12th Economics Monthly Test - 1 ( International Economics )

St. Britto Hr. Sec. School - Madurai

12th Economics Monthly Test - 1 ( International Economics )-Aug 2020

Time : 2.30 Hours

Part - A

Multiple Choice Question - Answer All Question

Find the incorrect one with respect to Indian rupee devaluation

On 29th September, 1949
On 6th June, 1966
On 1st July, 1991
On 9st August, 1990

Which of the following is not an another term used for Internal Trade?

‘domestic trade’
‘home trade’
‘external trade;
‘intra-regional trade’.

A country's _________ also determines the exchange rate.

Terms of trade
Trade
Policy issue
Internal trade

Which among the following are the major assumptions of Absolute advantage theory?

There are two countries and two commodities and one country has absolute advantage in one commodity and the second country has advantage in another commodity
Labour is the only factor of production and labour is homogeneous, that means each unit of labour produces same level of output. Value of a commodity is measured in terms of its labour content
Labour is perfectly mobile within the country but perfectly immobile between the countries. It means that workers are free to move between industries within the nation but migration to other countries is impossible.
All the above

Match the correct codes

1 The BoP is said to be balanced when the receipts (R) and payments (P) are just equal i R / P =1

2 When receipts exceed payments, the BoP is said to be favourable ii R / P > 1

3 When receipts are less than payments, the BoP is said to be unfavourable or adverse iii R / P < 1

4 BOP Disequilibrium iv R / P ≠1

(1) – (i) (2) – (ii) (3) – (iv) (4) – (iii)
(1) – (ii) (2) – (iii) (3) – (iv) (4) – (i)
(1) – (iv) (2) – (iii) (3) – (i) (4) – (ii)
(1) – (i) (2) – (ii) (3) – (iii) (4) – (iv)

International trade forces domestic firms to become more competitive in terms of

The introduction of new products
Product design and quality
Product price
All of the above

If a nation has an open economy it means that the nation

Allows private ownership of capital
Has flexible exchange rates
Has fixed exchange rates
Conducts trade with other countries

Net export equals _______.

Export x Import
Export + Import
Export - Import
Exports of services only

Exchange rate for currencies is determined by supply a!ld demand under the-system of

Fixed exchange rate
Flexible exchange rate
Constant
Government regulated

The modern theory of international trade explains the causes for …………….?

comparative cost difference
absolute cost difference
comparative cost similarities
absolute cost similarities

The Heckscher-Ohlin model rules out the classical model’s basis for trade by assuming that________ is (are) identical between countries

factor endowments
factor intensities
technology
opportunity costs

The opportunity cost of one DVD in India is

Country Tons of steel DVDs

China 80 40

India 20 20

One ton of steel
Two tons of steel
Three tons of steel
Four tons of steel

Exchange rates are determined in

money market
foreign exchange market
stock market
capital market

Favourable trade means value of exports are ________ Than that of imports.

More
Less
More or Less
Not more than

Japan has comparative cost in

steel
textiles
both of them
cannot be determined

Part - B

Generic 2 - Answer All Question

What is the main difference between Adam Smith and Ricardo with regard to the emergence of foreign trade?

Define International trade.

What is Flexible Exchange Rate?

What is Favourable BoP?

List different approaches of Classical Trade Theories

What is meant by Exchange Rate?

What are the other names of international trade?

State any two merits of trade.
What do you mean by Balance of Payments?

List the Types of Exchange Rates Exchange rates

Draw the chart depicting H-O Theorem

What do you mean by exchange control?

Mention the Import Control measures for Correction of Balance of payment Disequilibrium.

Write a short note on Automatic Correction.

What is International Economics?

What are the other names of internal trade?

Part - C

Generic 3 - Answer All Question

Explain the Net Barter Terms of Trade and Gross Barter Terms of Trade.

State the Correction of Balance of payment Disequilibrium - Trade Measures.

Write a brief note on flexible exchange rate.

List the “Role of a state” according to mercantilists?

Mention the difference between FDI and FII

Describe the subject matter of International Economics.

