WGU C211 GLOBAL ECONOMICS EXAM
2026/2027 | Questions and Answers |
Global Economics .
1. Which of the following best defines globalization?
A. The process of a company expanding its operations domestically.
B. The increasing interconnectedness and interdependence of national
economies.
C. The implementation of protectionist trade policies.
D. The isolation of a country's economy from global markets.
B. The increasing interconnectedness and interdependence of national
economies.
Globalization refers to the growing integration and interdependence of
countries worldwide through the increasing volume and variety of cross-border
transactions in goods, services, and capital, as well as through the rapid and
widespread diffusion of technology.
2. What is the primary function of the World Trade Organization (WTO)?
A. To provide loans to developing countries for infrastructure projects.
B. To regulate international monetary exchange rates.
C. To oversee and liberalize international trade rules.
D. To enforce environmental regulations globally.
C. To oversee and liberalize international trade rules.
The WTO is the only global international organization dealing with the rules of
trade between nations. Its main function is to ensure that trade flows as smoothly,
predictably, and freely as possible.
,3. The term "globalization of markets" refers to:
A. The convergence of consumer tastes and preferences across different countries.
B. The increase in tariffs on imported goods.
C. The standardization of a single global currency.
D. The decline of international trade.
A. The convergence of consumer tastes and preferences across different
countries.
The globalization of markets refers to the merging of historically distinct and
separate national markets into one huge global marketplace. In many markets, the
tastes and preferences of consumers in different nations are converging.
4. Which of the following is a key driver of globalization?
A. Increased tariffs and trade barriers.
B. Technological advancements in communication and transportation.
C. A decline in foreign direct investment.
D. The rise of isolated economic policies.
B. Technological advancements in communication and transportation.
Technological change, particularly in communications, information processing,
and transportation, has been a major driver of globalization by reducing the costs
of moving goods, services, and information across borders.
5. What is Gross Domestic Product (GDP)?
A. The total value of goods and services produced by a country's citizens,
regardless of location.
B. The total value of all final goods and services produced within a country's
borders in a given period.
C. The total income earned by a country's citizens from abroad.
D. The total value of a country's exports minus its imports.
, B. The total value of all final goods and services produced within a country's
borders in a given period.
GDP is the standard measure of the value added created through the
production of goods and services in a country during a certain period. It is
measured within a country's geographic borders.
6. Which of the following best describes Foreign Direct Investment (FDI)?
A. Investment in a foreign country's stock market.
B. A company's investment in physical assets and business operations in a foreign
country.
C. Short-term loans to foreign governments.
D. The purchase of foreign currency.
B. A company's investment in physical assets and business operations in a
foreign country.
FDI occurs when a firm invests directly in new facilities to produce and/or
market a product in a foreign country. It involves a lasting interest and control in a
foreign enterprise.
7. The theory of comparative advantage, developed by David Ricardo, suggests
that countries should:
A. Produce all goods domestically to be self-sufficient.
B. Specialize in producing goods where they have the lowest opportunity cost.
C. Impose tariffs to protect domestic industries.
D. Only trade with countries that have similar economic systems.
B. Specialize in producing goods where they have the lowest opportunity
cost.
The theory of comparative advantage states that a country should specialize in
producing and exporting those goods and services that it can produce at a lower
, opportunity cost than other countries, and import goods it produces at a higher
opportunity cost.
8. What is a tariff?
A. A quota on the quantity of imports.
B. A tax imposed on imported goods.
C. A subsidy for domestic producers.
D. A restriction on foreign investment.
B. A tax imposed on imported goods.
A tariff is a tax levied by a government on imported goods and services. It is a
form of protectionism used to make imported goods more expensive and less
competitive compared to domestic products.
9. Which of the following is a non-tariff barrier to trade?
A. An import tariff.
B. An export subsidy.
C. Import quotas.
D. A value-added tax.
C. Import quotas.
Non-tariff barriers are trade restrictions that do not take the form of a tax.
Import quotas, which limit the quantity of a good that can be imported, are a
classic example.
10. The balance of payments is a record of:
A. A country's government budget deficit.
B. All economic transactions between a country's residents and the rest of the
world.
