12th Economics Monthly Test - 2 ( International Economics )

St. Britto Hr. Sec. School - Madurai

12th Economics Monthly Test - 2 ( International Economics )-Aug 2020

Time : 2.30 Hours

Part - A

Multiple Choice Question - Answer All Question

If the value of a country’s currency falls, what is the effect on exports and imports, assuming all else remains unchanged?

Exports will fall, and imports will rise
Exports and imports will both fall
Exports will rise, and imports will fall
Exports and imports will both rise

Find the incorrect representation. Net Barter Terms of TradeTn= (Px / Pm) x 100

Tn = Net Barter Terms of Trade
Px = Index number of export prices
Pm = Index number of import prices
Tn = Gross Barter Terms of Trade

Absolute Cost Advantage was developed by

Adam Smith
Ricardo
T.R.Hicks
Doltan

Exchange rates are determined in

money market
foreign exchange market
stock market
capital market

Components of balance of payments of a country includes

Current account
Official account
Capital account
All of above

Comparative advantage is determined by:

actual differences in labor productivity between countries.
relative differences in labor productivity between countries
both (a) and (b)
neither (a) nor (b)

_______ equals Export - Import

Gross Import
Gross Export
Net Import
Net Export

Match the correct codes

1 Monetary measures i Import Duties

2 Export Promotion ii Foreign Loans

3 Import Control iii Abolition / reduction of duties

4 Miscellaneous Measures iv Monetary Contraction / Expansion

(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)

The foreign exchange rate is NOT

The price of one currency expresses in terms of another.
Rate at which of one commodity expresses in terms of another
The value of one currency in terms of another
Fixed for ever

Match the correct codes

1 Tff i (Qm/Qx) x 100

2 Tn ii (Px / Pm) Fx

3 Tg iii (Px / Pm) x 100

4 Tf iv (Px / Pm) (Fx / Fm)

(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)

In general, a primary reason why nations conduct international trade is because

Some nations prefer to produce one thing while others produce another
Resources are not equally distributed among all trading nations
Trade enhances opportunities to accumulate profits
Interest rates are not identical in all trading nations

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

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

When there is a chronic imbalance in the trade balance (more imports than exports), it can theoretically be reduced by means of a package of tax measures

decrease of customs duties
increase of customs duties
stimulating imports.
stimulating exports

Which of the following is not an example of foreign direct investment?

the construction of a new auto assembly plant overseas
the acquisition of an existing steel mill overseas
the purchase of bonds or stock issued by a textile company overseas
the creation of a wholly owned business firm overseas

Part - B

Generic 2 - Answer All Question

Mention the dates of devaluation of Indian Rupee.

What is the significant difference between FDI and FII?

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

What are the Fixed Exchange Rates?

Define Terms of Trade.

What is Foreign Exchange?

How Modern theory of International Trade attributes international differences in comparative costs to?
Write the Balance of Payment (BOP) Account Chart

Part - C

Generic 3 - Answer All Question

Describe the subject matter of International Economics.

General Utility Functions of RBI – Discuss.

List the “Role of a state” according to mercantilists?
List out the limitations of Modern Theory of International Trade?

Mention the difference between FDI and FPI

Write a brief note on HO - Factor endowment model theorem

List the assumption of Comparative advantage theory of international trade.

What are import quotas?

Part - D

Generic 5 - Answer All Question

Explain briefly the Comparative Cost Theory.

Discuss the differences between Internal Trade and International Trade.

Explain the determinants of Equilibrium Exchange Rate
How the Rate of Exchange is determined? Illustrate.

Explain the any two types of Exchange Rates

Discuss the various types of disequilibrium in the balance of payments.

