Foreıgn Trade Ara 2. Deneme Sınavı
Toplam 20 Soru1.Soru
- Production possibilities frontier
- The offer curve
- The autarky relative price line
- The indifferent curve
- The opportunity cost
The intersection of which of the above determine the general equilibrium of an economy?
I-II-III |
II-III-IV |
I-III-IV |
I-II-V |
II-III-V |
General equilibrium of an economy is determined by the intersection of the production possibilities frontier, the autarky relative price line, and the indifferent curve.
2.Soru
Which one of the following terms refers to technologies that build 3D objects by adding layer-upon-layer materials of different kinds like plastics and metals?
Additive Manufacturing |
Digital economy |
Business-to-business e-commerce |
Business-to-consumer e-commerce |
Merchandise trade |
Additive Manufacturing (AD): It refers to technologies that build 3D objects by adding layer-upon-layer materials of different kinds like plastics and metals.
3.Soru
Which of the following deals with the international distribution of income?
Stolper-Samuelson Theorem |
Heckscher- Ohlin Theory |
Classical Trade Theory |
The international trade theory |
International Factor Price Equalization Theorem |
International Factor Price Equalization Theorem deals with the international distribution of income. Stolper-Samuelson Theorem deals with the distribution of income effects of international trade within a trading country. Heckscher-Ohlin Theory states that comparative advantage of the trading countries is explained exclusively by differences in relative supply conditions. Classical Trade Theory which has been accepted as the primer of the international trade theory assumes that the country whose labor is more productive in producing the commodity that is subject to international trade has a comparative advantage in this commodity. Briefly, the basis of international trade solely depends on the differences of labor productivity.
4.Soru
How is the concept of " general equilibrium of an economy " determined?
It is determined by the intersection of the production possibilities frontier, the autarky relative price line, and the indifferent curve. |
The price of one commodity is expressed in terms of the price of the other commodity. |
It displays the autarky equilibrium in our hypothetical countries, Sunland and Lakeland. |
The autarky equilibrium is determined at point A for Sunland where the production possibilities frontier, |
It is impossible for both Sunland and Lakeland to reach to this further level of utility. |
General equilibrium of an economy is determined by the intersection of the production possibilities frontier, the autarky relative price line, and the indifferent curve. The correct answer is " A ".
5.Soru
Who are the first economists who developed a more detailed analysis on the differences in productivity?
Adam Smith, |
David Ricardo, |
Eli Heckscher and Bertil Ohlin, |
Eli Heckscher and David Ricardo, |
Bertil Ohlin and Adam Simith, |
The first economists who developed a more detailed analysis on the differences in productivity are Eli Heckscher and Bertil Ohlin. The correct answer is " C ".
6.Soru
According to the Theory of Absolute Advantage, A country has an absolute advantage in the production of a good relative to another country if…………………………….?
it can produce the good at a lower cost or with a higher productivity, |
it can produce the good at alot or with a higher efficiency, |
it can produce the good at a lower opportunity cost, |
it can produce the good with a capital intensive production, |
it can produce the good with a labor intensive production, |
Theory of Absolute Advantage
The theory was introduced in Adam Smith’s “Wealth of Nations”, published in 1776. By assuming that each country could produce some commodities using less labour than its trading partners, he showed that all parties could benefit from international trade. Trade improved the allocation of labour, ensuring that each good would be produced in the country where the good’s production required the least labour. Result would be a larger total quantity of goods produced in the world. Trade would be a positive-sum game. A country has an absolute advantage in the production of a good relative to another country if it can produce the good at a lower cost or with a higher productivity. If the input prices are the same in both countries, the country with an absolute advantage will have lower unit production cost for that good. A country should produce and export products in which it has an absolute advantage, and a country should import products in which it has a disadvantage.
7.Soru
Which one of the following statements is wrong considering the assumptions of Heckscher-Ohlin Theory?
Demand preferences might differ both countries |
There is perfect competition in the commodities and the factor markets in both countries |
There is free movement of factors of production within each country but no free movement of factors of production between countries |
There is free trade between the trading countries |
There is full employment in all resources in both trading countries |
Demand preferences are the same in both countries: Along with rapid globalization, demand preferences are more or less the same across countries. Thus, this assumption of the HeckscherOhlin Theory is probably the one that best fits today’s international trade environment.
8.Soru
I. Mercantilism can be said to be a recent theory of international trade
II. According to the mercantilist doctrine, countries should export more than they import
III. For Mercantilism, the prosperity of a nation is dependent upon its supply of capital
Which one(s) of these statements is/are true about Mercantilism?
