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International Economics Practice Test
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International economics covers the effects upon economic activity from international differences in productive resources and consumer preferences and the international institutions that affect them.
International economics plays a crucial role in understanding and shaping the global economy. It helps explain the benefits and challenges of international trade, the effects of globalization on different economies, and the impact of economic policies on domestic and foreign markets.

International Economics Practice Test
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25 Questions

1. The current account of the U.S. balance of payments does not include:
2. What is the effect of a currency devaluation under fixed exchange rates in the short run?
3. ______________means the measures adopted for avoiding risks.
4. Which among the following best explains the difference between Trade in Invisibles and merchandise trade?
5. A major difference between the spot market and the forward market is that the spot market deals with:
6. Which of the following statements is correct?
7. Tariffs and quotas on imports tend to involve larger sacrifices in national welfare than would occur under domestic subsidies. This is because, unlike domestic subsidies, import tariffs and quotas:
8. Which balance-of-payments item does not directly enter into the calculation of the U.S.gross domestic product?
9. If the dollar depreciates, this likely will cause
10. The accounting system used in BOP
11. If { } > { } when K= capital and L= labour, Pk is price of capital and Pl is price of labour and A and B are countries then
12. Domestic content legislation applied to autos would tend to:
13. What would be the effects of an export subsidy on oil imposed by Russia?
14. The exchange rate system that is followed in India is
15. Reciprocal Demand Curve is another name for
16. Which of the following is true regarding the capital market development since the 1970s?
17. Credit (+) items in the balance of payments correspond to anything that:
18. A fall in the external value of a currency:
19. Which trade restriction stipulates the percentage of a product’s total value that must be produced domestically in order for that product to be sold domestically?
20. Protectionist trade policy is associated with
21. Which among the following sentence is NOT true
22. All of the following are credit items in the balance of payments, except:
23. What records a country's transactions (made by individuals, firms and government bodies.) with the rest of the world?
24. ............theory states that countries which are rich in labour will export labour intensive goods and countries which are rich in capital will export capital intensive goods
25. Theory of Absolute advantage is

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