Question 1

Which of the following is true of the euro since its establishment in 1999?

Accepted Answer

A)  The value of the euro has been stable against the U.S. dollar.
B)  The euro's value has steadily appreciated against the U.S. dollar.
C)  The euro's value initially appreciated and then steadily depreciated against the U.S. dollar.
D)  The euro has had a volatile trading history against the U.S. dollar.
E)  The value of the euro has been constant when compared to the U.S. dollar.F) C) and E)
G) B) and E)

Question 2

Which of the following proposed that all impediments to the formation of a single market be eliminated by December 31, 1992, resulting in the Single European Act?

Accepted Answer

A)  Delors Commission
B)  Andean Pact
C)  Treaty of Rome
D)  North American Free Trade Agreement
E)  Maastricht TreatyF) A) and B)
G) B) and E)

Question 3

Which of the following are the most popular form of regional economic integration, accounting for almost 90 percent of regional agreements?

Accepted Answer

A)  Licensing agreements
B)  Economic unions
C)  Common markets
D)  Free trade agreements
E)  Political unionsF) C) and E)
G) A) and E)

Question 4

The European Community was established with the signing in 1957 of the Treaty of:

Accepted Answer

A)  Paris.
B)  Brussels.
C)  Switzerland.
D)  Rome.
E)  Lisbon.F) B) and C)
G) B) and E)

Question 5

Which of the following supports the economic case for regional economic integration?

Accepted Answer

A)  International institutions such as the World Trade Organization have been moving the world away from a free trade regime.
B)  The greater the number of countries involved in a free trade agreement, the fewer the perspectives that must be reconciled.
C)  Coordination and policy harmonization problems are largely a function of the number of countries that seek agreement.
D)  It is difficult to establish a free trade and investment regime among a limited number of adjacent countries as compared to the world community.
E)  Since most governments do not intervene, unrestricted free trade and FDI have become a reality.F) B) and E)
G) None of the above

Question 6

Similarities in the underlying structure of economic activity make it feasible to adopt a single currency and use a single exchange rate as an instrument of macroeconomic policy in a(n) :

Accepted Answer

A)  managed currency zone.
B)  open exchange regime.
C)  optimal currency area.
D)  free trade area.
E)  advanced monetary zone.F) B) and E)
G) A) and E)

Question 7

Which of the following countries has adopted the euro as its currency?

Accepted Answer

A)  Great Britain
B)  France
C)  Denmark
D)  Sweden
E)  SwitzerlandF) None of the above
G) A) and B)

Question 8

A regional free trade agreement will benefit the world only if:

Accepted Answer

A)  it raises the standard of living in one of the member countries.
B)  the amount of trade it creates exceeds the amount it diverts.
C)  the currencies of the nations involved appreciate.
D)  the balance-of-trade situation remains stable in the region.
E)  it creates trade surplus for one of the countries involved.F) A) and B)
G) D) and E)

Question 9

The European Parliament is responsible for proposing European Union (EU) legislation, implementing it, and monitoring compliance with EU laws by member-states.

Accepted Answer

A) True 
 B)False

Question 10

Three countries enter into an agreement to remove all tariffs and trade barriers between them. They decide on a common trade policy with regard to nonmembers. Faced with political backlash, the countries stop short of allowing mobility of factors of production such as labor and capital. Which of the following levels of economic integration best describes this arrangement?

Accepted Answer

A)  Political union
B)  Customs union
C)  Common market
D)  Economic union
E)  Monetary unionF) D) and E)
G) A) and B)

Question 11

Which of the following refers to a trade pact among Costa Rica, El Salvador, Guatemala, Honduras, and Nicaragua, which began in the early 1960s but collapsed in 1969 due to war?

Accepted Answer

A)  Central American Common Market
B)  Free Trade Area of the Americas
C)  Caribbean Single Market and Economy
D)  Mercosur
E)  CARICOMF) B) and C)
G) None of the above

Question 12

In terms of regional economic integration, linking neighboring economies and making them increasingly dependent on each other create incentives for political cooperation between the neighboring states.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following is the economic level corresponding to the least integration?

Accepted Answer

A)  A free trade area
B)  A customs union
C)  A common market
D)  An economic union
E)  A political unionF) A) and C)
G) A) and E)

Question 14

Which of the following is an expected consequence of the implementation of the North American Free Trade Agreement?

Accepted Answer

A)  Low-skilled jobs will be moved out to Mexico resulting in lowering of average wage rates in the United States and Canada.
B)  Increased imports from Mexico will help reduce the huge trade deficit for United States and Canada.
C)  Lower incomes of the Mexicans would allow them to import fewer U.S. and Canadian goods, thereby decreasing demand.
D)  A large number of Mexican firms will hire low-skilled workers from the United States.
E)  Some U.S. and Canadian firms would move production to Mexico to take advantage of lower labor costs.F) C) and D)
G) A) and E)

Question 15

Economic theories suggest that free trade and investment is a positive-sum game, in which all participating countries stand to gain.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following is a significant impact of the North American Free Trade Agreement (NAFTA) ?

Accepted Answer

A)  It led to decreased economic stability in Canada.
B)  It led to a major trade deficit for Canada.
C)  It helped create the background for increased political stability in Mexico.
D)  It led to a trade surplus for all the three member nations.
E)  It led to a reduction in purchasing power of consumers in America.F) A) and C)
G) All of the above

Question 17

A political union addresses the issue of how to make a coordinating bureaucracy accountable to the citizens of member nations of an economic union.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following is true of the Single European Act?

