POL 203 Final Exam Study Guide
Questions with Complete Solutions
The value of a state's exports relative to its imports. -
Correct Answers ✅Balance of Trade
The flow of goods and services across national boundaries
unimpeded by tariffs or other restrictions; in principle, free
trade was a key aspect of Britain's policy after 1846 and of
U.S policy after 1945. - Correct Answers ✅Free Trade
A body of policies that emphasize domestic control of the
economy, labor, and capital formation, even if this requires
the imposition of tariffs and other restrictions on the
movement of labor, goods and capital. - Correct Answers
✅Economic Nationalism
An economic theory and a political ideology opposed to free
trade; it shares with realism the belief that each state must
protect its own interests without seeking mutual gains
through international organizations. - Correct Answers
✅Mercantalism
The principle that says states should specialize in trading
goods that they produce with the greatest relative efficiency
and at the lowest relative cost (relative, that is, to other
goods produced by the same state). - Correct Answers
✅Comparative Advantage
,POL 203 Final Exam Study Guide
Questions with Complete Solutions
Refers to the ability of a party (an individual, or firm, or
country) to produce more of a good or service than
competitors, using the same amount of resources. - Correct
Answers ✅Absolute Advantage
A monopoly exists when a specific person or enterprises the
only supplier of a particular commodity (this contrasts with a
monopsony which relates to a single entity's control of a
market to purchase a good or service, and with oligopoly
which consists of a few entities dominating an industry).
Monopolies are thus characterized by a lack of economic
competition to produce the good or service and a lack of
viable substitute goods. - Correct Answers ✅Monopoly
A market form in which a market or industry is dominated by
a small number of sellers. - Correct Answers ✅Oligopoly
An association of producers or consumers (or both) of a
certain product, formed for the purpose of manipulating its
price on the world market. - Correct Answers ✅Cartel
A policy of self-reliance, avoiding or minimizing trade and
trying to produce everything one needs by oneself. - Correct
Answers ✅Autarchy
, POL 203 Final Exam Study Guide
Questions with Complete Solutions
The strategies by which a government works actively with
industries to promote their growth and tailor trade policy to
their needs. - Correct Answers ✅Industrial Policy
A positive balance is known as a trade surplus if it consists of
exporting more than is imported. - Correct Answers ✅Trade
Surplus
The sale of products in foreign markets at prices below the
minimum level necessary to make a profit. - Correct
Answers ✅Dumping
A duty or tax levied on certain types of imports (usually a
percentage of their value) as they enter a country. - Correct
Answers ✅Tariff
Forms of restricting imports other than tariffs, such as quotas
(ceilings on how many goods of a certain kind can be
imported). - Correct Answers ✅Non-Tariff Barriers
A restriction on imports - Correct Answers ✅Quota
A subsidy is a form of financial or in kind support extended to
an economic sector (or institution, business, or individual)
generally with the aim of promoting economic and social
policy. - Correct Answers ✅Subsidy
Questions with Complete Solutions
The value of a state's exports relative to its imports. -
Correct Answers ✅Balance of Trade
The flow of goods and services across national boundaries
unimpeded by tariffs or other restrictions; in principle, free
trade was a key aspect of Britain's policy after 1846 and of
U.S policy after 1945. - Correct Answers ✅Free Trade
A body of policies that emphasize domestic control of the
economy, labor, and capital formation, even if this requires
the imposition of tariffs and other restrictions on the
movement of labor, goods and capital. - Correct Answers
✅Economic Nationalism
An economic theory and a political ideology opposed to free
trade; it shares with realism the belief that each state must
protect its own interests without seeking mutual gains
through international organizations. - Correct Answers
✅Mercantalism
The principle that says states should specialize in trading
goods that they produce with the greatest relative efficiency
and at the lowest relative cost (relative, that is, to other
goods produced by the same state). - Correct Answers
✅Comparative Advantage
,POL 203 Final Exam Study Guide
Questions with Complete Solutions
Refers to the ability of a party (an individual, or firm, or
country) to produce more of a good or service than
competitors, using the same amount of resources. - Correct
Answers ✅Absolute Advantage
A monopoly exists when a specific person or enterprises the
only supplier of a particular commodity (this contrasts with a
monopsony which relates to a single entity's control of a
market to purchase a good or service, and with oligopoly
which consists of a few entities dominating an industry).
Monopolies are thus characterized by a lack of economic
competition to produce the good or service and a lack of
viable substitute goods. - Correct Answers ✅Monopoly
A market form in which a market or industry is dominated by
a small number of sellers. - Correct Answers ✅Oligopoly
An association of producers or consumers (or both) of a
certain product, formed for the purpose of manipulating its
price on the world market. - Correct Answers ✅Cartel
A policy of self-reliance, avoiding or minimizing trade and
trying to produce everything one needs by oneself. - Correct
Answers ✅Autarchy
, POL 203 Final Exam Study Guide
Questions with Complete Solutions
The strategies by which a government works actively with
industries to promote their growth and tailor trade policy to
their needs. - Correct Answers ✅Industrial Policy
A positive balance is known as a trade surplus if it consists of
exporting more than is imported. - Correct Answers ✅Trade
Surplus
The sale of products in foreign markets at prices below the
minimum level necessary to make a profit. - Correct
Answers ✅Dumping
A duty or tax levied on certain types of imports (usually a
percentage of their value) as they enter a country. - Correct
Answers ✅Tariff
Forms of restricting imports other than tariffs, such as quotas
(ceilings on how many goods of a certain kind can be
imported). - Correct Answers ✅Non-Tariff Barriers
A restriction on imports - Correct Answers ✅Quota
A subsidy is a form of financial or in kind support extended to
an economic sector (or institution, business, or individual)
generally with the aim of promoting economic and social
policy. - Correct Answers ✅Subsidy
