Question 1

Which of the following is a political reason for governments to intervene in markets?

Accepted Answer

A)   To help citizens obtain jobs in foreign markets
B)   To aid their country's businesses in foreign markets
C)   To subsidize multinational companies
D)   To protect jobs and industriesE) A) and D)
F) A) and C)

Question 2

According to the Buy America Act, if a company wishes to win a contract from a U.S. government agency to provide some equipment, it must ensure that at least 51 percent of the product by value is manufactured in the United States. This is an example of:

Accepted Answer

A)   antidumping duties.
B)   voluntary export restraints.
C)   import quotas.
D)   local content requirements.E) A) and D)
F) B) and D)

Question 3

If a domestic industry lacks the capacity to meet demand, an _____ can raise prices for both the domestically produced and the imported good.

Accepted Answer

A)   import tariff
B)   import quota
C)   import subsidy
D)   ad valorem tariffE) A) and B)
F) A) and D)

Question 4

The threat of _____ limits the ability of a firm to use aggressive pricing to gain market share in a country.

Accepted Answer

A)   specific tariffs
B)   import quotas
C)   countervailing duties
D)   antidumping actionE) C) and D)
F) None of the above

Question 5

Antidumping duties are often called:

Accepted Answer

A)   special circumstance duties.
B)   positive duties.
C)   retroactive duties.
D)   countervailing duties.E) A) and D)
F) B) and D)

Question 6

During the 1980s and early 1990s, the world trading system erected by the GATT gained momentum as protectionist demands generally decreased across the world.

Accepted Answer

A) True 
 B)False

Question 7

What is dumping? How do governments respond to charges of dumping?

Accepted Answer

Dumping is defined as selling goods in a...

Question 8

Under a tariff rate quota, a higher tariff rate is applied to imports within the quota than those over the quota.

Accepted Answer

A) True 
 B)False

Question 9

According to the strategic trade policy argument:

Accepted Answer

A)   government intervention is not required because firms can borrow money from the capital markets to finance the required investments.
B)   selling goods in a foreign market at below their "fair" market value is legally and ethically justified.
C)   government support can help domestic firms overcome the first-mover advantages enjoyed by foreign competitors.
D)   a government should use subsidies to support promising firms that are active in old, established industries.E) All of the above
F) None of the above

Question 10

Tariff rates on agricultural products are generally:

Accepted Answer

A)   much lower than tariff rates on manufactured products or services.
B)   much lower than import fees on electronics.
C)   much higher than tariff rates on manufactured products or services.
D)   much higher than import fees on electronics.E) None of the above
F) All of the above

Question 11

Antidumping policies vary drastically from country to country.

Accepted Answer

A) True 
 B)False

Question 12

_____ are levied as a proportion of the value of the imported good.

Accepted Answer

A)   Specific tariffs
B)   Import quotas
C)   Ad valorem tariffs
D)   Tariff rate quotasE) B) and D)
F) None of the above

Question 13

The WTO's GATS has taken the lead to:

Accepted Answer

A)   provide enhanced protection for intellectual property.
B)   extend free trade agreements to services.
C)   reduce agricultural subsidies.
D)   enforce GATT rules.E) B) and C)
F) A) and D)

Question 14

In 1997, two South Korean manufacturers of semiconductors, LG Semicon and Hyundai Electronics, were accused of selling dynamic random access memory chips (DRAMs)  in the U.S. market at below their costs of production. It was alleged that the firms were trying to unload their excess production in the United States. This is an example of:

Accepted Answer

A)   ad valorem tariff.
B)   subsidy.
C)   dumping.
D)   import quota.E) All of the above
F) None of the above

Question 15

GATT has not recognized the infant industry argument as a legitimate reason for protectionism.

Accepted Answer

A) True 
 B)False

Question 16

The _____ specifies that government agencies must give preference to American products when putting contracts for equipment out to bid unless the foreign products have a significant price advantage.

Accepted Answer

A)   General Agreement on Tariffs and Trade
B)   Buy America Act
C)   American Reinvestment Act
D)   Smoot-Hawley ActE) A) and D)
F) All of the above

Question 17

A company that sells its product in a foreign market below the cost of production may be accused of _____.

Accepted Answer

A)   pandering
B)   profiteering
C)   carnivorous behavior
D)   dumpingE) C) and D)
F) B) and D)

Question 18

To conform to local content regulations, a firm may have to locate more production activities in a given market than it would otherwise.

Accepted Answer

A) True 
 B)False

Question 19

The TRIPS regulations oblige WTO members to grant and enforce patents lasting at least 20 years and copyrights lasting 50 years.

Accepted Answer

A) True 
 B)False

Question 20

What are the central issues facing the WTO at the present time?

