Deck 5: Global and Regional Economic Cooperation and Integration

Question 1

The Andean Community is a free trade agreement signed in 1969 between Bolivia, Chile, Colombia, Ecuador, and Peru.

Answer 1

True

Question 2

A country may resort to reducing the tax rates on its citizens in order to stimulate its economy.

Answer 2

True

Question 3

The goal of NAFTA has been to encourage trade between the South American countries.

Answer 3

False

Question 4

Tariffs refer to taxes, which are placed on imports or exports.

Question 5

WTO functions as a trade facilitator for the member countries but it has no power to hear disputes or suggest a solution.

Question 6

There are more EU member countries than there are countries using the euro.

Question 7

A country borrows money during a recession in order to keep its basic public services operating until the economy improves.

Question 8

Only privileged members can file a complaint with the WTO against another member they believe is dumping, unfairly subsidizing or violating any other trade agreement.

Question 9

The national deficit is the amount of borrowing that a country does from either the private sector or other countries.

Question 10

A country is not allowed to borrow money for investing in domestic projects such as investing in the public sector or building infrastructure.

Question 11

MERCOSUR is committed to the consolidation of democracy and the maintenance of peace throughout the Asian continent.

Question 12

One of GATT's key provisions stated that if the most-favored-nation clause status was granted by a country to another country, then it was automatically extended to all other member countries.

Question 13

Government procurement and bidding, industrial standards, and subsidies are examples of tariff trade barriers.

Question 14

GATT's initial focus was on non-tariff barriers of trade.

Question 15

The European Union (EU)consists of the same countries as the continent of Europe.

Question 16

The General Agreement on Trade in Services (GATS)requires member nations to treat foreign service companies as they would domestic ones.

Question 17

Current account deficit refers to imports being greater than exports.

Question 18

The US Meat Export Federation (USMEF)entered into an agreement to expand access for US beef to Japan after US President Donald Trump took office.

Question 19

Intellectual property rights (IPR)law does not deal with the financial aspect of a creation of an individual.

Question 20

Global businesses often have teams of in-house professionals monitoring the WTO as well as the regional trade alliances.

Question 21

If a country finds another country's trade practices unfair or discriminatory, WTO could:

A)impose trade sanctions but not a cash fine against the guilty country.
B)recommend a suspension from the international body.
C)hear from both countries and make a ruling.
D)recommend the guilty country's eviction from other international bodies.
E)impose a cash fine but not trade sanctions against the guilty country.

Question 22

National deficit refers to:

A)the amount of borrowing that a country does from either the private sector or other countries.
B)the market value of all final goods and services produced within a country in a given period.
C)the accounting record of all monetary transactions between a country and the rest of the world.
D)imports being greater than the exports.
E)the net inflow of investment to acquire a lasting management interest in an enterprise operating in an economy other than that of the investor.

Question 23

The _____ resulted in the end of GATT.

A)Geneva Round
B)Tokyo Round
C)Uruguay Round
D)Doha Round
E)Annecy Round

Question 24

The _____ is the only institutional body charged with facilitating free and fair trade between member nations.

A)World Bank
B)International Monetary Fund
C)United Nations Economic and Social Council
D)World Trade Organization
E)General Agreement on Tariffs and Trade

Question 25

The trade meetings of GATT were called rounds in reference to the:

A)number of times that the representatives had to meet to come to a conclusion.
B)number of ministerial levels in which these meetings were held.
C)geometrical structure of the GATT headquarters where the meetings took place.
D)series of meetings among global peers held at a "roundtable."
E)GATT Director General's habit of rounding off trade figures in the meetings.

Question 26

The _____ , headquartered in Geneva (Switzerland,)is the current round of WTO trade meetings:

A)Annecy Round
B)Tokyo Round
C)Uruguay Round
D)Geneva Round
E)Doha Round

Question 27

Dumping refers to a situation when a company:
a.exports to a foreign market at a price that is either higher than the domestic prices in that country or higher than the cost of production.
b.imports to the domestic market at a price that is either higher than the domestic prices in that country or higher than the cost of production.
c.exports to a foreign market at a price that is either lower than the domestic prices in that country or less than the cost of production.
d.manufactures goods and sells them in the same country at a price which is lower than the prices in that market.
exports to a foreign market at a price that is either the same or higher than the country from where the goods are being exported.

Question 28

The United States, the United Kingdom, Russia, China, and France have permanent representatives in the UN's Security Council.

