’s economy isolated from other economies

    • D. 

      Economists tend to favor highly protected domestic markets

  • 9. 
    How much physical output a worker producers in an hour’s work depends on:
    • A. 

      The worker’s motivation and skill

    • B. 

      The technology, plant, and equipment in use

    • C. 

      How easy the product is to manufacture

    • D. 

      All of the above

  • 10. 
    Increased foreign competition tends to:
    • A. 

      Intensify inflationary pressures at home

    • B. 

      Induce falling output per worker-hour for domestic workers

    • C. 

      Place constraints on the wages of domestic workers

    • D. 

      Increase profits of domestic import-competing industries

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