INTB 200 Test 2 Question and answers
correctly solved 2026/2027
Customs Union - correct answer A group of countries committed to (1) removing all barriers to the free
flow of goods and services between each other and (2) the pursuit of a common external trade policy.
Common market - correct answer a group of countries that acts as a single market, without trade
barriers between member countries
Economic Union - correct answer A group of countries committed to (1) removing all barriers to the free
flow of goods, services, and factors of production between each other, (2) the adoption of a common
currency, (3) the harmonization of tax rates, and (4) the pursuit of a common external trade policy.
Trade Creation - correct answer occurs when low cost producers within the free trade area replace high
cost domestic producers
Trade diversion - correct answer occurs when higher cost suppliers within the free trade area replace
lower cost external suppliers
European Commission - correct answer Responsible for proposing EU legislation, implementing it, and
monitoring compliance
European council - correct answer The heads of state of EU members and the president of the European
Commission
European parliament - correct answer Elected EU body that provides consultation on issues proposed
by European Commission
Functions of the foreign market exchange - correct answer Exchange, hedging, speculation, arbitrage
correctly solved 2026/2027
Customs Union - correct answer A group of countries committed to (1) removing all barriers to the free
flow of goods and services between each other and (2) the pursuit of a common external trade policy.
Common market - correct answer a group of countries that acts as a single market, without trade
barriers between member countries
Economic Union - correct answer A group of countries committed to (1) removing all barriers to the free
flow of goods, services, and factors of production between each other, (2) the adoption of a common
currency, (3) the harmonization of tax rates, and (4) the pursuit of a common external trade policy.
Trade Creation - correct answer occurs when low cost producers within the free trade area replace high
cost domestic producers
Trade diversion - correct answer occurs when higher cost suppliers within the free trade area replace
lower cost external suppliers
European Commission - correct answer Responsible for proposing EU legislation, implementing it, and
monitoring compliance
European council - correct answer The heads of state of EU members and the president of the European
Commission
European parliament - correct answer Elected EU body that provides consultation on issues proposed
by European Commission
Functions of the foreign market exchange - correct answer Exchange, hedging, speculation, arbitrage