Comment

Add Comment

1	Monetary measures	i	Import Duties
2	Export Promotion	ii	Foreign Loans
3	Import Control	iii	Abolition / reduction of duties
4	Miscellaneous Measures	iv	Monetary Contraction / Expansion

1	Tff	i	(Qm/Qx) x 100
2	Tn	ii	(Px / Pm) Fx
3	Tg	iii	(Px / Pm) x 100
4	Tf	iv	(Px / Pm) (Fx / Fm)

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 - 2 ( International Economics )

St. Britto Hr. Sec. School - Madurai

12th Economics Monthly Test - 2 ( International Economics )-Aug 2020

Part - A

Multiple Choice Question - Answer All Question

If the value of a country’s currency falls, what is the effect on exports and imports, assuming all else remains unchanged?

Find the incorrect representation. Net Barter Terms of TradeTn= (Px / Pm) x 100

Absolute Cost Advantage was developed by

Exchange rates are determined in

Components of balance of payments of a country includes

Comparative advantage is determined by:

_______ equals Export - Import

Match the correct codes 1 Monetary measures i Import Duties 2 Export Promotion ii Foreign Loans 3 Import Control iii Abolition / reduction of duties 4 Miscellaneous Measures iv Monetary Contraction / Expansion

The foreign exchange rate is NOT

Match the correct codes 1 Tff i (Qm/Qx) x 100 2 Tn ii (Px / Pm) Fx 3 Tg iii (Px / Pm) x 100 4 Tf iv (Px / Pm) (Fx / Fm)

In general, a primary reason why nations conduct international trade is because

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

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

When there is a chronic imbalance in the trade balance (more imports than exports), it can theoretically be reduced by means of a package of tax measures

Which of the following is not an example of foreign direct investment?

Part - B

Generic 2 - Answer All Question

Mention the dates of devaluation of Indian Rupee.

What is the significant difference between FDI and FII?

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

What are the Fixed Exchange Rates?

Define Terms of Trade.

What is Foreign Exchange?

How Modern theory of International Trade attributes international differences in comparative costs to?

Write the Balance of Payment (BOP) Account Chart

Part - C

Generic 3 - Answer All Question

Describe the subject matter of International Economics.

General Utility Functions of RBI – Discuss.

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

List out the limitations of Modern Theory of International Trade?

Mention the difference between FDI and FPI

Write a brief note on HO - Factor endowment model theorem

List the assumption of Comparative advantage theory of international trade.

What are import quotas?

Part - D

Generic 5 - Answer All Question

Explain briefly the Comparative Cost Theory.

Discuss the differences between Internal Trade and International Trade.

Explain the determinants of Equilibrium Exchange Rate

How the Rate of Exchange is determined? Illustrate.

Explain the any two types of Exchange Rates

Discuss the various types of disequilibrium in the balance of payments.

Comment

Other Study material

12th Economics Weekly Test - 2 ( Environmental Eco

12th Economics Weekly Test - 1 ( Environmental Eco

12th Economics Monthly Test - 3 ( Introduction to

12th Economics Weekly Test - 5 ( Environmental Eco

12th Economics Weekly Test - 4 ( Environmental Ec

12th Economics Weekly Test - 3 ( Environmental Eco

12th Economics Monthly Test - 2 ( International Ec

12th Economics Monthly Test - 3 ( International Ec

12th Economics Weekly Test - 1 ( Fiscal Economics

12th Economics Weekly Test - 2 ( Fiscal Economics

12th Economics Weekly Test - 3 ( Fiscal Economics

12th Economics Weekly Test - 4 ( Fiscal Economics

12th Economics Weekly Test - 5 ( Fiscal Economics

12th Economics Monthly Test - 1 ( Fiscal Economics

Match the correct codes

1 Monetary measures i Import Duties

2 Export Promotion ii Foreign Loans

3 Import Control iii Abolition / reduction of duties

4 Miscellaneous Measures iv Monetary Contraction / Expansion

Match the correct codes

1 Tff i (Qm/Qx) x 100

2 Tn ii (Px / Pm) Fx

3 Tg iii (Px / Pm) x 100

4 Tf iv (Px / Pm) (Fx / Fm)