Question

An example of a regional trading agreement is the ________.

Asia Pacific Economic Cooperation (APEC)

WTO

GATT

35.

Overall, free trade results in ________.

a decrease in price and a decrease in quantity

a decrease in price and an increase in quantity

an increase in price and an decrease in quantity

36.

What makes a regional trading agreement so significant to the countries involved within the agreement parameters?

It might dampen the free market forces within countries external to the agreement.

It may cause the countries not involved to stop importing goods with the countries involved in an agreement.

It can eliminate barriers to the mobility of goods, labor, and capital across the countries involved in the agreement.

38.

Protectionist policies are used by governments in order to ________.

Increase political power

protect their culture

lower incomes of producers

Answer 1

Question 34

Regional trade agreement implies trade agreement between countries belonging to same region.

APEC is regional trade agreement between 21 nations of pacific rim.

Hence, the correct answer is the option (1) [Asia Pacific Economic Cooperation (APEC)].

Question 35

Free trade enlarges market and provides economies of scale.

These results in a decrease in price and increase in quantity.

Hence, the correct answer is the option (2) [A decrease in price and an increase in quantity].

Question 36

The regional trade agreement brings immense benefits to the nations involved.

These agreements dismantle trade barriers and create gains from trade.

Hence, the correct answer is the option (3) [It can eliminate barriers to the mobility of goods, labor, and capital across the countries involved in the agreement].

Question 38

Protectionist policies are generally used by the governments to address their domestic constituencies.

These acts enhance political power of incumbent government.

Hence, the correct answer is the option (1) [Increase political power].