Name : ------student No : ------

Answer The Following Questions:

Q1: Multiple Choice:

1- National and international trade (I.T) tries to overcome the differences in….

A- tariffs B- languages C- distance D- money and banking systems E- nothing

2- Mercantilism’s were totally against………

A- trade protection B- export subsides C- free trade E- collecting of gold

3- World trade depends upon the absolute advantage ……

A- totally B- majority C- something D- all are correct E- nothing

4- the theory of comparative advantage depends upon the…

A-Opportunity cost B- trade at constant cost C- labor theory D- all are correct E- nothing

5-If a nation gains from I.T, then the consumption point will be…

A – At the production possibility curve (ppc) B- inside the ppc C- above the ppc D- nothing

6-If a nation impose a tariff on imports, then consumer surplus will…

A- decrease B- remain the same C- increase D- nothing correct

7-the most important tool of trade protection other than tariffs…

A- export subsides B- red tape C- quotas D- quality control

8-Which transaction will be registered in the debts side in the current account…

A- export of goods B- exports of services

C- grants to other nation D- grants from other nations

9-The main prediction of H-O about the price of the scarce factor…

A- remain the same B- decline C- increase D- nothing

10-If $4.50 required to purchase J.D2,then the exchange rate is…

A- $4050=J.D B- $1=J.D0.50 C- J.D1=$2.25 D- J.D0.75=$2

Q2: State Weather the following statement are True or False:

1. / ( ) / The production possibility curve indicate the quality of a nation
production.
2. / ( ) / Constant opportunity cost assumes that production factors are fully
employed.
3. / ( ) / With increasing opportunity cost the ppc become concave to the
origin.
4. / ( ) / A nation will gain from I.T when MRT=MRS=ITT.
5. / ( ) / The isoquant curves determine a nation terms of trade.
6. / ( ) / In the study of Japan trade, H-O model was correct at macro level.
7. / ( ) / After liontief paradox most economist believes that the results of
classical theorieshas no values.
8. / ( ) / The Briton woods system was flexible exchange rate system.
9. / ( ) / Difficulties in the money supply by the government’s leads to the
collapse of thegold standard system.
10. / ( ) / Fiscal policy is too great to solve the balance of payments
disequilibrium.
11. / ( ) / Depreciation will increase the prices of national goods locally.
12. / ( ) / Exports subsides is a major tool used by the world countries.
13. / ( ) / NCTAD mainly favors the benefits of developing countries.
14. / ( ) / A nation demand curve for foreign exchange derived from demand on
foreign goods and services.
15. / ( ) / In a flexible exchange rates system the monetary authorities will fix
the exchangerates.
16. / ( ) / Forward exchange rate is the riskiest type of exchange rate.
17. / ( ) / Total tariff imposed on an imported goods is the tariff policy.
18. / ( ) / One of the functions of exchange rate market is to transfer stocks and
bonds.
19. / ( ) / Floating exchange rate adopted by world countries in the late of
seventies.
20. / ( ) / Human resource theory proves the inhomogeneous of labor product.

Q3 – Answer the following questions.

1-What are the types of balance of payments disequilibrium .

2-What is the special drawing rights.

3-Define dumping policy and what are the kind of dumping.

4-What is exchange rate speculation.

5-What are the reasons for free and protection trade.

Q 4 - answer question 1 or 2

1-Explain the effects of export-import, inflation and demand for capital assets on exchange rates (use graphs).

2- Compare the effects of quota and tariffs (use graphs).

Q 5 : Define the balance of payment and explain its structure.

GOOD LUCK