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 social science trade in agricultural produce (part - a) trade in tamil nadu trade in agricultural produce - i human geography in tamil nadu

What is called trade?

  1. Only buying of commodities

  2. Only selling of commodities

  3. Buying and selling of commodities

  4. None of these
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Trade may be defined as "an exchange of goods and commodities either within the country or between countries." In simple terms, buying and selling of commodities is called trade and it may be local, regional, national and international.

Multiple choice social science trade in agricultural produce (part - a) trade in tamil nadu trade in agricultural produce - i human geography in tamil nadu

What is an internal trade?

  1. Trade carried out in the country

  2. Trade carried out with other country

  3. Trade carried out with many countries

  4. None of these
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Buying and selling of commodities and services within the country is known as internal trade. Whether the products are bought from local market, central market, and departmental store or from a door-to-door salesperson, all these are examples of internal trade. No custom duty or import duty is levied on this type of trade. Internal trade is a field of economy that includes both wholesale and retail trade.

Multiple choice meaning and characteristics of negotiable instruments the negotiable instruments act, 1881 commerce

Classification of Negotiable Instruments
An inland instrument is one which is -.
1. Drawn and made payable in India
2. Drawn in India upon some person resident therein, even though it is made payable in a foreign country
Select the correct answer from the options given below-

  1. 2 only

  2. Either 1 or 2

  3. 1 only

  4. None of the above
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation
A promissory note, bill of exchange or cheque drawn or made in India, and made payable in, or drawn upon any person resident, in  India shall be deemed to be an inland instrument.
Multiple choice meaning and characteristics of negotiable instruments the negotiable instruments act, 1881 commerce

Classification of Negotiable Instruments
Which of the following is a foreign instrument ?

  1. It is drawn in India and made payable only outside India.

  2. It is drawn in India and made payable outside India and drawn on a person resident outside India.

  3. Both (A) and (B)

  4. Neither (A) nor (B)
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation
The Negotiable Instruments Act, 1881 defines foreign instrument as any such instrument not so drawn, made or made payable in India shall be deemed to be a foreign instrument. 

Multiple choice organisation of commerce and management tertiary and quaternary economic activities trading and economic organisations india and her neighbours india and other countries

The chief imports of Australia is ________________.

  1. Gold, cotton, iron and rice

  2. Cigarettes, motorcars, cotton clothes, machines and petroleum

  3. Coal, iron and wool

  4. Meat, wheat, silver and woollen clothes
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Australia's import profile historically includes manufactured goods like motorcars, machinery, petroleum products, and various consumer goods like cigarettes and clothing.

Multiple choice business organisation introduction to financial markets concept of financial market meaning and definition of financial market concepts and functions of financial markets

The amount of gold, reserve currencies and special drawing rights available for the finance of International trade is known as ______.

  1. international liquidity

  2. special drawing rights

  3. international monetary fund

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

International liquidity refers to the total stock of assets, such as gold, foreign exchange reserves, and special drawing rights, that a country holds to settle its international payment obligations.

Multiple choice business organisation introduction to financial markets concept of financial market meaning and definition of financial market concepts and functions of financial markets

Giving excess protection to domestic markets, which have high entry barriers for foreign firms, over valuation of exchange indicates the adoption of _________ by the country?

  1. Inward oriented strategy

  2. Inflation control

  3. Liberalization

  4. Outwards oriented strategy

  5. Export promotion strategy
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

The strategy adopted by the developing countries to strengthen the domestic industries by an providing lot of protection to domestic industry in the form of heavy tarrifs/ restrictions on imports is called the inward oriented strategy.

Multiple choice organisation of commerce and management sources of business finance - 2 commercial paper non-institutional sources - short-term short term sources of finance

Identify the merit(s) of Trade credit.

  1. It reduces the capital requirement.

  2. It helps the business focus on core activities.

  3. It does not require any negotiation or formal agreement.

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

Trade credit can be defined as delay of payment permitted by the creditor or supplier of raw materials, consumables etc. against the goods purchased from him. Merits of Trade credit are:a) It reduces the capital requirement.b) It helps the business focus on core activities.

c) It does not require any negotiation or formal agreement.

Multiple choice organisation of commerce and management sources of business finance - 2 commercial paper non-institutional sources - short-term short term sources of finance

Likely disadvantage(s) of using trade credit include ___________.

  1. Loss of goodwill

  2. Higher prices of raw materials

  3. The opportunity cost of discount

  4. All of the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation
Trade credit is issued when goods and services are traded on credit. It is offered by one seller to the other.Disadvantage(s) of using trade credit include:a) loss of goodwill
b) higher prices of raw materials
c) the opportunity cost of discount.
Multiple choice organisation of commerce and management sources of business finance - 2 commercial paper non-institutional sources - short-term short term sources of finance

Trade credit is a convenient and continuous source of funds, which is one of the __________ of trade credit.

  1. Limitations

  2. Merits

  3. Functions

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

Trade credit is a short term source of finances where a trader credits finances to another trader for the smooth flow of business. Trade credit is a convenient and continuous source of funds as it is a short term credit and has a low amount value hence can be taken without long term financial plannings. This is one of the merits of trade credit.

Multiple choice organisation of commerce and management multinational corporations global enterprises meaning and features of mncs public sector undertakings & global enterprises

Promotion of Global co-operation through an MNC is an advantage gained by _________.

  1. home country

  2. host country

  3. both country

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

Home Country in international compensation, this is the country upon which an expatriate's compensation is based. It is usually the expatriate's home country or the country in which the employee's headquarters is located.

Multiple choice organisation of commerce and management multinational corporations global enterprises meaning and features of mncs public sector undertakings & global enterprises

Aim for MNCs drive is to ___________.

  1. avoid trade barriers

  2. meet different rules and regulations (avoid non-tariff barriers)

  3. secure supplies of raw materials or markets

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

Business enterprises wants to be international because it has many advantages. It avoids trade barriers which are the rules and regulations that regulates foreign trade and investment. Tarrif is the tax imposed by the government on the import and export of goods. MNC get some relaxation in these tarrifs. Secure, timely and cost effective supply of raw materials is the backbone of any enterprise. MNC can get easy access to the raw materials as it can set up operations where the raw materials are easily found which in turn reduces the production cost.