Question 29

Taiwan has been prevented from membership because of the political issue with China and has only been granted observer status by the United Nations.

Question 30

The basic underlying principle of GATT was:

A)free and equal trade.
B)it was unethical to form trade blocs by the developed nations.
C)that free trade was unrealistic and damaging to individual nations.
D)that tariff barriers were important for the development of a country.
E)that the MFN concept was anti-trade and discriminatory in nature.

Question 31

Global firms in general prosper best in times of conflict.

Question 32

Which of the following is true of the General Agreement on Trade in Services (GATS)?

A)It eliminated the focus of WTO from the goods sector.
B)It introduced service guidelines favoring the developing nations.
C)It sought to reduce the movement of high-end professional services.
D)It sought to reduce the barriers to trade in services.
E)It sought to categorize services and impose tariffs accordingly.

Question 33

The decisions taken by the Security Council are not binding on the rest of the member nations of the UN.

Question 34

Current account deficit refers to:

A)the amount of borrowing that a country does from either the private sector or other countries.
B)the market value of all final goods and services produced within a country in a given period.
C)the accounting record of all monetary transactions between a country and the rest of the world.
D)imports being greater than the exports.
E)the net inflow of investment to acquire a lasting management interest in an enterprise operating in an economy other than that of the investor.

Question 35

Intellectual property refers to:

A)the physical infrastructure of an organization.
B)the magazines and journals that are subscribed to by an organization.
C)the property acquired by an organization in case of a takeover.
D)the skilled manpower of an organization.
E)anything that a person or entity creates with the mind.

Question 36

Duties and customs, taxes, and licensing are examples of:

A)intellectual trade property rights.
B)tariff trade barriers.
C)non-tariff trade barriers.
D)General Agreement in Trades and Services.
E)balance of payments.

Question 37

The primary impact for businesses in a conflict is in the areas of staffing, operations, regulations, and currency convertibility and financial management.

Question 38

The UN works closely with the public sector, which actually carries out the UN's vast amount of services and projects around the world.

Question 39

The _____ is a series of rules governing trade that were first created in 1947 by 23 countries.

A)Pacific Accord ^{HYPERLINK "http://en.wikipedia.org/wiki/List_of_free_trade_agreements" \l "cite_note-3#cite_note-3"}
B)G-3 Free Trade Agreement
C)General Agreement on Tariffs and Trade
D)Southern Common Market
E)North American Free Trade Agreement

Question 40

A film studio produces a movie whose storyline is borrowed from a book.The film producer had not received permission from the book's author to portray the contents of the book in the movie.This act of the movie producer is:

A)fair and above board in the eyes of law.
B)considered legal in developing countries.
C)an example of an exception to TRIPS.
D)attracts capital punishment in developed countries.
E)a violation of the intellectual rights of the author.

Question 41

The purpose of the European Parliament is to:

A)debate and amend legislation proposed by the European Commission.
B)collectively function as the European Union's "Head of State."
C)provide day-to-day leadership and initiate legislation.
D)review, interpret, and apply the treaties and laws of the European Union.
E)make laws on domestic matters for the member countries.

Question 42

Free trade advocates considered the establishment of _____ as a stepping stone toward the more ambitious grouping for a free trade agreement that would encompass the entire American continent except Cuba.

A)GCC
B)CAFTA-DR
C)CARICOM
D)the Andean Community
E)MERCOSUR

Question 43

_____ refers to a kind of economic cooperation wherein countries enter into an economic agreement to remove barriers to trade and adopt common economic policies.

A)Common market
B)Customs union
C)Free trade area
D)Economic union
E)Special economic zone

Question 44

Common market refers to the:

A)kind of economic cooperation wherein members are free to independently determine trade policies with nonmember nations.
B)type of regional economic cooperation wherein countries adopt common economic policies.
C)kind of economic cooperation wherein the body regulating the market frames the economic policies of the member countries individually.
D)type of regional economic cooperation wherein there are no restrictions on the movement of labor and capital between member countries.
E)geographical region which has economic and other laws that are more free-market-oriented than a country's national laws.

Question 45

Maquiladoras refer to the:

A)customs duty imposed by the member countries of the North American Free Trade Agreement on the movement of goods and services from nonmember countries.
B)customs duty imposed by the European Union on the movement of goods and services from countries which are not the members of this economic body.
C)manufacturing units that are located in the border towns of Spain that take imported materials and produce the finished goods for export, primarily to France and Algeria.
D)production facilities located in border towns in Mexico that take imported materials and produce the finished goods for export, primarily to Canada or the United States.
E)the free trade zones established in Argentina to attract foreign direct investment from companies manufacturing machinery and motor vehicles.

