International Trade Economics

The biggest or greatest amount of involvement in a foreign market comes through direct investment.

Dumping is the pricing in the international market. It happens when manufacturers export a product to another country at a price either below the price charged in its home market or below its cost of production.

Globalisation refers to the integration of domestic economies with the world economy through increased cross-border trade, investment, and flow of technology and information. It involves removing barriers between national economies and creating a more interconnected global marketplace. Option A correctly defines globalisation as integrating domestic and world economies.

The World Trade Organization (WTO) was established to regulate international trade between nations. It acts as a permanent watchdog by monitoring trade policies, resolving trade disputes, and enforcing trade rules among member countries. The WTO ensures that trade flows smoothly, predictably, and freely. Option C correctly identifies WTO as the international trade watchdog.

After the 1991 economic reforms, India removed quantitative restrictions on most imports except for a few sensitive items like consumer goods and agricultural products. Option A is incorrect as QRs were removed, not imposed. Option C is incorrect as tariff walls were reduced, not raised. Option D is incorrect as foreign investment was encouraged through FDI liberalization.

The term 'international liquidity' connotes the world supply of reserves of gold and currencies which are freely usable internationally, such as dollars and sterling, plus facilities for borrowing these.

Bertil Ohlin (note spelling correction from 'Bertic') developed the Heckscher-Ohlin model of international trade, which explains trade patterns based on factor endowments. The model shows that countries export goods that use their abundant factors of production and import goods that use their scarce factors. This fundamental theory (with Eli Heckscher) earned Ohlin the Nobel Prize in Economics in 1977. Adam Smith proposed absolute advantage theory, while Arthur Okun is known for Okun's Law in macroeconomics.

ASEAN aims include accelerating economic growth, social progress, and sociocultural evolution among its members, alongside protection of regional stability as well as providing a mechanism for member countries to resolve differences peacefully.

Correct answer is (3). 

The Dunkel Draft (1991) was the key WTO proposal that introduced TRIPS (intellectual property rights) and TRIMS (investment measures). It was named after Arthur Dunkel, GATT Director-General. The Chelliah Committee dealt with Indian tax reform. Preston Proposal is unrelated to WTO agreements.

The WTO (World Trade Organization) is the primary international body that governs global trade rules, resolves trade disputes between nations, and ensures trade flows as smoothly, predictably, and freely as possible.

GATT (General Agreement on Tariffs and Trade), established in 1947, was the precursor to the WTO which was formed in 1995 to expand and formalize the global trading system with a more comprehensive institutional framework.

WTO is the primary international organization dealing with global trade rules, dispute settlement, and ensuring trade flows smoothly between nations. While IMF handles international monetary stability and World Bank provides development financing, WTO specifically oversees international trade agreements and resolves trade disputes.

Protectionism is the economic policy of restraining trade between countries

A foreign country that is an export import intermediary is termed as an entrepot.