Distinguish between Balance of Trade and Balance of Payments.

Discuss the elements of Automatic Correction in trade disequilibrium.

General Utility Functions of RBI – Discuss.
State the objectives of Foreign Direct Investment.

What are the assumption of Modern theory international trade?

Part - D

Generic 5 - Answer All Question

Draw the flow chart for correction of Balance Payment Disequilibrium

Explain the determinants of Equilibrium Exchange Rate
Explain the relationship between Foreign Direct Investment and Economic development.

1	The BoP is said to be balanced when the receipts (R) and payments (P) are just equal	i	R / P =1
2	When receipts exceed payments, the BoP is said to be favourable	ii	R / P > 1
3	When receipts are less than payments, the BoP is said to be unfavourable or adverse	iii	R / P < 1
4	BOP Disequilibrium	iv	R / P ≠1

InstaQB

Institutions

12th Standard English Medium

12th Standard Tamil Medium

11th Standard English Medium

11th Standard Tamil Medium

10th Standard English Medium

9th Standard English Medium

8th Standard English Medium

7th Standard English Medium

Class XII

Class XI

12Th Standard

11Th Standard

10Th Standard

9Th Standard

12th Economics Monthly Test - 1 ( International Economics )

St. Britto Hr. Sec. School - Madurai

12th Economics Monthly Test - 1 ( International Economics )-Aug 2020

Part - A

Multiple Choice Question - Answer All Question

Find the incorrect one with respect to Indian rupee devaluation

Which of the following is not an another term used for Internal Trade?

A country's _________ also determines the exchange rate.

Which among the following are the major assumptions of Absolute advantage theory?

International trade forces domestic firms to become more competitive in terms of

If a nation has an open economy it means that the nation

Net export equals _______.

Exchange rate for currencies is determined by supply a!ld demand under the-system of

The modern theory of international trade explains the causes for …………….?

The Heckscher-Ohlin model rules out the classical model’s basis for trade by assuming that________ is (are) identical between countries

The opportunity cost of one DVD in India is Country Tons of steel DVDs China 80 40 India 20 20

Exchange rates are determined in

Favourable trade means value of exports are ________ Than that of imports.

Japan has comparative cost in

Part - B

Generic 2 - Answer All Question

What is the main difference between Adam Smith and Ricardo with regard to the emergence of foreign trade?

Define International trade.

What is Flexible Exchange Rate?

What is Favourable BoP?

List different approaches of Classical Trade Theories

What is meant by Exchange Rate?

What are the other names of international trade?

State any two merits of trade.

What do you mean by Balance of Payments?

List the Types of Exchange Rates Exchange rates

Draw the chart depicting H-O Theorem

What do you mean by exchange control?

Mention the Import Control measures for Correction of Balance of payment Disequilibrium.

Write a short note on Automatic Correction.

What is International Economics?

What are the other names of internal trade?

Part - C

Generic 3 - Answer All Question

Explain the Net Barter Terms of Trade and Gross Barter Terms of Trade.

State the Correction of Balance of payment Disequilibrium - Trade Measures.

Write a brief note on flexible exchange rate.

List the “Role of a state” according to mercantilists?

Mention the difference between FDI and FII

Describe the subject matter of International Economics.

Distinguish between Balance of Trade and Balance of Payments.

Discuss the elements of Automatic Correction in trade disequilibrium.

General Utility Functions of RBI – Discuss.

State the objectives of Foreign Direct Investment.

What are the assumption of Modern theory international trade?

Part - D

Generic 5 - Answer All Question

Draw the flow chart for correction of Balance Payment Disequilibrium

Explain the determinants of Equilibrium Exchange Rate

Explain the relationship between Foreign Direct Investment and Economic development.

Explain the causes for Balance of Payment Disequilibrium

How the Rate of Exchange is determined? Illustrate.

Discuss the differences between Internal Trade and International Trade.

Comment

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The opportunity cost of one DVD in India is

Country Tons of steel DVDs

China 80 40

India 20 20