POSC 2601 international politics
Questions with 100% Correct Answers
The world economy is __________ integrated on a global scale, generating
wealth at a(n) __________ pace.
•A) decreasingly; decelerating
•B) increasingly; accelerating
•C) decreasingly; accelerating
•D) increasingly; decelerating Correct Answer: B) increasingly; accelerating
A __________ would agree that a government's most useful role is to interfere in
economics only to regulate markets in order to help them function efficiently.
That is, politics should serve the interests of economic efficiency.
•A) liberal
•B) mercantilist
•C) Marxist
•D) communist Correct Answer: A) liberal
•Liberal policy prescription: free markets and free trade
•Free economic market — a system where an "invisible hand" acts to guide the
most efficient patterns of production, exchange, and consumption.
•Free trade — the flow of goods and services across national boundaries
unimpeded by tariffs or other restrictions
,T/F: In the free market, governments set the prices of goods and services
Correct Answer: False
•Supply and demand to determine the prices of goods and services
•Equilibrium price — the best possible price for both buyers and sellers to meet
in the middle
"The creation of wealth underlies state power. Economics should serve politics" is
a statement in line with __________.
•A) economic liberalism
•B) mercantilism
•C) Marxism
•D) communism Correct Answer: B) mercantilism
•Mercantilism — trade and economic policies are manipulated to build up a
monetary surplus that could be used to finance war
•i.e. Economic transactions as a way to build military power
The sources of backlash against free trade agreements are unlikely to include
__________.
•A) human rights NGOs
•B) environmental NGOs
•C) labor unions
•D) exporting firms Correct Answer: D) exporting firms
,•Exporting firms tend to have a comparative advantage
•Comparative advantage — trade the goods states make cheaply/efficiently
for those goods and services they cannot
Applying quotas on imports is a policy that would be followed by a __________.
•A) bureaucracy
•B) conspirator
•C) free-market capitalist
•D) protectionist state Correct Answer: D) protectionist state
•Note: quotas are an example of a protectionist policy
What are two types of protectionist policies? Correct Answer: •1. Tariffs — a duty
or tax placed on certain types of imports when they enter a country
•2. Non-tariff barriers — Any other form of restricting imports besides the use of
tariffs
•Examples: Quotas, Subsidies, Other Restrictions and Regulations (examples:
labor regulations or environmental regulations)
A unilateral method of protecting domestic producers from __________ by
imposing a limit on the maximum volume of allowable imports is known as a
quota.
•A) tariffs
•B) foreign competition
, •C) subsidies
•D) predatory loans Correct Answer: B) foreign competition
•Reminder: Protectionism — states to manipulate international trade to
strengthen one or more domestic industries and shelter them from world market
Tax breaks, loans, and guaranteed high prices are examples of what type of
protectionism?
•A) tariffs
•B) quotas
•C) standards
•D) subsidies Correct Answer: D) subsidies
•Subsidies — payments by a government to a domestic industry
What are the four objectives of protectionism? Correct Answer: • 1. Cater to the
demands of important domestic industries and interests
• 2. Protect infant industries
• 3. Protect interests and industries that are vital to national security
• 4. Defend against predatory practices
Protectionism hurts an economy in which way?
• A) Consumers usually pay higher prices for products.
Questions with 100% Correct Answers
The world economy is __________ integrated on a global scale, generating
wealth at a(n) __________ pace.
•A) decreasingly; decelerating
•B) increasingly; accelerating
•C) decreasingly; accelerating
•D) increasingly; decelerating Correct Answer: B) increasingly; accelerating
A __________ would agree that a government's most useful role is to interfere in
economics only to regulate markets in order to help them function efficiently.
That is, politics should serve the interests of economic efficiency.
•A) liberal
•B) mercantilist
•C) Marxist
•D) communist Correct Answer: A) liberal
•Liberal policy prescription: free markets and free trade
•Free economic market — a system where an "invisible hand" acts to guide the
most efficient patterns of production, exchange, and consumption.
•Free trade — the flow of goods and services across national boundaries
unimpeded by tariffs or other restrictions
,T/F: In the free market, governments set the prices of goods and services
Correct Answer: False
•Supply and demand to determine the prices of goods and services
•Equilibrium price — the best possible price for both buyers and sellers to meet
in the middle
"The creation of wealth underlies state power. Economics should serve politics" is
a statement in line with __________.
•A) economic liberalism
•B) mercantilism
•C) Marxism
•D) communism Correct Answer: B) mercantilism
•Mercantilism — trade and economic policies are manipulated to build up a
monetary surplus that could be used to finance war
•i.e. Economic transactions as a way to build military power
The sources of backlash against free trade agreements are unlikely to include
__________.
•A) human rights NGOs
•B) environmental NGOs
•C) labor unions
•D) exporting firms Correct Answer: D) exporting firms
,•Exporting firms tend to have a comparative advantage
•Comparative advantage — trade the goods states make cheaply/efficiently
for those goods and services they cannot
Applying quotas on imports is a policy that would be followed by a __________.
•A) bureaucracy
•B) conspirator
•C) free-market capitalist
•D) protectionist state Correct Answer: D) protectionist state
•Note: quotas are an example of a protectionist policy
What are two types of protectionist policies? Correct Answer: •1. Tariffs — a duty
or tax placed on certain types of imports when they enter a country
•2. Non-tariff barriers — Any other form of restricting imports besides the use of
tariffs
•Examples: Quotas, Subsidies, Other Restrictions and Regulations (examples:
labor regulations or environmental regulations)
A unilateral method of protecting domestic producers from __________ by
imposing a limit on the maximum volume of allowable imports is known as a
quota.
•A) tariffs
•B) foreign competition
, •C) subsidies
•D) predatory loans Correct Answer: B) foreign competition
•Reminder: Protectionism — states to manipulate international trade to
strengthen one or more domestic industries and shelter them from world market
Tax breaks, loans, and guaranteed high prices are examples of what type of
protectionism?
•A) tariffs
•B) quotas
•C) standards
•D) subsidies Correct Answer: D) subsidies
•Subsidies — payments by a government to a domestic industry
What are the four objectives of protectionism? Correct Answer: • 1. Cater to the
demands of important domestic industries and interests
• 2. Protect infant industries
• 3. Protect interests and industries that are vital to national security
• 4. Defend against predatory practices
Protectionism hurts an economy in which way?
• A) Consumers usually pay higher prices for products.
