Trade Concepts Quiz

________ implies that the national government exerts minimal influence on the exporting and importing decisions of private firms and individuals.

• Fair trade

• Free trade

• Managed trade

• Equitable trade

Free trade ________.

• is another term for managed trade

• implies that the national government exerts minimal influence on the exporting and importing decisions of private firms

• proposes that national governments should directly help domestic firms by providing export subsidies and tax breaks

• suggests that the national government should actively intervene to ensure that domestic firms' exports receive an equitable share of foreign markets and that imports are controlled to minimize losses of domestic jobs and market share in specific industries

Fair trade is sometimes called ________.

• managed trade

• manipulated trade

• illusory trade

• right trade

The ________ holds that a country must be self-sufficient in critical raw materials, machinery, and technology or it will be vulnerable to foreign threats.

• national defense argument

• infant industry argument

• industrial policy

• strategic trade theory

The ________ proposes that tariffs be imposed on imported manufactured goods to give U.S. firms temporary protection from foreign competition until they can fully establish themselves.

• national defense argument

• infant industry argument

• industrial policy

• strategic trade theory

A(n) ________ is a tax placed on a good that is traded internationally.

• tariff

• quota

• par value

• import substitute

Country X applies a tariff on goods as they leave the country. Country X most likely imposes a(n) ________ tariff.

• transit

• ad valorem

• specific

• export

Products manufactured in Brazil are transported through Mexico on their way to England. Mexico applies a tariff on the goods. What type of tariff is implemented by Mexico?

• transit tariff

• ad valorem tariff

• export tariff

• compound tariff

What type of tariff is assessed as a percentage of the market value of the imported good?

• transit tariff

• ad valorem tariff

• specific tariff

• compound tariff

A ________ is a numerical limit on the quantity of a good that may be imported into a country during some time period.

• quota

• numerical export control

• voluntary export restraint

• regulatory control