ECO 336 USM MIDTERM EXAM 2025
QUESTIONS AND ANSWERS
An important factor that increased international capital flows in the second half of
the nineteenth century was - ....ANSWER ...-technological innovations
The four criteria for economic integration include trade flows, capital flows, people
flows, and the similarity of prices in separate markets. - ....ANSWER ...-True
Since the end of World War II - ....ANSWER ...-world trade has grown
more rapidly than world output
Deep integration - ....ANSWER ...-requires cooperation with other national
governments or international bodies
One important difference between the international economy of today and the
economy of 100 years ago is - ....ANSWER ...-presence of international
bodies such as the IMF and World Bank
While the world was fairly integrated at the turn of the last century, most trade was
in agricultural and raw materials, whereas today manufactured consumer and
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,producer goods play a much greater role in determining exports and imports. -
....ANSWER ...-True
Labor mobility was - ....ANSWER ...-greater in 1900 than in 2010
One of the reasons we know that international labor mobility has been higher at
other times is because - ....ANSWER ...-the percent of our population that
was foreign born was higher
Capital flows between countries are smaller than in past decades in absolute terms.
- ....ANSWER ...-False
Transactions costs in international financial markets are higher today than they
were in the past. - ....ANSWER ...-False
When world capital is allowed to flow freely between countries, it is expected that
capital will flow from - ....ANSWER ...-countries with abundant savings and
capital to countries with low savings and capital
The elimination or reduction of trade barriers caused by non-trade-related
domestic policies is referred to as - ....ANSWER ...-deep integration
A key institution that did NOT directly arise from post-WWII negotiations was the
- ....ANSWER ...-WTO
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,An example of foreign direct investment is - ....ANSWER ...-building a
starbucks shop in canada
Most of what we buy and sell never makes it out of domestic markets. -
....ANSWER ...-True
Economists - ....ANSWER ...-describe reducing tariffs and quotas as shallow
integration
Countries such as the United States that have large populations tend to have -
....ANSWER ...-lower trade-to-GDP ratios
All of the following are differences in capital flows today from the past, EXCEPT
- ....ANSWER ...-problem of volatility in financial capital flows
The trade-to-GDP ratio is calculated by - ....ANSWER ...-exports plus
imports divided by GDP
Domestic agricultural subsidies intended to support the nation's farmers would not
be considered a trade barrier so they would not be disputed internationally. -
....ANSWER ...-False
Elimination of barriers to trade (tariffs and quotas) are referred to as -
....ANSWER ...-shallow integration.
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, Negotiation over domestic policies that impact international trade are referred to
as - ....ANSWER ...-deep integration.
Which of the following kinds of agreements between two or more countries would
be an example of a shallow integration measure? - ....ANSWER ...-an
agreement to unify customs forms in order to speed up cross border traffic
A relative measure of the importance of trade is - ....ANSWER ...-trade as a
percentage of GDP
Capital and labor only very recently have been free to move across international
borders. - ....ANSWER ...-False
Made in the USA or Made in China has less meaning for products that -
....ANSWER ...-are technological and involve assembling many different
types of sometimes sophisticated components
Which of the following kinds of agreements between two or more countries would
be an example of a deep integration measure? - ....ANSWER ...-an
agreement to impose the same limits on cartels and monopolies
Most economists support open trade because it increase our choices as consumers,
lowers costs for producers, increases competition and innovation, and leads to
greater diffusion of technological change. - ....ANSWER ...-True
....COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED...TRUSTED & VERIFIED 4
QUESTIONS AND ANSWERS
An important factor that increased international capital flows in the second half of
the nineteenth century was - ....ANSWER ...-technological innovations
The four criteria for economic integration include trade flows, capital flows, people
flows, and the similarity of prices in separate markets. - ....ANSWER ...-True
Since the end of World War II - ....ANSWER ...-world trade has grown
more rapidly than world output
Deep integration - ....ANSWER ...-requires cooperation with other national
governments or international bodies
One important difference between the international economy of today and the
economy of 100 years ago is - ....ANSWER ...-presence of international
bodies such as the IMF and World Bank
While the world was fairly integrated at the turn of the last century, most trade was
in agricultural and raw materials, whereas today manufactured consumer and
....COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED...TRUSTED & VERIFIED 1
,producer goods play a much greater role in determining exports and imports. -
....ANSWER ...-True
Labor mobility was - ....ANSWER ...-greater in 1900 than in 2010
One of the reasons we know that international labor mobility has been higher at
other times is because - ....ANSWER ...-the percent of our population that
was foreign born was higher
Capital flows between countries are smaller than in past decades in absolute terms.
- ....ANSWER ...-False
Transactions costs in international financial markets are higher today than they
were in the past. - ....ANSWER ...-False
When world capital is allowed to flow freely between countries, it is expected that
capital will flow from - ....ANSWER ...-countries with abundant savings and
capital to countries with low savings and capital
The elimination or reduction of trade barriers caused by non-trade-related
domestic policies is referred to as - ....ANSWER ...-deep integration
A key institution that did NOT directly arise from post-WWII negotiations was the
- ....ANSWER ...-WTO
....COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED...TRUSTED & VERIFIED 2
,An example of foreign direct investment is - ....ANSWER ...-building a
starbucks shop in canada
Most of what we buy and sell never makes it out of domestic markets. -
....ANSWER ...-True
Economists - ....ANSWER ...-describe reducing tariffs and quotas as shallow
integration
Countries such as the United States that have large populations tend to have -
....ANSWER ...-lower trade-to-GDP ratios
All of the following are differences in capital flows today from the past, EXCEPT
- ....ANSWER ...-problem of volatility in financial capital flows
The trade-to-GDP ratio is calculated by - ....ANSWER ...-exports plus
imports divided by GDP
Domestic agricultural subsidies intended to support the nation's farmers would not
be considered a trade barrier so they would not be disputed internationally. -
....ANSWER ...-False
Elimination of barriers to trade (tariffs and quotas) are referred to as -
....ANSWER ...-shallow integration.
....COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED...TRUSTED & VERIFIED 3
, Negotiation over domestic policies that impact international trade are referred to
as - ....ANSWER ...-deep integration.
Which of the following kinds of agreements between two or more countries would
be an example of a shallow integration measure? - ....ANSWER ...-an
agreement to unify customs forms in order to speed up cross border traffic
A relative measure of the importance of trade is - ....ANSWER ...-trade as a
percentage of GDP
Capital and labor only very recently have been free to move across international
borders. - ....ANSWER ...-False
Made in the USA or Made in China has less meaning for products that -
....ANSWER ...-are technological and involve assembling many different
types of sometimes sophisticated components
Which of the following kinds of agreements between two or more countries would
be an example of a deep integration measure? - ....ANSWER ...-an
agreement to impose the same limits on cartels and monopolies
Most economists support open trade because it increase our choices as consumers,
lowers costs for producers, increases competition and innovation, and leads to
greater diffusion of technological change. - ....ANSWER ...-True
....COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED...TRUSTED & VERIFIED 4
