BUS 100 FINAL EXAM QUESTIONS & ANSWERS
(True/False) An import is a product made or grown abroad but sold domestically? -
Answers -True
(True/False) The World Trade Organization (WTO) was created to encourage
international trade. - Answers -True
(True/False) Globalization refers to the process by which countries around the world are
becoming more self-sufficient. - Answers -False
(True/False) NAFTA regulates trade between the United States, Europe, and Japan. -
Answers -False
(True/False) The primary purpose of the World Trade Organization is to impose tariffs
on imported products. - Answers -False
Which organization created the classification of countries based on per capita income?
A) the World Bank
B) the World Trade Organization
C) the International Monetary Fund
D) the European Union
E) the North American Free Trade Agreement - Answers -A
Which of the following countries is the world's third largest economy, behind that of the
United States and European Union?
A) China
B) India
C) Brazil
D) Japan
E) Russia - Answers -A
Under which of the following treaties are Canada, the United States, and Mexico
gradually eliminating tariffs and all other trade barriers?
A) the EURO Agreement
B) the Pan-American Agreement
C) the North American Free Trade Agreement
D) the General Agreement on Tariffs and Trade
E) the G-3 Free Trade Agreement - Answers -C
What organization was founded in Pacific Asia in 1967 for economic, political, social,
and cultural cooperation?
A) SEATO
B) ASEAN
C) CENTO
,D) OAS
E) WTO - Answers -B
Which of the following treaties sought to eliminate trade barriers such as tariffs and
quotas?
A) United Nations Development Assistant Plan
B) Fair Labor Standards Act
C) General Agreement on Tariffs and Trade
D) General Agreement on Trade in Services
E) European Union Stability and Growth Pact - Answers -C
What are products that are created domestically and transported for sale abroad?
A) dumped goods
B) exports
C) imports
D) buy backs
E) domestic goods - Answers -B
What are products that are created abroad and then transported and sold domestically?
A) dumped goods
B) exports
C) imports
D) buy backs
E) domestic goods - Answers -C
(True/False) If the United States exports more to the Netherlands than it imports from
the Netherlands, the United States has a trade deficit with the Netherlands. - Answers -
False
(True/False) The United States has large trade deficits with Japan, China, and Mexico;
this means that the United States has imported more from them than what they have
purchased from us. - Answers -True
Which of the following is the name for the economic value of all of the products that a
country exports minus the economic value of its imports?
A) balance of foreign competition
B) balance of domestic competition
C) balance of trade
D) balance of payments
E) balance of supply and demand - Answers -C
Which of the following BEST describes a positive trade balance?
A) the economic condition in which a country's exports exceed its imports
B) the economic condition in which a country's imports exceed its exports
C) the economic condition in which a country's inflow of money exceeds its outflow
D) the economic condition in which a country's outflow of money exceeds its inflow
,E) the economic condition in which a country's natural resources exceed its human
resources - Answers -A
Which of the following refers to the situation when a country's imports exceed its
exports?
A) balance of payments
B) balance of trade
C) trade deficit
D) trade surplus
E) trade advantage - Answers -C
(True/False) Transportation costs have relatively little impact on a domestic firm's
decision to go international, compared to other possible factors. - Answers -False
True/False. International firms conduct a good deal of their business abroad and may
even maintain overseas manufacturing facilities. - Answers -True
Which of the following organizations is a firm that makes products in one country and
then distributes and sells them in others?
A) importer
B) exporter
C) multinational firm
D) international firm
E) direct foreign investor - Answers -B
Which of the following buys products in foreign markets and then sells them for resale in
its home country?
A) importer
B) exporter
C) multinational firm
D) international firm
E) direct foreign investor - Answers -A
In some South American countries, it is sometimes legal to bribe other businesses and
government officials, while this practice is illegal in the United States. Which of the
following refers to this type of policy?
A) protectionism
B) business practice laws
C) free trade agreements
D) fair trade agreements
E) local content laws - Answers -B
Which of the following denotes the practice of protecting domestic business at the
expense of free market competition?
A) fair trade
B) balanced trade
, C) free trade
D) market liberalism
E) protectionism - Answers -E
Which of the following refers to the practice of selling a product abroad for less than the
cost of production?
A) exporting
B) importing
C) dumping
D) safeguarding
E) offshoring - Answers -C
True/False. Critics of protectionism charge that it drives up prices by reducing
competition. - Answers -True
Which of the following refers to associations of producers that control supply and
prices?
A) independent agencies
B) cartels
C) trade alliances
D) multinational firms
E) trade monopolies - Answers -B
Which of the following denotes a government order forbidding exportation and/or
importation of a particular product from a particular country?
A) tariff
B) embargo
C) subsidy
D) local content law
E) business practice law - Answers -B
Which of the following is a government payment to help a domestic business compete
with foreign firms?
A) revenue tariff
B) protectionist tariff
C) import buy-back
D) export rebate
E) subsidy - Answers -E
Which of the following goals is a primary purpose of tariffs on imports?
