Globalisation and Economic Integration
19 questions· page 1 of 2
The diagram shows the effect of trade creation if a tariff is removed.
Which areas show the total net gain to the domestic economy?
Options
A v, w, x and y
B v, w and x only
C w and x only
D w and y only
Countries X and Y form a customs union which leads to a removal of tariffs between the countries.
The diagram shows the effect on the market for wheat in country X.
How much wheat is imported into country X from country Y before and after the customs union?
Options
| before customs union | after customs union | |
|---|---|---|
| A | KL | MN |
| B | KL | KN |
| C | LM | MN |
| D | LM | KN |
The diagram shows the effect of trade creation if a tariff is removed.
Which areas show the total net gain to the domestic economy?
Options
A v, w, x and y
B v, w and x only
C w and x only
D w and y only
What occurs in a monetary union?
Options
A Countries have the same currency.
B Countries use the same fiscal policy.
C Countries have the same domestic rates of sales tax.
D The government budget in each country is balanced.
What is not a likely feature of a customs union?
Options
A common external tariffs with non-member nations
B elimination of tariffs between member nations
C elimination of quotas between member nations
D shared common currency among member nations
What is not a threat to globalisation?
Options
A rising fear of losing jobs to immigrant workers
B rising political tensions among major economies of the world
C stronger trade unions in industries producing substitutes of imports
D withdrawal of government support for inefficient industries
What is not a threat to globalisation?
Options
A rising fear of losing jobs to immigrant workers
B rising political tensions among major economies of the world
C stronger trade unions in industries producing substitutes of imports
D withdrawal of government support for inefficient industries
Globalisation means that goods and services, capital and labour are traded on a worldwide basis.
Which combination illustrates that each trade partner can benefit when a low-income country trades with a high-income country?
Options
| the low-income country | the high-income country | |
|---|---|---|
| A | contracts are not always fulfilled due to corrupt practices | agrees to increase investment in the infrastructure of low-income countries |
| B | experiences liquidity problems that restrict investment | transfers short-term government loans repayable at high interest rates |
| C | multinational companies repatriate profits from mining of rare minerals for export | receives supplies at high prices from multinationals to meet excess demands for rare metals |
| D | supplies seasonal labour to overcome shortages for picking fruit crops | repatriates wages to families of seasonal workers |
What is a likely result of globalisation?
Options
A Absolute advantage replaces comparative advantage as the basis for trade.
B Firms’ supply chains are shortened.
C Trade is less likely to suffer from international economic shocks.
D There are higher standards of living.
What has not accompanied global economic growth over the last 25 years?
Options
A a depletion of non-renewable resources
B decreased international trade
C growing urbanisation
D increased atmospheric pollution