Accepted Answer

A)  It proposed to place frontier controls among European Community countries.
B)  It sought to abolish the application of the principle of "mutual recognition" to product standards.
C)  It proposed to reduce costs indirectly by preventing national suppliers to compete.
D)  It provided the impetus for the restructuring of substantial sections of European industry.
E)  It proposed to reduce costs directly by preventing lower-cost suppliers into national economies.F) D) and E)
G) C) and E)

Question 19

Over time the euro will impact the pan-European capital market by leading to:

Accepted Answer

A)  an increase in the cost of capital.
B)  a decline in the overall level of savings and investment.
C)  an increased efficiency with which investment funds are allocated.
D)  reduced liquidity in the market.
E)  reduced competition among European producers.F) A) and C)
G) C) and D)

Question 20

A common market has no barriers to trade among member countries, includes a common external trade policy, and allows factors of production to move freely among members.

Accepted Answer

A) True 
 B)False

Exam 9: Regional Economic Integration

A political union addresses the issue of how to make a coordinating bureaucracy accountable to the citizens of member nations of an economic union.

Correct Answer
verified

Which of the following is true of the Single European Act?

Correct Answer
verified

Over time the euro will impact the pan-European capital market by leading to:

Correct Answer
verified

A regional free trade agreement will benefit the world only if:

Correct Answer
verified

Correct Answer
verified

Which of the following is true of the euro since its establishment in 1999?

Correct Answer
verified

In terms of regional economic integration, linking neighboring economies and making them increasingly dependent on each other create incentives for political cooperation between the neighboring states.

Correct Answer
verified

A common market has no barriers to trade among member countries, includes a common external trade policy, and allows factors of production to move freely among members.

Correct Answer
verified

Which of the following supports the economic case for regional economic integration?

Correct Answer
verified

Which of the following countries has adopted the euro as its currency?

Correct Answer
verified

Which of the following is an expected consequence of the implementation of the North American Free Trade Agreement?

Correct Answer
verified

Which of the following is the economic level corresponding to the least integration?

Correct Answer
verified

The European Community was established with the signing in 1957 of the Treaty of:

Correct Answer
verified

Which of the following refers to a trade pact among Costa Rica, El Salvador, Guatemala, Honduras, and Nicaragua, which began in the early 1960s but collapsed in 1969 due to war?

Correct Answer
verified

Which of the following are the most popular form of regional economic integration, accounting for almost 90 percent of regional agreements?

Correct Answer
verified

Which of the following proposed that all impediments to the formation of a single market be eliminated by December 31, 1992, resulting in the Single European Act?

Correct Answer
verified

The European Parliament is responsible for proposing European Union (EU) legislation, implementing it, and monitoring compliance with EU laws by member-states.

Correct Answer
verified

Similarities in the underlying structure of economic activity make it feasible to adopt a single currency and use a single exchange rate as an instrument of macroeconomic policy in a(n) :

Correct Answer
verified

Economic theories suggest that free trade and investment is a positive-sum game, in which all participating countries stand to gain.

Correct Answer
verified

Which of the following is a significant impact of the North American Free Trade Agreement (NAFTA) ?

Correct Answer
verified

Exam 9: Regional Economic Integration

A political union addresses the issue of how to make a coordinating bureaucracy accountable to the citizens of member nations of an economic union.

Correct AnswerverifiedShow Answer

Which of the following is true of the Single European Act?

Correct AnswerverifiedShow Answer

Over time the euro will impact the pan-European capital market by leading to:

Correct AnswerverifiedShow Answer

A regional free trade agreement will benefit the world only if:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following is true of the euro since its establishment in 1999?

Correct AnswerverifiedShow Answer

In terms of regional economic integration, linking neighboring economies and making them increasingly dependent on each other create incentives for political cooperation between the neighboring states.

Correct AnswerverifiedShow Answer

A common market has no barriers to trade among member countries, includes a common external trade policy, and allows factors of production to move freely among members.

Correct AnswerverifiedShow Answer

Which of the following supports the economic case for regional economic integration?

Correct AnswerverifiedShow Answer

Which of the following countries has adopted the euro as its currency?

Correct AnswerverifiedShow Answer

Which of the following is an expected consequence of the implementation of the North American Free Trade Agreement?

Correct AnswerverifiedShow Answer

Which of the following is the economic level corresponding to the least integration?

Correct AnswerverifiedShow Answer

The European Community was established with the signing in 1957 of the Treaty of:

Correct AnswerverifiedShow Answer

Which of the following refers to a trade pact among Costa Rica, El Salvador, Guatemala, Honduras, and Nicaragua, which began in the early 1960s but collapsed in 1969 due to war?

Correct AnswerverifiedShow Answer

Which of the following are the most popular form of regional economic integration, accounting for almost 90 percent of regional agreements?

Correct AnswerverifiedShow Answer

Which of the following proposed that all impediments to the formation of a single market be eliminated by December 31, 1992, resulting in the Single European Act?

Correct AnswerverifiedShow Answer

The European Parliament is responsible for proposing European Union (EU) legislation, implementing it, and monitoring compliance with EU laws by member-states.

Correct AnswerverifiedShow Answer

Similarities in the underlying structure of economic activity make it feasible to adopt a single currency and use a single exchange rate as an instrument of macroeconomic policy in a(n) :

Correct AnswerverifiedShow Answer

Economic theories suggest that free trade and investment is a positive-sum game, in which all participating countries stand to gain.

Correct AnswerverifiedShow Answer

Which of the following is a significant impact of the North American Free Trade Agreement (NAFTA) ?

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified