Trade creation will more likely outweigh trade diversion for Country X that forms a customs union if the level of tariffs in Country X prior to the customs union is ________ and the total number of countries forming the customs union is _________?

Related Mcqs:

1. If A forms a customs union with C, the value of trade diversion will be ?

   A. $0
   B. $10,000
   C. $20,000
   D. $40,000

2. When several countries jointly impose common external tariffs, eliminate tariffs on each other, and eliminate barriers to the movement of labor and capital among themselves, they have formed a/na ?

   A. free trade area
   B. customs union
   C. common market
   D. economic union

3. Trade diversion takes place when ?

   A. a country moves from autarky to free trade
   B. a movement to a customs union reduces the costs of trade through standardization economic integration results in a
   C. economic integration results in a movement in product origin to a lower cost member country
   D. economic integration results in a shift in product origin from a lower-cost, nonmember country to a member country having higher costs

4. When free trade areas are set up the member countries trade with each other grows faster than their trade with other countries This is due to what economist call ?

   A. trade diversion
   B. trade channeling
   C. trade creation and trade diversion
   D. trade creation

5. If a group of countries abolish trade barriers between them and set same tariffs on goods coming in from other countries they are a ?

   A. common market
   B. free trade area
   C. customs union
   D. federation

6. If A forms a customs union with B, A will import ?

   A. 400 units from B
   B. 200 units from C
   C. 200 units from each
   D. 400 units from B and 200 units from C

7. When did World Trade Organization replace General Agreement on Tariffs and Trade (GATT)?

   A. 1st January 1995
   B. 1st January 1998
   C. 1st December 1999
   D. 1st June 2000

   Submitted by: Syed Nizakat Ali Shah

8. Concerning import tariffs of the United States empirical studies tend to conclude that these tariffs are ?

   A. Progressive and thus bear down on the wealthy
   B. regressive and thus bear down on the poor
   C. proportional and thus bear down on all consumers in the same manner
   D. deflationary and thus result in reductions in the price of imports

9. When imports from a higher-cost supplier within a customs union replace imports from a lower-cost supplier outside the custom union, there exists ?

   A. trade creation
   B. trade diversion
   C. dynamic welfare effects
   D. comprehensive welfare effects

10. What is called a group of countries that have removed all tariffs, quotas, and export subsidies on trade among themselves ?

    A. Close-trade zone
    B. Free trade zone
    C. Both of them
    D. None of them