Chapter 18 International Trade and Finance

| November 9, 2018

46)
Using a graph, illustrate what the market effects of a quota, a tariff, or a
complete ban on imports would be.

18.3 A Brief History of International Tariff and
Trade Agreements

1)
Which of the following trade agreements, which took effect in 1994 and was
implemented over a 15-year period, eliminates all tariffs and other trade
barriers between its members?
A)
North American Free Trade Agreement
B)
World Trade Organization
C)
Asian Pacific Economic Cooperation
D)
GATT

2)
Which of the following groups of countries are members of NAFTA?
A)
Japan, Canada, and Mexico
B)
the United States, Japan, and Mexico
C)
the United States, France, and Germany
D)
the United States, Canada, and Mexico

3)
Which of the following trade agreements provides for the development of a
single market among its members?
A)
North American Free Trade Agreement
B)
World Trade Organization
C)
European Union
D)
Asian Pacific Economic Cooperation

4)
The WTO and GATT promote trade by
A)
reducing tariffs.
B)
eliminating quotas.
C)
reducing agricultural subsidies.
D)
all of the above.

5)
Today, the average U.S. tariff is 4.6% of the value of imported goods, which is
very low by historical standards.

6)
The first major international trade agreement following World War II was the
North American Free Trade Agreement (NAFTA).

7)
What are GATT and the WTO?

18.4 How Exchange Rates Are Determined

1)
The rate at which one currency can be traded for another is called the
A)
terms of trade.
B)
transfer rate.
C)
exchange rate.
D)
coupon rate.

2)
If the price of smoothies is $3.50 in the United States and the exchange rate
is 110 yen per dollar, then what is the yen price of smoothies?
A)
110 yen
B)
240 yen
C)
318 yen
D)
385 yen

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