Only I |
Only II |
Only III |
I-II |
II-III |
Mercantilism can be said to be the first theory of international trade (Shenkar, Luo, Chi, 2004, p. 17). According to the mercantilist doctrine, countries should export more than they import. World wealth (gold or silver stock) is constant and cannot be increased. Therefore, there is always a contradiction among the foreign trade countries. Mercantilism is
an economic theory that holds that the prosperity of a nation is dependent upon its supply of capital, and that the global volume of international trade is “unchangeable”
9.Soru
When in production the positive economies of scale occurs?
when the cost of producing a unit of commodity decreases as its output rate increases. |
when the cost of producing a unit of commodity increases as its output rate increases. |
when the average cost of producing a additional unit of commodity decreases as its output rate increases. |
when the marginal cost of producing extra unit decreases as its output rate decreases. |
when the total cost of production decreases as its output rate increases. |
KEY TERMS AND CONCEPTS OF INTERNATIONAL TRADE
Positive economies of scale exist when the cost of producing a unit of commodity decreases as its output rate increases.
10.Soru
Who supported David Ricardo in terms of comparative advantage law?
Robert Torrens |
Gottfried Haberler |
Adam Smith |
Eli Heckscher |
Bertil Ohlin |
Ricardo based his explanation of the comparative advantage law on the labour value theory, which was later rejected. In the first part of the twentieth century, Gottfried Haberler came to save Ricardo, explaining the comparative advantage law in terms of opportunity cost theory, as reflected in the possibilities of production possibilities or in the transformation curves.
11.Soru
The production possibilities frontier of a capital-abundant country is:
Skewed toward the axis that measures the labor-intensive commodity. |
Skewed toward the axis that measures the capital-intensive commodity. |
Skewed toward the axis that measures labor. |
Skewed toward the axis that measures capital. |
Not skewed towards any of the axis. |
The production possibilities frontier of a labor-abundant country is skewed toward the axis that measures the labor-intensive commodity. The production possibilities frontier of a capital-abundant country is skewed toward the axis that measures the capital-intensive commodity.
12.Soru
Which of the following statement correctly defines terms of trade?
the ratio of exports to imports. |
the ratio of the price index of its exports to imports. |
the ratio of exports to the price index of imports. |
the ratio of the price index of its exports to the price index of its imports. |
the ratio of commodity trade to barter trade. |
KEY TERMS AND CONCEPTS OF INTERNATIONAL TRADE-Terms of trade
Another key term which is used within the scope of international trade is terms of trade. Terms of trade of a nation are found by the ratio of the price index of its exports to the price index of its imports. If this ratio is to be expressed in percentage, it is multiplied by hundred. These terms of trade can also refer to commodity terms of trade or net barter terms of trade.
13.Soru
Which one of the following refers to the quantity of a good that can be produced per unit of labor input?
Homogeneous |
Natural Advantage |
Labor productivity |
autarky |
Acquired Advantage |
Labor productivity: The quantity of a good that can be produced per unit of labor input. It is the reciprocal of the unit labour requirement.
14.Soru
What is the name of the way to show a nation’s offer to export and import?
Natural Advantage |
Labor productivity |
Autarky |
Opportunity cost |
Offer curve |
An offer curve is a way to show a nation’s offer to export and import.
15.Soru
"The quantity of a good that can be produced per unit of labor input"
What does this sentence define?
Comparative advantage |
Homogeneous |
Heterogeneous |
Large scale production |
Labor productivity |
Labor productivity: The quantity of a good that can be produced per unit of labor input. It is the reciprocal of the unit labour requirement.
16.Soru
Which one of the following statements on international trade is wrong?
International monetary part of international economics deals with financial transactions |
Decrease in the terms of trade refers to an improvement in the terms of trade |
Increase in the terms of trade is referred to an improvement in the terms of trade |
If total imports are more than the total exports within an economy, then there is a trade deficit |
When total exports exceed total imports, it means that there is a trade surplus |
Decrease in the terms of trade refers to a deterioration in the terms of trade.
17.Soru
In terms of patent rights which one below is protected by patents?
Books |
drawings of a new machine |
paintings |
films |
brand names |
They are a type of intellectual property rights. Intellectual property is a general term referring to creations of the mind. Intellectual property rights designate creators with the right to protect themselves from the imitators for a limited period of time. Intellectual property rights have many types. For example; books, paintings and films are protected by copyrights while eligible inventions are protected by patents and brand names and product logos are registered as trademarks
18.Soru
Which one of the following refers to a reduction in the average cost of a firm in conjunction with the increase within the size of the industry?
External economies of scale |
Internal economies of scale |
Constant returns to scale |
Price competitiveness |
Brand competitiveness |
External economies of scale exist when the cost per unit of production depends on the size of the industry. In other words, average cost of production decreases as the scale of the industry increases. It refers to a reduction in the average cost of a firm in conjunction with the increase within the size of the industry.
19.Soru
Which country is one of the top trading countries in merchandise trade in 2017?
India |
Japan |
South Korea |
United Kingdom |
China |
In 2017, the top trading countries in merchandise trade are China, the US, and Germany. In total exports, China is the leader but in total imports it is the US while the position of Germany is the same in both rankings, the third. The correct answer is "E".
20.Soru
Which of the following is not one of the main reasons for intra-industry trade?
Transportation costs |
Product differentiation |
Internal economies of scale |
Scope of commodity classification |
Similarities in distribution of income |
The main reasons for intra-industry trade are: internal economies of scale, product differentiation, transportation costs, scope of commodity classification and differences (not similarities) in distribution of income. The correct answer is E.
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