Question 1

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

Accepted Answer

The Andean Community, originally known as the Andean Pact, was established in 1969 and included Bolivia, Chile, Colombia, Ecuador, and Peru as its founding members. However, Chile withdrew in 1976.

Question 2

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

Accepted Answer

Lowering tax rates can increase disposable income for consumers, leading to higher spending and investment, which can stimulate economic growth.

Question 3

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

Accepted Answer

NAFTA, the North American Free Trade Agreement, was aimed at encouraging trade among North American countries, specifically the United States, Canada, and Mexico, not South American countries.

Question 4

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

Accepted Answer

Tariffs are taxes imposed by a government on goods and services imported or exported from a country, used to regulate trade, protect domestic industries, or generate revenue.

Question 5

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

Accepted Answer

WTO has a well-established dispute resolution process that allows member countries to bring disputes to the organization, where they are heard and a solution or ruling is suggested.

Question 6

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

Accepted Answer

As of my last update, there are 27 EU member countries, but only 19 of these use the euro as their official currency.

Question 7

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

Accepted Answer

During a recession, a country may borrow money to fund essential public services and stimulate the economy, as tax revenues often decrease while demand for services increases.

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.

Accepted Answer

Any member country of the World Trade Organization (WTO) has the right to file a complaint against another member they believe is violating trade agreements, not just privileged members.

Question 9

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

Accepted Answer

The national deficit occurs when a country's government spends more than it receives in revenue, leading to borrowing from the private sector or other countries to cover the shortfall.

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.

Accepted Answer

Countries can and do borrow money for various purposes, including investing in domestic projects such as public sector enhancements and infrastructure development. This is often done through issuing government bonds or taking loans from international financial institutions.

Question 11

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

Accepted Answer

MERCOSUR is focused on promoting economic integration among its member countries in South America, not 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.

Accepted Answer

The General Agreement on Tariffs and Trade (GATT) included a most-favored-nation (MFN) clause, which required that any trade advantage, such as a lower tariff rate, granted by one member country to another had to be extended to all other member countries. This principle aimed to promote equal trading conditions among all member countries.

Question 13

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

Accepted Answer

These are examples of non-tariff barriers. Tariff barriers specifically refer to taxes or duties imposed on imported goods.

Question 14

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

Accepted Answer

GATT's initial focus was on reducing tariffs on goods to promote international trade, not on non-tariff barriers.

Question 15

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

Accepted Answer

The European Union is a political and economic union of 27 European countries, which does not include all the countries in 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.

Accepted Answer

The General Agreement on Trade in Services (GATS) includes a principle of national treatment, which requires member countries to treat foreign service suppliers no less favorably than they treat their own domestic suppliers.

Question 17

Current account deficit refers to imports being greater than exports.

Accepted Answer

A current account deficit occurs when a country's total imports of goods, services, and transfers are greater than its total exports of them.

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.

Accepted Answer

The answer of The US Meat Export Federation (USMEF)entered into...

Question 19

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

Accepted Answer

Intellectual property rights (IPR) law does deal with the financial aspect of a creation of an individual by providing creators with exclusive rights to use, sell, or license their creations, thus enabling them to monetize their intellectual property.

Question 20

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

Accepted Answer

Global businesses frequently have dedicated teams of in-house professionals to monitor the World Trade Organization (WTO) and regional trade alliances to stay informed about trade regulations, policies, and agreements that could affect their operations and strategic decisions.

Quiz 5: Global and Regional Economic Cooperation and Integration