Review for SW Asia Economics Summative

Front

If OPEC cut oil production for next year, what would most likely be the effect?

Back

oil prices would most likely rise

Front

Tariffs, quotas, and subsidies are examples of

Back

trade barriers.

Front

What Year was OPEC Created?

Back

1960

Front

What is OPEC's main purpose?

Back

To regulate and stabilize the price of oil on the world market

Front

Which industry does the government of Saudi Arabia heavily control? Options: oil, technology, agricultural, textile manufacturing

Back

oil

Front

What incentive might a country's national government have to improve education and literacy?

Back

Educated populations have a higher standard of living than uneducated populations.

Answer explanation

Remember that literacy is almost always directly tied to GDP!

Front

Which answer describes economic specialization? Options: An economy in which producers look to the past to answer the three economic questions. An economy with all trade barriers removed. An economy where the government answers all the economic questions. An economy where producers produce goods they can create most efficiently and trade for others.

Back

An economy where producers produce goods they can create most efficiently and trade for others.

Answer explanation

Specialization increases the efficiency of production so more goods can be produced in a shorter amount of time!

Front

What is a tariff?

Back

A tax on goods imported from another country

Front

Why would a government want to place an embargo?

Back

To encourage a country to change policies.

Answer explanation

Remember the US embargo on Cuba. It was placed because the US did NOT like Cuba's communist practices!

Front

How is an embargo different from any other trade barrier?

Back

Embargoes cause an end to all trade across a range of goods.

Answer explanation

Tariffs and Quotas are LIMITS on trade in some way. A tax limits how much people may be willing to trade by taxing things; where a quota literally limits the amount allowed. An embargo completely bans all trade.