Content Options for Instructors (COI1) – The United States and the Global Economy
100. The most-favored-nation clause in U.S. trade agreements:
101. Which is a basic principle of the General Agreement on Tariffs and Trade?
Content Options for Instructors (COI1) – The United States and the Global Economy
102. Which of the following statements is correct?
103. One result from the Uruguay Round of the General Agreement on Tariffs and Trade
was:
104. One of the primary achievements of the Uruguay Round of GATT negotiations was the:
Content Options for Instructors (COI1) – The United States and the Global Economy
105. The successor to GATT created in the Uruguay Round is the:
106. What is the basic purpose of the World Trade Organization?
107. Proponents of the World Trade Organization contend that it:
Content Options for Instructors (COI1) – The United States and the Global Economy
108. A major criticism of the World Trade Organization is that it:
109. A free-trade area or zone promotes:
110. Which of the following would be the best example of economic integration to create a
free-trade zone?
Content Options for Instructors (COI1) – The United States and the Global Economy
111. What is the new common currency used by many members of the European Union?
112. What is the basic purpose of the euro?
113. The international trade bloc that liberalized the movement of capital and labor among its
members is the:
Content Options for Instructors (COI1) – The United States and the Global Economy
114. An example of economic integration in the Western hemisphere that created a free-trade
zone is the:
115. What was one of the major arguments for the North American free-trade zone?
116. The Trade Adjustment Assistance Act is focused mainly on assisting:
Content Options for Instructors (COI1) – The United States and the Global Economy
117. Fair-trade standards guarantee:
118. Globalization of resource markets has resulted in the business practice of off-shoring,
which involves:
119. International trade and global competition has forced American businesses to:
Content Options for Instructors (COI1) – The United States and the Global Economy
120. The competition that American businesses have faced in recent years from global
competition:
121. Imports and exports are examples of financial flows.
122. When a U.S. firm purchases a Hungarian metal plant, this is an example of a capital
resource flow.
Content Options for Instructors (COI1) – The United States and the Global Economy
123. In terms of combined volume of imports and exports, China was the world’s leading
trading nation in 2009.
124. A trade deficit occurs when government spending exceeds tax revenues.
125. The leading export of the United States in 2009 was agricultural products.
126. Exports and imports each accounted for less than 15% of U.S. GDP in 2009.
Content Options for Instructors (COI1) – The United States and the Global Economy
127. In terms of combined volume of exports and imports, the largest trading partner of the
United States is China.
128. The U.S. has a trade deficit in goods, but a trade surplus in services.
129. When a country has a comparative advantage in some product, it has a higher domestic
opportunity cost, but can charge a lower price for the product.
130. Nation A can produce either 6 units of steel or 12 units of wheat. Nation B can produce
either 8 units of steel or 8 units of wheat. These data suggest that Nation A has the
comparative advantage in producing wheat.
Content Options for Instructors (COI1) – The United States and the Global Economy
131. Specialization based on comparative advantage will shift a nation’s production
possibilities curve outwards.
132. Through international trade an economy can consume a combination beyond its domestic
production possibilities curve.
133. In the dollar/yen market, if the supply of yen increases other things being equal, the
dollar will appreciate.
134. If the U.S. dollar depreciates against the euro, then it will be easier for U.S. exporters to
sell their products in Europe.
Content Options for Instructors (COI1) – The United States and the Global Economy
135. Relatively high rates of U.S. inflation compared to other countries will increase the
supply of, and decrease the demand for, dollars in foreign exchange markets.
136. An appreciation of its currency would tend to worsen the trade deficit of a nation.
137. Tariffs benefit the domestic producers, but hurt the consumers.
138. Tariffs and quotas benefit American consumers because they protect the market for
domestic products.
Content Options for Instructors (COI1) – The United States and the Global Economy
139. One of the cardinal principles of the General Agreement on Tariffs and Trade was the
need for bilateral negotiations for trade disputes.
140. The basic purpose of the World Trade Organization is to monitor the amount of trade
between nations and issue a yearly report.
142. A basic purpose for the establishment of the euro was to create a common currency and
use it to improve the free flow of goods, services, and resources among the member nations in
the Euro Zone.
Content Options for Instructors (COI1) – The United States and the Global Economy
143. The North American Free Trade Agreement resulted in a massive loss of U.S. jobs.
144. With the decline of trade protection and increased global competition, some American
firms are likely to learn that they are producing goods for which America clearly has a
comparative disadvantage.