A) maintain domestic competitiveness
B) decrease exports
C) increase imports
D) subsidize domestic industry
E) promote free trade - Answers -A
(True/False) An import is a product made or grown abroad but sold domestically? -
Answers -True
(True/False) The World Trade Organization (WTO) was created to encourage
international trade. - Answers -True
(True/False) Globalization refers to the process by which countries around the world are
becoming more self-sufficient. - Answers -False
(True/False) NAFTA regulates trade between the United States, Europe, and Japan. -
Answers -False
(True/False) The primary purpose of the World Trade Organization is to impose tariffs
on imported products. - Answers -False
Which organization created the classification of countries based on per capita income?
A) the World Bank
B) the World Trade Organization
C) the International Monetary Fund
D) the European Union
E) the North American Free Trade Agreement - Answers -A
Which of the following countries is the world's third largest economy, behind that of the
United States and European Union?
A) China
B) India
C) Brazil
D) Japan
E) Russia - Answers -A
Under which of the following treaties are Canada, the United States, and Mexico
gradually eliminating tariffs and all other trade barriers?
A) the EURO Agreement
B) the Pan-American Agreement
C) the North American Free Trade Agreement
D) the General Agreement on Tariffs and Trade
E) the G-3 Free Trade Agreement - Answers -C
What organization was founded in Pacific Asia in 1967 for economic, political, social,
and cultural cooperation?
A) SEATO
B) ASEAN
C) CENTO
,D) OAS
E) WTO - Answers -B
Which of the following treaties sought to eliminate trade barriers such as tariffs and
quotas?
A) United Nations Development Assistant Plan
B) Fair Labor Standards Act
C) General Agreement on Tariffs and Trade
D) General Agreement on Trade in Services
E) European Union Stability and Growth Pact - Answers -C
What are products that are created domestically and transported for sale abroad?
A) dumped goods
B) exports
C) imports
D) buy backs
E) domestic goods - Answers -B
What are products that are created abroad and then transported and sold domestically?
A) dumped goods
B) exports
C) imports
D) buy backs
E) domestic goods - Answers -C
(True/False) If the United States exports more to the Netherlands than it imports from
the Netherlands, the United States has a trade deficit with the Netherlands. - Answers -
False
(True/False) The United States has large trade deficits with Japan, China, and Mexico;
this means that the United States has imported more from them than what they have
purchased from us. - Answers -True
Which of the following is the name for the economic value of all of the products that a
country exports minus the economic value of its imports?
A) balance of foreign competition
B) balance of domestic competition
C) balance of trade
D) balance of payments
E) balance of supply and demand - Answers -C
Which of the following BEST describes a positive trade balance?
A) the economic condition in which a country's exports exceed its imports
B) the economic condition in which a country's imports exceed its exports
C) the economic condition in which a country's inflow of money exceeds its outflow
D) the economic condition in which a country's outflow of money exceeds its inflow
,E) the economic condition in which a country's natural resources exceed its human
resources - Answers -A
Which of the following refers to the situation when a country's imports exceed its
exports?
A) balance of payments
B) balance of trade
C) trade deficit
D) trade surplus
E) trade advantage - Answers -C
(True/False) Transportation costs have relatively little impact on a domestic firm's
decision to go international, compared to other possible factors. - Answers -False
True/False. International firms conduct a good deal of their business abroad and may
even maintain overseas manufacturing facilities. - Answers -True
Which of the following organizations is a firm that makes products in one country and
then distributes and sells them in others?
A) importer
B) exporter
C) multinational firm
D) international firm
E) direct foreign investor - Answers -B
Which of the following buys products in foreign markets and then sells them for resale in
its home country?
A) importer
B) exporter
C) multinational firm
D) international firm
E) direct foreign investor - Answers -A
In some South American countries, it is sometimes legal to bribe other businesses and
government officials, while this practice is illegal in the United States. Which of the
following refers to this type of policy?
A) protectionism
B) business practice laws
C) free trade agreements
D) fair trade agreements
E) local content laws - Answers -B
Which of the following denotes the practice of protecting domestic business at the
expense of free market competition?
A) fair trade
B) balanced trade
, C) free trade
D) market liberalism
E) protectionism - Answers -E
Which of the following refers to the practice of selling a product abroad for less than the
cost of production?
A) exporting
B) importing
C) dumping
D) safeguarding
E) offshoring - Answers -C
True/False. Critics of protectionism charge that it drives up prices by reducing
competition. - Answers -True
Which of the following refers to associations of producers that control supply and
prices?
A) independent agencies
B) cartels
C) trade alliances
D) multinational firms
E) trade monopolies - Answers -B
Which of the following denotes a government order forbidding exportation and/or
importation of a particular product from a particular country?
A) tariff
B) embargo
C) subsidy
D) local content law
E) business practice law - Answers -B
Which of the following is a government payment to help a domestic business compete
with foreign firms?
A) revenue tariff
B) protectionist tariff
C) import buy-back
D) export rebate
E) subsidy - Answers -E
Which of the following goals is a primary purpose of tariffs on imports?
A) maintain domestic competitiveness
B) decrease exports
C) increase imports
D) subsidize domestic industry
E) promote free trade - Answers -A
