17. dumping occurs when, in a foreign market, a good is sold: a. at a discount b
ID: 1209814 • Letter: 1
Question
17. dumping occurs when, in a foreign market, a good is sold:
a. at a discount below the list price
b.below its nominal price
c.below its cost of product or below the price in that market
d.at a price above the equilibrium price
19. the maximum amount of a good that may be imported during a specific period of time is:
a. an infant industry agreement
b.dumping
c.an import quota
d.comparative advantage
20. the world trade organization:
a. increases world trade by providing interest rate subsidies to foreign borrowers who buy US exports on credit
b.was established to resolve disputes arising under world trade rules
c.is another name for the IMF
d.was established to settle trade disputes within the European Union
21. to avoid tarriffs, a japanese firm moves ir final assembly line to Mexico and then ships the final products to canada. this is an exmaple of:
a. trade diversion
b.trade deflection
c.protectionism
d.rules of origin
23.current account transactions are all payment that are related to the purchase or sale of:
a.goods only
b.services only
c.good and services only
d.goods and services excluding government purchases
28. if the foreign exchange rate is 70 cents for one swiss franc, then:
a. a house that costs 100,000 francs will cost over $700,000
b.a car that costs 40,000 francs will cost $7,143
c.a clock that costs 500 francs will cost $350
d.a wine that costs 200 francs will cost $14
Explanation / Answer
17. b.below its nominal price
Dumping occurs that firm sell the same good at higher price in domestic country while at lower price in foreign countries.
19. c.an import quota
Import quota limits the quantity of good that a country can import at a period of time.
20. b.was established to resolve disputes arising under world trade rules
21. b.trade deflection
23. c.good and services only
28. c.a clock that costs 500 francs will cost $350
As in the given question, 1 franc = $ 0.7
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