C. The total amount of currency in circulation.
D. A country's national debt.
2026/2027 | Questions and Answers |
Global Economics .
1. Which of the following best defines globalization?
A. The process of a company expanding its operations domestically.
B. The increasing interconnectedness and interdependence of national
economies.
C. The implementation of protectionist trade policies.
D. The isolation of a country's economy from global markets.
B. The increasing interconnectedness and interdependence of national
economies.
Globalization refers to the growing integration and interdependence of
countries worldwide through the increasing volume and variety of cross-border
transactions in goods, services, and capital, as well as through the rapid and
widespread diffusion of technology.
2. What is the primary function of the World Trade Organization (WTO)?
A. To provide loans to developing countries for infrastructure projects.
B. To regulate international monetary exchange rates.
C. To oversee and liberalize international trade rules.
D. To enforce environmental regulations globally.
C. To oversee and liberalize international trade rules.
The WTO is the only global international organization dealing with the rules of
trade between nations. Its main function is to ensure that trade flows as smoothly,
predictably, and freely as possible.
,3. The term "globalization of markets" refers to:
A. The convergence of consumer tastes and preferences across different countries.
B. The increase in tariffs on imported goods.
C. The standardization of a single global currency.
D. The decline of international trade.
A. The convergence of consumer tastes and preferences across different
countries.
The globalization of markets refers to the merging of historically distinct and
separate national markets into one huge global marketplace. In many markets, the
tastes and preferences of consumers in different nations are converging.
4. Which of the following is a key driver of globalization?
A. Increased tariffs and trade barriers.
B. Technological advancements in communication and transportation.
C. A decline in foreign direct investment.
D. The rise of isolated economic policies.
B. Technological advancements in communication and transportation.
Technological change, particularly in communications, information processing,
and transportation, has been a major driver of globalization by reducing the costs
of moving goods, services, and information across borders.
5. What is Gross Domestic Product (GDP)?
A. The total value of goods and services produced by a country's citizens,
regardless of location.
B. The total value of all final goods and services produced within a country's
borders in a given period.
C. The total income earned by a country's citizens from abroad.
D. The total value of a country's exports minus its imports.
, B. The total value of all final goods and services produced within a country's
borders in a given period.
GDP is the standard measure of the value added created through the
production of goods and services in a country during a certain period. It is
measured within a country's geographic borders.
6. Which of the following best describes Foreign Direct Investment (FDI)?
A. Investment in a foreign country's stock market.
B. A company's investment in physical assets and business operations in a foreign
country.
C. Short-term loans to foreign governments.
D. The purchase of foreign currency.
B. A company's investment in physical assets and business operations in a
foreign country.
FDI occurs when a firm invests directly in new facilities to produce and/or
market a product in a foreign country. It involves a lasting interest and control in a
foreign enterprise.
7. The theory of comparative advantage, developed by David Ricardo, suggests
that countries should:
A. Produce all goods domestically to be self-sufficient.
B. Specialize in producing goods where they have the lowest opportunity cost.
C. Impose tariffs to protect domestic industries.
D. Only trade with countries that have similar economic systems.
B. Specialize in producing goods where they have the lowest opportunity
cost.
The theory of comparative advantage states that a country should specialize in
producing and exporting those goods and services that it can produce at a lower
, opportunity cost than other countries, and import goods it produces at a higher
opportunity cost.
8. What is a tariff?
A. A quota on the quantity of imports.
B. A tax imposed on imported goods.
C. A subsidy for domestic producers.
D. A restriction on foreign investment.
B. A tax imposed on imported goods.
A tariff is a tax levied by a government on imported goods and services. It is a
form of protectionism used to make imported goods more expensive and less
competitive compared to domestic products.
9. Which of the following is a non-tariff barrier to trade?
A. An import tariff.
B. An export subsidy.
C. Import quotas.
D. A value-added tax.
C. Import quotas.
Non-tariff barriers are trade restrictions that do not take the form of a tax.
Import quotas, which limit the quantity of a good that can be imported, are a
classic example.
10. The balance of payments is a record of:
A. A country's government budget deficit.
B. All economic transactions between a country's residents and the rest of the
world.
C. The total amount of currency in circulation.
D. A country's national debt.