Question 46

The European Union is an example of an economic union because:

A)the union frames the economic policies of the member countries individually.
B)some areas of the member countries have economic and other laws that are more free-market-oriented than the country's national laws.
C)the union frames common administrative policies for the member countries.
D)member countries are free to independently determine trade policies with nonmember nations.
E)the member countries have adopted common economic policies.

Question 47

Which of the following statements is true about the European Council?

A)It provides day-to-day leadership and initiates legislation.
B)It reviews, interprets, and applies the treaties and laws of the European Union.
C)It makes laws on domestic matters for the member countries.
D)It debates and amends legislation proposed by the European Commission.
E)It collectively functions as the European Union's "Head of State."

Question 48

What is CEFTA?

A)It is the only regional trading group that uses the term "member economies" rather than "countries."
B)It is a trading group that focuses on the development of the coal and steel industries in Europe for peaceful purposes.
C)It is a trade agreement between the European countries in Northern and Western Europe.
D)It is a trading group that focuses on economic, social, cultural, and technical cooperation as well as promoting regional peace and stability in Northern Europe.
E)It is a trade agreement between non-EU countries in Central and Southeastern Europe.

Question 49

NAFTA rules state that:

A)organizations from communist countries shall be barred from accessing the markets of the NAFTA region.
B)at least 50 percent of the employees in an organization should be from the NAFTA region for the organization to have access to the markets of that region.
C)organizations which do not source labor or capital from the NAFTA region shall not be allowed to enter the market.
D)at least 50 percent of the net cost of most products must come from or be incurred in the NAFTA region.
E)the member countries have to establish a common set of trading rules for nonmember countries.

Question 50

When it was introduced, NAFTA was highly controversial because:

A)it could compromise the national security of the United States.
B)it could lead to the sending of U.S.jobs to Mexico.
C)it could lead to economic hegemony by Canada.
D)it could lead to the dumping of cheap Canadian goods in the United States.
E)it could antagonize other regional trading groups in America.

Question 51

What was the primary goal for the development of the European Union (EU)?

A)To use it as a platform to further European military and political goals
B)To establish a common financial denomination for the whole world
C)To bar non-European countries from trading with European countries
D)To create a larger trading platform to compete against the United States, China, and India
E)To transform Europe and Asia into a single political and administrative unit

Question 52

The _____ provides the day-to-day leadership and initiates legislation.

A)European Commission
B)European Parliament
C)European Council
D)Council of the European Union
E)Court of Justice

Question 53

The creation of regional trade agreements does not lead to:

A)the creation of more trade opportunities for countries.
B)economic integration that can help expand job opportunities.
C)the facilitation of closer political cooperation.
D)the movement of production to cheaper labor markets.
E)political and economic centralization.

Question 54

_____ refers to a kind of economic cooperation wherein member countries are free to independently determine trade policies with nonmember nations.

A)Free zone
B)Export processing zone
C)Free trade area
D)Free port
E)Free trade zone

Question 55

The Gulf Cooperation Council is an example of a customs union because:

A)the union frames the economic policies of the member countries individually.
B)there are no restrictions on the movement of labor and capital between member countries.
C)member countries agree to treat trade with nonmember countries in a similar manner.
D)member countries are free to independently determine trade policies with nonmember nations.
E)member countries adopt common economic policies.

Question 56

MERCOSUR is an economic trade initiative which:

A)is committed to the consolidation of democracy and the maintenance of peace throughout Southern America.
B)focuses on economic, social, cultural, and technical cooperation as well as promoting regional peace and stability in Northern Europe.
C)focuses on the development of the coal and steel industries in South America for peaceful purposes.
D)is a trade agreement between non-NAFTA countries in Central America.
E)is the only regional trading group that uses the term "member economies" rather than "countries."

Question 57

Trade diversion refers to the:

A)tendency of the member countries to trade more with each other than with nonmember nations due to the removal of trade barriers.
B)movement of production to cheaper labor markets in member countries.
C)movement of workers to job markets to gain access to better jobs and wages.
D)dilution of the political and economic rights of a country.
E)increased number of opportunities for countries to trade with one another by removing the barriers to trade and investment.

