International Trade MCQ with answers

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In this blog post, I have published International Trade MCQ with answers. This post (set 2) contains 30 MCQs.

Set 1: International Business MCQ with answers

Set 2: International Trade MCQ with answers

1. ________is the number by which the change in investment must be multiplied in order to determine the resulting changes in total income. 



Marginal propensity to consume  

Marginal propensity to save 

2. Which among the following is not an objective of commercial policy? 

Increase the quality of trade with foreign nations 

Control the money supply in the economy 

Stabilizing the foreign trade 

Encouraging the development and protection of domestic Industries. 

3. If the MPC of a country is 0.75, Find the multiplier 


4. Which among the following is not a measure to raise the propensity to consume? 

Development of the means of transport 

Increased wages 

Credit Facilities 

Positive attitude towards saving 

5. The Leontief paradox stated that 

USA’s exports were labor-intensive, and imports were capital intensive 

USA’s exports and imports both were capital intensive 

USA’s exports and imports both were labor-intensive 

USA’s exports were capital intensive and imports were labor-intensive 

6. Government policies or measures that restrict trade without imposing a direct duty is known as_______ 

Tariff Barriers 

Non-Tariff barriers 

Trade Barriers 


7. When the export price of a product imported into India is less than the nominal value of ‘same articles’ sold in the domestic market of the exporter, _______ duty is usually imposed 

Safeguard duty 

Anti- Dumping duty 

Countervailing Duty 

Basic custom duty 

8. Which is the situation found during the peak phase of the business cycle? 

Falling of Investment 

Fall in Employment 

Increases in Inflation 

Falling stock prices 

9. In International trade which of the following is a non-tariff trade barrier? 


Export duties 

Anti-dumping tax 

Ad valorem duty 

10. Duty levied on the value of goods imported is referred to as_______ 

Ad valorem duty 

Compound duty 

Specific duty 

Import duty 

11. McDonald’s faced backlash due to an Ad in which they showed a man kneeling before McDonald’s vendor and begging to accept his expired coupon because begging is considered a shameful act by Chinese people. Which factor the did company fail to understand well? 





12. _______is a framework that can help marketers assess whether the macroeconomic factors are affecting an organization. 

SWOT Analysis 

PESTEL Analysis. 

Five Forces Model 

Ansoff Matrix 

13. ______ is a term referring to the process by which elements of different cultures are blended together to create a new culture. 





14. If a person is reading a novel at the same time attending phone calls and also drinking tea, he is having a _______ culture. 





15. The study of how we communicate with the distance between the sender and the receiver of the message in an oral communication is known as_____. 





16. Which cannot be included as the fundamental elements of democratic political system. 

Free and Fair elections regularly. 

Freedom of opinion to press. 

Majorities rights should only be considered 

Fair and independent court system. 

17. When the religious leaders take up and leads the executive, legislative, and judicial powers of a nation, we call it ____. 

Secular totalitarianism 

Theocratic totalitarianism 



18. The implementation of new rule by the current government or newly elected government is a ______ type of political risk. 





19. If the government seizing the International company’s assets and makes some reimbursement for the same, it is called_____. 





20. The political risk faced by a firm can be managed by_____. 

following ethical business practices. 

partnership with local firms. 


None of the above 

21. ___________represents the total value of goods and services produced by the residents of a country during a financial year. 



National Income 


22. Which among the following is not an indicator of the Human Development Index? 

Sex Ratio 

Per Capita Income 

Life Expectancy 


23. Which component of the economy results from faster growth of aggregate demand compared to aggregate supply? 





24. Sri Lanka is a pearl-shaped island nation in South Asia; imagine the country is going through a catastrophic situation due to tsunami, which among the following will be valid in respect to the above-mentioned situation; 

The price level is increasing due to supply disruption 

The price level is falling due to supply disruption 

No change in the price level as supply disrupted 

Demand will have no influence on supply due to the tsunami 

25. What will happen if a nation begins to print more currency and distribute it to people as the prices of everything are increasing day by day, and they are not able to meet their needs. 

Country will run smoothly as people are getting enough money to spend 

Country’s currency will get devaluation, and the economy will collapse 

will have no impact on the economy 

Economy will slightly move towards deflation 

26. ________ index is to measure the degree of economic distress due to the risk of (or actual) joblessness combined with an increasing cost of living. 

Human Development Index 

Physical Quality Life Index 

Misery Index 

Happiness Index 

27. Gini index is a commonly used measurement to measure___________ 

Education level of people in the country 

Inequality in the distribution of income or wealth 

Money supply in the economy 

GDP of the nation 

28. A student is doubtful regarding which type of economy he is living in. He feels there is high literacy, less corruption, and a high average income per person. Which index will help him to clarify his doubt? 

Human Development Index 

Economic Freedom Index 

Gini Index 

Sustainable Society Index 

29. KFC ensures that their customers get a similar experience in every location in terms of quality, taste, and ambiance. They try to attain it through___________. 


Joint Venture 

Management Contracts 


30. Which of the following cannot be considered as a mode of international technology transfer? 


Joint Ventures 



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