EC 380 ACTUAL FINAL EXAMS ALL QUESTIONS
AND ANSWERS SURE A+
✔✔World Bank - ✔✔- created at Bretton Woods Conference (1944)
- original purpose: mechanism to rebuild Europe after WWII
- modern purpose: provide capital & technical assistance for economic development
(long term)
✔✔World Trade Organization (WTO) - ✔✔- initially GATT (Bretton Woods) & used a
trade round
- focused on proportional tariff reductions & elimination of quotas to promote free-r trade
- still in effect today:
1) national treatment
2) nondiscrimination
- all MEMBERs must adhere to rules of trade set by WTO
✔✔National Treatment (GATT) - ✔✔foreign goods must be treated the same as national
goods
, ✔✔Nondiscrimination (GATT) - ✔✔prohibits different tariffs/rules for different countries
- most favored nations status (MFN)
✔✔Uruguay Round (WTO) - ✔✔- 1995
- umbrella organization for all agreements
- extended trade agreements into services, agriculture, patent protections, international
investment, & more
✔✔Doha Round (WTO) - ✔✔- 2001 (Doha Development Agenda)
- primary focus: discussion of issues concerning developing countries
- 1st round failed, mainly due to including agriculture
✔✔Regional Trade Agreements - ✔✔Types:
1) bilateral (2 members)
2) plurilateral (several members)
3) multilateral (open to all)
They violate nondiscrimination rule
- allowed as long a trade creation (new trade created) > trade division (trade that is
diverted)
Claims:
- reduce trade barriers
- try new trade agreements
- alternative to WTO
Opponents:
- divert attention from multilateral negotiations
- rarely lead to WTO revision
- discriminate against poorer nations
✔✔Partial Agreement (RTA) - ✔✔free trade in one or a few products
✔✔Free Trade Area (RTA) - ✔✔free trade in all goods & services (outputs)
✔✔Customs Union (RTA) - ✔✔an free trade area (FTA) plus a common external tariff
✔✔Common Market (RTA) - ✔✔a customs union plus free movement of labor & capital
(inputs)
✔✔Economic Union (RTA) - ✔✔a common market plus substantial harmonization of
economic policies
AND ANSWERS SURE A+
✔✔World Bank - ✔✔- created at Bretton Woods Conference (1944)
- original purpose: mechanism to rebuild Europe after WWII
- modern purpose: provide capital & technical assistance for economic development
(long term)
✔✔World Trade Organization (WTO) - ✔✔- initially GATT (Bretton Woods) & used a
trade round
- focused on proportional tariff reductions & elimination of quotas to promote free-r trade
- still in effect today:
1) national treatment
2) nondiscrimination
- all MEMBERs must adhere to rules of trade set by WTO
✔✔National Treatment (GATT) - ✔✔foreign goods must be treated the same as national
goods
, ✔✔Nondiscrimination (GATT) - ✔✔prohibits different tariffs/rules for different countries
- most favored nations status (MFN)
✔✔Uruguay Round (WTO) - ✔✔- 1995
- umbrella organization for all agreements
- extended trade agreements into services, agriculture, patent protections, international
investment, & more
✔✔Doha Round (WTO) - ✔✔- 2001 (Doha Development Agenda)
- primary focus: discussion of issues concerning developing countries
- 1st round failed, mainly due to including agriculture
✔✔Regional Trade Agreements - ✔✔Types:
1) bilateral (2 members)
2) plurilateral (several members)
3) multilateral (open to all)
They violate nondiscrimination rule
- allowed as long a trade creation (new trade created) > trade division (trade that is
diverted)
Claims:
- reduce trade barriers
- try new trade agreements
- alternative to WTO
Opponents:
- divert attention from multilateral negotiations
- rarely lead to WTO revision
- discriminate against poorer nations
✔✔Partial Agreement (RTA) - ✔✔free trade in one or a few products
✔✔Free Trade Area (RTA) - ✔✔free trade in all goods & services (outputs)
✔✔Customs Union (RTA) - ✔✔an free trade area (FTA) plus a common external tariff
✔✔Common Market (RTA) - ✔✔a customs union plus free movement of labor & capital
(inputs)
✔✔Economic Union (RTA) - ✔✔a common market plus substantial harmonization of
economic policies