Question 58

Trade creation refers to the:

A)movement of workers to job markets to gain access to better jobs and wages.
B)dilution of the political and economic rights of a country.
C)increased number of opportunities for countries to trade with one another by removing barriers to trade and investment.
D)tendency of the member countries to trade more with each other than with nonmember nations due to the removal of trade barriers.
E)movement of production to cheaper labor markets in member countries.

Question 59

Which of the following statements is true about MERCOSUR?

A)It was established as a regional trade agreement between Peru and Venezuela.
B)It is a part of the Caribbean Community and Common Market.
C)It is the world's largest trading bloc.
D)It was established as an answer to the Andean Community.
E)It is a South American trade initiative with clear economic and political goals.

Question 60

The Benelux countries refer to:

A)Belgium, Luxembourg, and Norway.
B)Belgium, Luxembourg, and the Netherlands.
C)Belarus, Luxembourg, and Norway.
D)Belgium, Latvia, and Norway.
E)Belarus, Latvia, and the Netherlands.

Question 61

What was the crucial difference between General Agreement on Tariffs and Trade (GATT)and the World Trade Organization (WTO)?

Question 62

_____ refers to that arm of the United Nations which is responsible for issues related to economics, human rights, and social matters.

A)Amnesty International
B)UNICEF
C)The Economic and Social Council
D)The United Nations Trusteeship Council
E)The International Criminal Court

Question 63

Industrialized countries negotiate free trade and investment agreements with other countries, but exempt _____ from the liberalizing demands of the agreement.

A)educational spending
B)military spending
C)infrastructural spending
D)spending on social measures
E)spending in the health sector

Question 64

One of the primary early missions of _____ was to prevent the domination of Southeast Asia by external powers.

A)ASEAN
B)CEFTA
C)APEC
D)SAARC
E)the Shanghai Cooperation Organization

Question 65

What are the drawbacks of creating regional trade agreements?

Question 66

_____ is a term that refers to the messy mix of crisscrossing nonlinear strands of global bilateral and multilateral trade agreements, that link countries and trading blocs in self-benefiting trading alliances.

A)Maquiladoras
B)GATS
C)TRIPS
D)Spaghetti bowl
E)Caciques

Question 67

What are the circumstances that force a country to borrow money?

Question 68

What was the purpose of the North American Free Trade Agreement (NAFTA)?

Question 69

Euro countries refer to those countries that:
a.use the pound as their national currency.
b.are members of the EU.
c.use the euro as their currency.
d.are in Europe but not members of the EU.
have trade agreements with the EU.

Question 70

What is TRIPS?

Question 71

Which of the following is true about the Secretariat?

A)It is the deliberative body of the UN.
B)It reviews cases concerning war crimes, genocide, ethnic cleansing, and illegal interference by one country in the affairs of another.
C)It oversees the operations of the UN and is technically headed by the Secretary-General.
D)It deals with issues related to peace and security.
E)It oversees all trustee territories under UN custody.

Question 72

Which of the following is true about the UN Trusteeship Council?

A)It hears disputes between nations.
B)It is charged with overseeing all trustee territories under UN custody.
C)It oversees the operations of the UN in the trustee territories and is technically headed by the Secretary-General.
D)It deals with issues related to peace and security.
E)It is the deliberative body of the UN.

Question 73

The _____ makes up the judicial branch of the EU consisting of three different courts.

A)European Commission
B)European Parliament
C)European Council
D)European Court of Human Rights
E)Court of Justice

Question 74

The Security Council is responsible for:

A)issues related to economics, human rights, and social matters.
B)addressing issues related to peace and security.
C)the deliberative body of the UN.
D)the operations of the UN.
E)reviews cases concerning war crimes, genocide, ethnic cleansing, and illegal interference by one country in the affairs of another, among others.

Question 75

What is antidumping?

Question 76

What are the advantages of creating regional trade agreements?

Question 77

The UN is funded by:

A)permanent members of the Security Council.
B)member countries' assessments and contributions.
C)corporate and multinational organizations.
D)developed countries that are members of the organization.
E)compulsory contributions made by ordinary people.

Question 78

The _____ is the deliberative body of the UN and consists of all of the member countries that meet in regular sessions throughout the year.

A)General Assembly
B)Security Council
C)Economic and Social Council
D)Secretariat
E)UN Trusteeship Council

Question 79

Explain GATS.

Question 80

The _____ located in The Hague hears disputes between nations.

A)Secretariat
B)Security Council
C)UN Trusteeship Council
D)European Court of Human Rights
E)International Court of Justice