Accepted Answer

Four issues at the top of the agenda for...

Exam 7: Government Policy and International Trade

Which of the following is a political reason for governments to intervene in markets?

Correct Answer
verified

The TRIPS regulations oblige WTO members to grant and enforce patents lasting at least 20 years and copyrights lasting 50 years.

Correct Answer
verified

Tariff rates on agricultural products are generally:

Correct Answer
verified

According to the strategic trade policy argument:

Correct Answer
verified

If a domestic industry lacks the capacity to meet demand, an _____ can raise prices for both the domestically produced and the imported good.

Correct Answer
verified

GATT has not recognized the infant industry argument as a legitimate reason for protectionism.

Correct Answer
verified

Antidumping policies vary drastically from country to country.

Correct Answer
verified

What are the central issues facing the WTO at the present time?

Correct Answer
verified
Four issues at the top of the agenda for...
View Answer

To conform to local content regulations, a firm may have to locate more production activities in a given market than it would otherwise.

Correct Answer
verified

The threat of _____ limits the ability of a firm to use aggressive pricing to gain market share in a country.

Correct Answer
verified

Correct Answer
verified

According to the Buy America Act, if a company wishes to win a contract from a U.S. government agency to provide some equipment, it must ensure that at least 51 percent of the product by value is manufactured in the United States. This is an example of:

Correct Answer
verified

The WTO's GATS has taken the lead to:

Correct Answer
verified

What is dumping? How do governments respond to charges of dumping?

Correct Answer
verified
Dumping is defined as selling goods in a...
View Answer

The _____ specifies that government agencies must give preference to American products when putting contracts for equipment out to bid unless the foreign products have a significant price advantage.

Correct Answer
verified

_____ are levied as a proportion of the value of the imported good.

Correct Answer
verified

During the 1980s and early 1990s, the world trading system erected by the GATT gained momentum as protectionist demands generally decreased across the world.

Correct Answer
verified

Antidumping duties are often called:

Correct Answer
verified

Under a tariff rate quota, a higher tariff rate is applied to imports within the quota than those over the quota.

Correct Answer
verified

A company that sells its product in a foreign market below the cost of production may be accused of _____.

Correct Answer
verified

Exam 7: Government Policy and International Trade

Which of the following is a political reason for governments to intervene in markets?

Correct AnswerverifiedShow Answer

The TRIPS regulations oblige WTO members to grant and enforce patents lasting at least 20 years and copyrights lasting 50 years.

Correct AnswerverifiedShow Answer

Tariff rates on agricultural products are generally:

Correct AnswerverifiedShow Answer

According to the strategic trade policy argument:

Correct AnswerverifiedShow Answer

If a domestic industry lacks the capacity to meet demand, an _____ can raise prices for both the domestically produced and the imported good.

Correct AnswerverifiedShow Answer

GATT has not recognized the infant industry argument as a legitimate reason for protectionism.

Correct AnswerverifiedShow Answer

Antidumping policies vary drastically from country to country.

Correct AnswerverifiedShow Answer

What are the central issues facing the WTO at the present time?

Correct AnswerverifiedFour issues at the top of the agenda for...View AnswerShow Answer

To conform to local content regulations, a firm may have to locate more production activities in a given market than it would otherwise.

Correct AnswerverifiedShow Answer

The threat of _____ limits the ability of a firm to use aggressive pricing to gain market share in a country.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

According to the Buy America Act, if a company wishes to win a contract from a U.S. government agency to provide some equipment, it must ensure that at least 51 percent of the product by value is manufactured in the United States. This is an example of:

Correct AnswerverifiedShow Answer

The WTO's GATS has taken the lead to:

Correct AnswerverifiedShow Answer

What is dumping? How do governments respond to charges of dumping?

Correct AnswerverifiedDumping is defined as selling goods in a...View AnswerShow Answer

The _____ specifies that government agencies must give preference to American products when putting contracts for equipment out to bid unless the foreign products have a significant price advantage.

Correct AnswerverifiedShow Answer

_____ are levied as a proportion of the value of the imported good.

Correct AnswerverifiedShow Answer

During the 1980s and early 1990s, the world trading system erected by the GATT gained momentum as protectionist demands generally decreased across the world.

Correct AnswerverifiedShow Answer

Antidumping duties are often called:

Correct AnswerverifiedShow Answer

Under a tariff rate quota, a higher tariff rate is applied to imports within the quota than those over the quota.

Correct AnswerverifiedShow Answer

A company that sells its product in a foreign market below the cost of production may be accused of _____.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Four issues at the top of the agenda for...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Dumping is defined as selling goods in a...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified