International Economics 14th Edition by Robert Carbaugh

Written by Robert Carbaugh, the 14th Edition of International Economics

ISBN-10:‎1133947727 ; ISBN-13:978-1133947721

TRADE REGULATIONS AND INDUSTRIAL POLICIES – CHAPTER 6

MULTIPLE CHOICE

1. The formation of the World Commerce Group resulted from which of the following multilateral commerce negotiations:
a. Kennedy Spherical
b. Tokyo Spherical
c. Uruguay Spherical
d. Clinton Spherical

ANS: C PTS: 1 DIF: Straightforward
NAT: BPROG: Analytical Thinking TOP: World Commerce Group
KEY: BLOOM’S: Information

2. In the context of U.S. enterprise protection, the escape clause leads to:
a. Provision of short-term quotas to firms affected by import competition
b. Tariffs that counterbalance export subsidies granted to international producers
c. Tax incentives offered to minority-owned exporting businesses
d. Duties that offset business dumping by international companies

ANS: A PTS: 1 DIF: Straightforward
NAT: BPROG: Analytical Thinking
TOP: Safeguards (The Escape Clause): Emerg. Prot. for I KEY: BLOOM’S: Information

3. Adjustment assistance is commonly utilized to aid in:
a. Retraining employees displaced by imports
b. Retraining employees displaced by exports
c. Foreign companies harmed by our quotas
d. Foreign companies harmed by our tariffs

ANS: A PTS: 1 DIF: Straightforward
NAT: BPROG: Analytical Thinking
TOP: Safeguards (The Escape Clause): Emerg. Prot. for I KEY: BLOOM’S: Information

4. The Export-Import Financial institution of the United States encourages American businesses to expand globally by offering direct loans and loan guarantees to foreign buyers of American products. To American companies, this indicates a:
a. Specific subsidy
b. Ad valorem subsidy
c. Domestic subsidy
d. Export subsidy

ANS: D PTS: 1 DIF: Moderate
NAT: BPROG: Analytical Thinking TOP: Industrial Policy of the US
KEY: BLOOM’S: Comprehension

5. The Smoot-Hawley Tariff Act of 1930 is commonly linked to:
a. Declining tariffs
b. Increases in trade volume
c. Exacerbating the global depression
d. Initiatives to liberalize non-tariff trade barriers

ANS: C PTS: 1 DIF: Moderate
NAT: BPROG: Analytical Thinking TOP: US Tariff Policies Before 1930
KEY: BLOOM’S: Comprehension

6. A trade policy aimed at addressing some domestic economic issue by exporting it to foreign countries is known as a (an):
a. Foreign dumping policy
b. Trade adjustment assistance policy
c. Most-favored-nation policy
d. Beggar-thy-neighbor policy

ANS: D PTS: 1 DIF: Moderate
NAT: BPROG: Analytical Thinking TOP: Industrial Policy of the US
KEY: BLOOM’S: Information

7. Under U.S. trade policy, which provision permits the modification of a trade liberalization agreement temporarily if significant harm is caused to domestic producers due to the agreement?
a. Adjustment assistance provision
b. Escape provision
c. Most-favored-nation provision
d. Reciprocal-trade provision

ANS: B PTS: 1 DIF: Moderate
NAT: BPROG: Analytical Thinking TOP: Industrial Policy of the US
KEY: BLOOM’S: Information

8. Which policy reflects the notion that if society benefits from increased efficiency resulting from trade liberalization, some form of compensation should be provided to those temporarily harmed by import competition?
a. Countervailing duties
b. Trade adjustment assistance
c. Domestic subsidies
d. Most-favored-nation standard

ANS: B PTS: 1 DIF: Moderate
NAT: BPROG: Analytical Thinking TOP: Trade Adjustment Assistance
KEY: BLOOM’S: Information

9. The Uruguay Round of Multilateral Trade Negotiations accomplished all of the following except:
a. Placed significant emphasis on non-tariff trade barriers
b. Is estimated to yield modest gains in global output and employment
c. Achieved reductions in tariffs but not in non-tariff trade barriers
d. Abolished all trade barriers for agricultural products

ANS: C PTS: 1 DIF: Moderate
NAT: BPROG: Analytical Thinking TOP: General Agreement on Tariffs and Trade
KEY: BLOOM’S: Information

10. The General Agreement on Tariffs and Trade and its successor, the World Trade Organization, have led to:
a. Elimination of export subsidies applied to manufactured products
b. Abolition of import tariffs on manufactured products
c. Promotion of beggar-thy-neighbor policies
d. Reductions in trade barriers through multilateral negotiations

ANS: D PTS: 1 DIF: Moderate
NAT: BPROG: Analytical Thinking TOP: General Agreement on Tariffs and Trade
KEY: BLOOM’S: Information

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