81) What legislative decision was designed to primarily deal with trade deficits, protectionism,
and the overall fairness of U.S. trading partners?
A) the Neutrality Pact of 1941
B) the Omnibus Trade and Competitiveness Act of 1988
C) the League of Nations Act of 1920
D) the Hawley-Smoot Tariff Act of 1930
E) the International Monetary Fund and Bank Act of 1945
82) What was the impetus for the Omnibus Trade and Competitiveness Act?
A) Markets in the U.S. were open to most of the world but markets in Europe and many Asian
countries were relatively closed.
B) The U.S. market was relatively closed to the rest of the world.
C) Markets in the U.S. were being driven by foreign demand.
D) The trade volume in the U.S. was declining.
E) Markets in the U.S. were trading with partners based on how they hoped they would respond
rather than how they actually operated.
83) The Foreign Corrupt Practices Act (FCPA) was specifically addressed in the ________
section of the Omnibus Trade and Competitiveness Act.
A) market access
B) export expansion
C) import relief
D) foreign exchange regulation
E) trade deficit
84) Which section of the Omnibus Trade and Competitiveness Act recognizes that foreign
penetration of U.S. markets can cause serious competitive pressure, loss of market share, and
possibly severe financial harm?
A) the market access section
B) the export expansion section
C) the import relief section
D) the foreign exchange regulation section
E) the trade deficit section
85) What is one of the four ongoing activities that support the growth of international trade?
A) Warsaw Pact
B) Kyoto Protocol
C) International Monetary Fund
D) World Summit on Sustainable Development
E) Treaty of Waitangi
86) Which statements accurately describes the General Agreement on Tariffs and Trade
(GATT)?
A) The United States, the United Kingdom, and Germany were the only signatories of the
original GATT.
B) The original agreement provided a process to increase the tariffs on trade goods.
C) GATT member nations seek to resolve their trade disputes unilaterally.
D) The GATT panels have enforcement powers apart from advisory powers.
E) It created an agency to serve as watchdog over world trade.
87) What does GATT use as the primary method to solve global trade problems?
A) GATT works with government agencies of trade members.
B) GATT uses coercion.
C) GATT uses consultation.
D) GATT implements the legislative agenda of trade members.
E) GATT creates binding agreements between member nations.
88) What agreement makes it possible to challenge the restrictions in Indonesia that prohibit
foreign firms from opening their own wholesale or retail distribution channels?
A) Trade-Related Aspects of Intellectual Property Rights (TRIPs)
B) Trade-Related Investment Measures (TRIMs)
C) General Agreement on Trade in Services (GATS)
D) Marrakesh Agreement
E) Stockholm Agreement
89) The Uruguay Round resulted in which institution becoming the successor to the GATT?
A) International Monetary Fund
B) World Bank
C) European Services Forum
D) World Trade Organization
E) Association of Southeast Asian Nations
90) How are WTO decisions enforced?
A) All WTO decisions are enforceable under law.
B) Member nations pay a duty to join WTO and this creates natural compliance.
C) The World Court reviews and enforces all WTO decisions.
D) International pressure to comply with WTO decisions is expected to force compliance.
E) Decisions must pass through both houses of Congress to be enforced.
91) __________ are becoming a popular way to circumvent WTO guidelines and impose new
duties.
A) Antidumping duties
B) Basic excise duties
C) Special excise duties
D) Production taxes
E) Manufacturing taxes
92) Several nations that have become frustrated with the slow progress of the most recent round
of WTO trade negotiations are
A) negotiating bilateral trade agreements.
B) forming a rival organization.
C) refusing to accept all the rules and regulations imposed by the WTO.
D) using legal means to sue the WTO.
E) opting out of membership in the WTO.
93) _________ and the World Bank Group are two global institutions created primarily to assist
nations in becoming and remaining economically viable.
A) Amnesty International
B) The World Court
C) The International Monetary Fund
D) The International Red Cross
E) The International Federation of Blue Cross
94) What market barriers led to the creation of the International Monetary Fund?
A) trade embargoes
B) inflation and recession in Europe
C) new taxing bodies governing trade
D) inadequate monetary reserves and unstable currencies
E) export quotas and higher tariffs
95) Developed by the International Monetary Fund to cope with universally floating exchange
rates, ________ represent an average base of value derived from the value of a group of major
currencies.
A) exchange permits
B) special drawing rights
C) floating currencies
D) gold rates
E) dollar parities
96) The special drawing rights (SDRs) developed by the IMF can be thought of as
A) black gold.
B) exchange permits.
C) floating currencies.
D) paper gold.
E) virtual dollars.
97) What is a basic criticism of global financial institutions?
A) They failed to focus on the aim of reducing inequalities between rich and poor countries.
B) They failed to help the Asian countries substantially when they underwent a major financial
crisis in the 1990s.
C) They failed to respect the autonomy of member nations by deeming any bilateral agreements
between members as illegal if made without their approval.
D) They failed to foresee and counter the unintended effects of globalization like pollution,
exploitation, and cultural extinction.
E) They failed to suppress the terrorists who were responsible for the attack in London that
coincided with the G8 summit.
98) While unintended, what is an adverse consequence of globalization?
A) nationalization of private sector holdings
B) lower and more competitive oil prices
C) reduced variety and quality of goods and services
D) worker exploitation and domestic job losses
E) provision of loans from the World Bank
99) Which statement accurately explains the status of protests against global financial
institutions?
A) Organized protests against global financial institutions have been catching the attention of the
world since the establishment of the IMF in 1945.
B) The sole focus of the anticapitalist protestors has been the environmental impact of
globalization and the need for stability.
C) The “antisweatshop” campaigns by students in America have translated into changes in
policy.
D) The entire gamut of anticapitalist protests have been weak and ineffectual in the face of the
tremendous power of global financial institutions.
E) The protests against global financial institutions have been organized yet nonviolent as a rule.
100) What steps did the United States take following World War II to minimize the spread of
communism around the world? Name at least one specific piece of legislation that was created.
101) Compare the U.S. position in world trade today to when Servan-Schreiber warned Europe
about U.S. multinational domination.
102) Why must the balance-of-payments record always be in balance? What does a balanced
record signify?
103) Compare and contrast the three accounts of a balance-of-payments statement.
104) Describe the cost to the consumer when protectionist measures are in place.
105) Name three things that can be restricted when tariffs are imposed.
106) Explain the difference between a quota and a licensing limit.
107) Describe the three areas covered by the Omnibus Trade and Competitiveness Act of 1988
that are considered critical in improving U.S. trade.
108) Describe how the General Agreement on Trade in Services (GATS) helped the United
States reduce barriers to international trade in services.
109) Why was the International Monetary Fund (IMF) formed? How does the IMF deal with
universally floating rates?