International Economics Test Questions and Answers
7 views 0 purchase
Course
International Economics
Institution
International Economics
International Economics Test Questions and Answers
infant industry argument - Answer-The argument that new industries should be protected from foreign competition until they are large enough to achieve economies of scale that will allow them to be competitive.
international reserves - Answer-F...
international economics test questions and answers
Written for
International Economics
International Economics
Seller
Follow
Perfectscorer
Reviews received
Content preview
International Economics Test Questions
and Answers
infant industry argument - Answer-The argument that new industries should be
protected from foreign competition until they are large enough to achieve economies of
scale that will allow them to be competitive.
international reserves - Answer-Foreign currencies held by governments (central banks)
as a result of international trade. Reserves may be held so that the government may
maintain a desired exchange rate for the country's currencies.
J-curve - Answer-Suggests that in the short term, a fall in the value of the currency will
lead to a worsening of the current account deficit, before things improve in the long
term.
Marshall-Lerner condition - Answer-States that a depreciation, or devaluation, of a
currency will only lead to an improvement in the current account balance if the elasticity
of demand for exports plus the elasticity of demand for imports is greater than one.
overvalued currency - Answer-When the value of a currency is believed to be higher
than what is perceived to be its market equilibrium value, based on its balance of
payments position or its international purchasing power.
Preferential trade agreement - Answer-Where a country agrees to give preferential
access, e.g. reduced tariffs, to certain products from one or more trading partners.
quota - Answer-Import barriers that set limits on the quantity or value of imports that
may be imported into a country.
retaliatory tariff - Answer-Where a country responds to the imposition of a tariff by a
trading partner by imposing a tariff on that country's products.
revaluation - Answer-An increase in the value of a country's currency in a fixed
exchange rate system.
speculation (in the context of exchange rates) - Answer-Where foreign currency traders
make a decision to buy or sell a currency based on their expectations of future
exchange rate movements.
subsidy (in the context of international trade) - Answer-An amount of money paid by the
government to a firm, per unit of output, to encourage output and to give the firm an
advantage over foreign competition.
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through EFT, credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying this summary from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller Perfectscorer. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy this summary for R241,35. You're not tied to anything after your purchase.
