Statement A: The might of a country consists of gaining surpluses of gold and silver Statement B: A nation’s strength is found in economic independence and the maintenance of a favorable balance of trade Statement C: We need to gain colonies both as sources for raw materials and as markets for our manufactured of goods Which economic system is being described by these statements ?

Related Mcqs:

1. Starting from a position where the nation’s money demand equals the money supply and its balance of payments is in equilibrium economic theory suggests that the nation’s balance of payments would move into a surplus position if there occurred in the nation a (an) ?

   A. increase in the money demand
   B. decrease in the money demand
   C. increase in the money demand
   D. None of the above

2. According to the trade theory of Staffan Linder trade tends to be most pronounced in manufactured goods when trading countries have ?

   A. similar endowments of natural resources
   B. similar levels of technology
   C. similar per-capita incomes
   D. similar wage levels

3. Developing countries that emphasize the production of raw materials or agricultural goods may realize a long-run deterioration in the international terms of trade because of ?

   A. relatively low import tariffs maintained by advanced countries
   B. highly elastic demand for these products in advanced countries
   C. declines in the supplies of these products on world markets
   D. sluggish demand for these products in advanced countries

4. Starting from a position where the nation’s money demand equals the money supply and its balance of payments is in equilibrium its balance of payments would move into a surplus position if there occurred in the nation a (an) ?

   A. decrease in the money supply
   B. increase in the money supply
   C. decrease in the money demand
   D. None of the above

5. Developing countries that concentrate production in agricultural products or raw materials may face a long-run decline in their international terms of trade because of ?

   A. inelastic demand for these products in advanced countries
   B. large increases in the supplies of these products on world markets because of export expansion policies
   C. sluggish demand for these products in advanced countries
   D. All of the above

6. The theory of overlapping demand predicts that trade in manufactured goods is unimportant for countries with very different ?

   A. Tastes and preferences
   B. Expectations of future interest rate levels
   C. Per-capita income levels
   D. Labor productivities

7. Economic theory predicts that a currency depreciation will least lead to an improvement in the home country’s trade balance when ?

   A. home demand for imports is inelastic and foreign export demand is inelastic
   B. home demand for imports is elastic and foreign export demand is inelastic
   C. home demand for imports is inelastic and foreign export demand is elastic
   D. home demand for imports is elastic and foreign export demand is elastic

8. A country can still gain from trading certain goods even though its trading partners can produce those goods more cheaply. How is known this principle ?

   A. Relative Advantage
   B. Complete Advantage
   C. Comparative Edge
   D. Comparative Advantage

9. A country can still gain from trading certain goods even though its trading partners can produce those goods more cheaply. How is known this principle?

   A. Relative Advantage
   B. Complete Advantage
   C. Comparative Edge
   D. Comparative Advantage

10. Which approach predicts that is an economy operates a full employment and faces trade deficit currency devaluation will improve the trade balance only if domestic spending is cut thus freeing resources to produce exports ?

    A. the absorption approaches
    B. the Marshall Lerner approach
    C. the monetary approach
    D. the elasticities approach