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CHAPTER 7 TRADE REGULATIONS AND INDUSTRIAL POLICIES MULTIPLE-CHOICE QUESTIONS 1. The World Trade Organization was established by the __________ of multilateral trade negotiations. a. Kennedy Round b. Tokyo Round c. Uruguay Round d. Clinton Round 2. Under U.S. commercial policy, the escape clause results in: a. Temporary quotas granted to firms injured by import competition b. Tariffs that offset export subsidies granted to foreign producers c. Tax advantages extended to minority-owned exporting firms d. Duties which offset commercial dumping on the part of foreign firms 3. Adjustment assistance is sometimes used to assist: a. In retraining workers displaced by imports b. In retraining workers displaced by exports c. Foreign firms injured by our quotas d. Foreign firms injured by our tariffs 4. The Export-Import Bank of the United States encourages American firms to sell overseas by providing direct loans and loan guarantees to foreign purchasers of American goods. To American firms, this represents a (an): a. Specific subsidy b. Ad valorem subsidy c. Domestic subsidy d. Export subsidy 122
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123 Test Bank for International Economics, 9e 5. The Smoot-Hawley Tariff Act of 1930 has generally been associated with: a. Falling tariffs b. Increases in the volume of trade c. Intensifying the worldwide depression d. Efforts to liberalize nontariff trade barriers 6. A trade policy designed to alleviate some domestic economic problem by exporting it to foreign countries is known as a (an): a. International dumping policy b. Trade adjustment assistance policy c. Most-favored-nation policy d. Beggar-thy-neighbor policy 7. Under U.S. commercial policy, which clause permits the modification of a trade liberalization agreement on a temporary basis if serious injury occurs to domestic producers as a result of the agreement? a. Adjustment assistance clause b. Escape clause c. Most-favored-nation clause d. Reciprocal-trade clause 8. Which policy reflects the notion that if society enjoys gains due to increased efficiency stemming from trade liberalization, some sort of compensation should be provided to those who are temporarily hurt by import competition? a. Countervailing duties b. Trade adjustment assistance c. Domestic subsidies d. Most-favored-nation standard 9. The Uruguay Round of Multilateral Trade Negotiations accomplished all of the following except : a. Placed primary emphasis on nontariff trade barriers b. Is estimated to yield modest gains in world output and employment c. Achieved cuts in tariffs but not in nontariff trade barriers d. Abolished all barriers to trade in agricultural products 10. The General Agreement on Tariffs and Trade and its successor, the World Trade Organization, have resulted in: a. Termination of export subsidies applied to manufactured goods b. Termination of import tariffs applied to manufactured goods c. Encouragement of beggar-thy-neighbor policies d. Reductions in trade barriers via multilateral negotiations 11. For the United States, which organization makes loans to foreign buyers of U.S. manufactured goods?
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This note was uploaded on 07/10/2008 for the course ECON 351 taught by Professor Santiago during the Fall '06 term at Wisconsin Milwaukee.

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