Question 1

Once the barriers to trade and investment are removed, companies are able to realize cost economies by centralizing production in key locations and producing a standardized product for a single multiple-country market.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following is true of ASEAN?

Accepted Answer

A)   China, India, South Korea, and Singapore are among its members.
B)   Collectively, the member states account for about 55 percent of world trade.
C)   It is slowly progressing toward establishing a free trade zone.
D)   It has been successful in fulfilling its basic objective of fostering freer trade between member countries.

Question 3

What is the political case for integration? How did political arguments influence the establishment of the European Union?

Accepted Answer

Linking neighboring economies and making...

Question 4

Explain the North American Free Trade Agreement and then debate its ratification.

Accepted Answer

NAFTA is a free trade agreement between ...

Question 5

Discuss the trend toward increased regional economic integration.

Accepted Answer

In recent years, there has been a strong...

Question 6

Which feature of a customs union differentiates it from a free trade area?

Accepted Answer

A)   harmonization of members' tax rates
B)   a common currency
C)   a common external trade policy toward nonmembers
D)   ability of factors of production to move freely between members

Question 7

Which of the following observations is true of the euro?

Accepted Answer

A)   It is used by all member states of the European Union.
B)   While recommended, it is not required that participating countries give up their own currencies.
C)   It required participating countries to give up control over monetary policy.
D)   By adopting it, the EU created the most widely traded currency in the world.

Question 8

Why is the European Council said to be the ultimate controlling authority within the EU?

Accepted Answer

A)   It is responsible for implementing EU legislation and monitoring compliance with EU laws by member states.
B)   Its role in setting competition policy is becoming increasingly important to business.
C)   It has the right to vote on the appointment of commissioners.
D)   Draft legislation from the commission can become EU law only if the council agrees.

Question 9

Describe the state of economic integration in Africa. What factors have hindered the process?

Accepted Answer

There have been efforts to establish a t...

Question 10

Country X and Country Y reach an agreement to boost bilateral trade. They agree to remove all barriers to the trade of goods and services. They, however, are free to determine their own trade policies with regard to nonmembers. Which level of economic integration is this an example of?

Accepted Answer

A)   a customs union
B)   an economic union
C)   a common market
D)   a free trade area

Question 11

Which of the following is a reason Turkey is not yet a member of the EU?

Accepted Answer

A)   Only about 10 percent of Turkey's international trade is with the EU.
B)   There are concerns over human rights issues in the country.
C)   The country has yet to form a customs union with the EU.
D)   Turkey has a weak economy.

Question 12

The most recent attempt to reenergize the free trade movement in Africa occurred in early 2001, when ________, Uganda, and Tanzania, member states of the East African Community (EAC) , committed themselves to relaunching their bloc, 24 years after it collapsed.

Accepted Answer

A)   Sudan
B)   Ethiopia
C)   Kenya
D)   Somalia

Question 13

The ultimate controlling unit within the EU is the

Accepted Answer

A)   European Commission.
B)   European Parliament.
C)   Court of Justice.
D)   Council of the European Union.

Question 14

A regional free trade agreement will benefit the world only when the amount of trade it creates exceeds the amount of trade it diverts.

Accepted Answer

A) True 
 B)False

Question 15

The ________ is primarily a consultative rather than legislative body.

Accepted Answer

A)   European Parliament
B)   Court of Justice
C)   Council of the European Union
D)   European Commission

Question 16

The European Union is an example of a perfect economic union.

Accepted Answer

A) True 
 B)False

Question 17

The judges of the European Court of Justice are required to act as representatives of national interests, rather than as independent officials.

Accepted Answer

A) True 
 B)False

Question 18

Compare and contrast a free trade area and a common market. Provide examples.

Accepted Answer

All barriers to the trade of goods and s...

Question 19

Linking neighboring countries economically and making them interdependent

Accepted Answer

A)   increases the potential for violent conflict.
B)   creates increased political tensions.
C)   leads to dilution of cultures.
D)   creates incentives to increase political cooperation as well.

Question 20

Which of the following is a concern of some economists regarding regional integration?

Accepted Answer

A)   The benefits of regional integration are determined by the extent of trade diversion.
B)   The benefits of regional integration may have been oversold, while the costs have been ignored.
C)   A regional free trade agreement will benefit the world only if the amount of trade it diverts exceeds the amount it creates.
D)   The costs of regional integration will be exceedingly high with little chance that the benefits will outweigh the costs.

Exam 9: Regional Economic Integration

A regional free trade agreement will benefit the world only when the amount of trade it creates exceeds the amount of trade it diverts.

Correct AnswerverifiedShow Answer

Discuss the trend toward increased regional economic integration.

Correct AnswerverifiedIn recent years, there has been a strong...View AnswerShow Answer

The ultimate controlling unit within the EU is the

Correct AnswerverifiedShow Answer

The European Union is an example of a perfect economic union.

Correct AnswerverifiedShow Answer

Which of the following observations is true of the euro?

Correct AnswerverifiedShow Answer

Compare and contrast a free trade area and a common market. Provide examples.

Correct AnswerverifiedAll barriers to the trade of goods and s...View AnswerShow Answer

Country X and Country Y reach an agreement to boost bilateral trade. They agree to remove all barriers to the trade of goods and services. They, however, are free to determine their own trade policies with regard to nonmembers. Which level of economic integration is this an example of?

Correct AnswerverifiedShow Answer

Once the barriers to trade and investment are removed, companies are able to realize cost economies by centralizing production in key locations and producing a standardized product for a single multiple-country market.

Correct AnswerverifiedShow Answer

Which of the following is a concern of some economists regarding regional integration?

Correct AnswerverifiedShow Answer

Linking neighboring countries economically and making them interdependent

Correct AnswerverifiedShow Answer

Which of the following is true of ASEAN?

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The judges of the European Court of Justice are required to act as representatives of national interests, rather than as independent officials.

Correct AnswerverifiedShow Answer

What is the political case for integration? How did political arguments influence the establishment of the European Union?

Correct AnswerverifiedLinking neighboring economies and making...View AnswerShow Answer

Explain the North American Free Trade Agreement and then debate its ratification.

Correct AnswerverifiedNAFTA is a free trade agreement between ...View AnswerShow Answer

Describe the state of economic integration in Africa. What factors have hindered the process?

Correct AnswerverifiedThere have been efforts to establish a t...View AnswerShow Answer

Which feature of a customs union differentiates it from a free trade area?

Correct AnswerverifiedShow Answer

The most recent attempt to reenergize the free trade movement in Africa occurred in early 2001, when ________, Uganda, and Tanzania, member states of the East African Community (EAC) , committed themselves to relaunching their bloc, 24 years after it collapsed.

Correct AnswerverifiedShow Answer

Why is the European Council said to be the ultimate controlling authority within the EU?

Correct AnswerverifiedShow Answer

Which of the following is a reason Turkey is not yet a member of the EU?

Correct AnswerverifiedShow Answer

The ________ is primarily a consultative rather than legislative body.

Correct AnswerverifiedShow Answer

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In recent years, there has been a strong...
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All barriers to the trade of goods and s...
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Linking neighboring economies and making...
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NAFTA is a free trade agreement between ...
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There have been efforts to establish a t...
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