Economics · General Awareness

International Trade Economics

2,124 Questions

International trade economics covers the exchange of goods and services across borders, encompassing theories like comparative advantage and policies such as tariffs. Key concepts include the balance of payments, free trade agreements, and globalization measures. These topics are frequently asked in UPSC, State PSC, and other competitive exams to test economic awareness.

Balance of paymentsTrade policy and tariffsFree trade agreementsComparative advantage theory

International Trade Economics Questions

Multiple choice commerce types of trade features of internal trade internal trade business and industry

Which of the following is true in relation to internal trade?

  1. No custom duty or import duty is levied on such trade as goods are part of domestic production and are meant for domestic consumption

  2. Generally, payment has to be made in the legal tender of the country or any other acceptable currency

  3. Internal trade can be classified into two broad categories

  4. All of the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation
  • Buying and selling of goods and services within the boundaries of a nation are referred to as internal trade.
  • No custom duty or import duty is levied on such trade as goods are part of domestic production and are meant for domestic consumption.
  • Generally, payment has to be made in the legal tender of the country or any other acceptable currency.
  • Internal trade can be classified into two broad categories viz., (i) wholesale trade and (ii) retail trade.
Multiple choice commerce types of trade features of internal trade internal trade business and industry

NAFTA is____________________.

  1. treaty signed between two companies of Europe

  2. free trade between America and Europe

  3. free trade agreement between US, CANADA and MEXICO.

  4. free treaty between any two countries
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

The North American Free Trade Agreement, which eliminated most tariffs on trade between Mexico, Canada and the United States, went into effect on Jan. 1,1994.NAFTA's purpose is to encourage economic activity between North America's three major economic powers.

Multiple choice commerce types of trade features of internal trade internal trade business and industry

WTO helped in_________.

  1. privatization

  2. cross burden trade

  3. helped in providing political stability for companies who are doing international business

  4. all of the above.
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

The World Trade Organization is an intergovernmental organization that regulates international trade. The WTO officially commenced on 1 January 1995 under the Marrakesh Agreement, signed by 124 nations on 15 April 1994, replacing the General Agreement on Tariffs and Trade, which commenced in 194

Multiple choice business organisation and correspondence commerce and modern civilization history of commerce in india hindrances of commerce historical background of commerce in the sub-continent

The hindrance of ____ is removed by trade thereby making goods available to the consumers from the producers.

  1. place

  2. persons

  3. time

  4. knowledge
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Trade involves the buying and selling of goods, which connects producers to consumers, thereby removing the hindrance of persons (the gap between who produces and who consumes).

Multiple choice function, distinction and objectives of chambers of commerce role of chambers of commerce & industry and trade associations internal trade commerce business studies

Identify the interests and aims of Chambers of Commerce and Industry.

  1. Transportation or inter-state movement of goods.

  2. Octroi or other local levies.

  3. Harmonisation of VAT structure.

  4. All of the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation
Interests and aims of chambers of commerce and industry:
(i) Transportation or inter state movement of goods: The Chambers of Commerce and Industry help in many activities concerning inter state movement of goods which includes registration of vehicles, surface transport policies, construction of highways and roads.
(ii) Octroi and other local levies: Octroi and local taxes are the important sources of revenue of the local government. These are collected on the goods and from people entering the state or the municipal limits.
(iii) Harmonisation of sales tax structure and Value Added Tax: The Chambers of Commerce and Industry play an important role in interacting with the government to harmonise the sales tax structure in different states.
Multiple choice history polity and society in post-mauryan period trade between tamizhagam and rome kushans, sakas and hunas post mauryan india

Being Muslim as a Southeast Asian merchant _______________________.

  1. was against the law in most trading cities.

  2. entitled the merchant to better interest rates when doing business in Muslim Asia.

  3. was compulsory in order to do business in Malaka.

  4. was often an advantage when dealing with Muslim Indian traders.
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

In the context of historical maritime trade in Southeast Asia, Muslim merchants often shared a common religious and legal framework with other Muslim traders in the Indian Ocean, which facilitated trust and business relations.

Multiple choice business organisation and correspondence components of business studies factors affecting business interrelationship between industry, commerce and trade other aspects of a business

Singapore and Middle East countries are the best examples for entrepot trade.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Singapore and Middle East countries are the best examples for entrepot trade- this is a true statement. Entrepot is mainly used to refer to duty-free ports with the high volume or re-export. At entrepot, goods do not face any import or export duties upon shipment from the port.

Multiple choice economics government budget and economy trade deficits, savings and investment public finance and budget public finance, taxes and budget

Adverse balance of payment can be corrected through _________.

  1. more export

  2. import ban

  3. devaluation of currency

  4. all of the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

An adverse balance of payment can be addressed by increasing exports, restricting imports, or devaluing currency to make exports cheaper and imports more expensive.

Multiple choice economics government budget and economy trade deficits, savings and investment public finance and budget public finance, taxes and budget

When a country's imports are higher than its exports, the balance is termed as ___________.

  1. trade deficit

  2. trade inflow

  3. income deficit

  4. none of the above
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

When a country's imports are higher than its exports, the value of goods coming in exceeds the value of goods going out, resulting in a trade deficit.

Multiple choice economics government budget and economy trade deficits, savings and investment public finance and budget public finance, taxes and budget

Trade deficit is a situation where:

  1. a country's exports exceeds its imports.

  2. a country's imports exceeds its exports.

  3. there is depreciation of the currency

  4. the government fails
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

A trade deficit is defined as the situation where the value of a country's imports exceeds the value of its exports.

Multiple choice commerce nature and scope of foreign trade characteristics, necessity, importance, advantages and disadvantages of foreign trade importance, scope and benefits of international trade trading and economic organisations

Foreign trade involves much greater risk than home trade.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation
  • Economic dependence: Too much dependence on imports may undermine the economy of a country.
  • Restricted growth of home industries: Foreign trade may discourage the growth of domestic industries.
  • Misuse of natural resources.
  • Political exploitation.
  • Import of harmful goods.
  • Rivalry among nations.
  • Invasion of culture.