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Questions and Answers
What is the primary role of the International Court of Justice?
How many Trust Territories achieved independence in 1994?
What is the Security Council primarily responsible for?
Which chapter of the UN Charter concerns collective military security?
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What aspect of governance is described as fragmented and complex?
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Which organ of the UN serves as the principal judicial organ?
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What is one of the key questions raised regarding global governance reform?
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How often does the council overseeing Trust Territories meet?
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What does an economy that rises above borders and is free moving imply?
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What is the primary advantage of specialization in production?
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Which of the following best describes international specialization?
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What is a potential outcome of mass production in the context of trade?
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Why do countries engage in trade?
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What role does the division of labor play in specialization?
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What does specialization NOT directly lead to in an economy?
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What is a consequence of specialization on the global economy?
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What was a significant economic event that marked the beginning of the economic crisis?
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What is the primary function of the United Nations as described?
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What system was established during the Bretton Woods Conference in 1994?
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How many member countries does the United Nations currently count?
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What are the Sustainable Development Goals aimed at?
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Which council was established to manage international legal issues?
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What is an essential role of the UN's Secretariat?
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What body is composed of 54 elected members serving overlapping terms?
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What is the main goal of protectionism?
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What is one potential downside of protectionist policies?
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How does free trade affect the economy according to the content?
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What can protectionism help build up in the economy?
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What is an example of a 'strategic' industry mentioned in the content?
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What is a potential reason for implementing tariffs on imports?
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What might be a consequence of imposing limits on agricultural imports?
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What does the term 'food security' relate to in the context of protectionism?
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What is a potential consequence of over-specialization in international trade?
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What does the product life-cycle theory explain?
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Which of the following best describes the New Trade Theory developed by Paul Krugman?
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What factor does Michael Porter emphasize as crucial for a nation's competitive advantage?
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Which approach advocates for unrestricted movement of goods and services between countries?
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What is a likely reason for countries to impose trade restrictions?
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What does the Heckscher–Ohlin theory focus on?
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How might cheaper imports impact local producers?
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Study Notes
Global Economy
- A global economy defies borders and governments.
- It raises questions about the role of governments in a globalized world.
- Countries are playing a diminished role in their own economies.
Globalization
- Results from: development of an economy that transcends borders.
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Impacts:
- Openly questioned the role of governments.
- Diminished influence of states on their own economies.
Specialization
- Definition: The division of labor, where workers, producers, firms, or countries focus on specific tasks.
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Benefits:
- Efficiency and productivity gains.
- Increased contribution to the overall production process.
International Specialization
- Definition: Countries utilize scarce resources to produce a limited range of products in high volume.
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Benefits:
- Mass production and surplus goods for export.
- Promotes international trade as countries import goods they don't specialize in.
Why Countries Trade
- Countries trade when they lack resources or capacity to meet their own needs and wants.
The Pattern of International Trade
- Explores theories that explain international trade patterns.
- Focuses on the contributions of Adam Smith, David Ricardo, and Heckscher-Ohlin.
Trade: Free Trade vs. Protectionism
- Free Trade: Encourages the free movement of goods and services between countries, promoting economic growth.
- Protectionism: Restricts trade for objectives like protecting jobs, safeguarding strategic industries, and supporting new industries.
Arguments for Free Trade
- Increases the overall size of the economy.
- Promotes efficient production based on resource allocation.
- Facilitates global economic growth.
Challenges of International Trade
- Over-specialization risks job losses when demand falls.
- Domestic industries can decline due to foreign competition.
- New industries struggle against established foreign firms.
- Local producers face competition from cheaper imports.
Theories of International Trade
- Heckscher-Ohlin Theory: Explains trade patterns based on factor endowments (e.g., land, labor, capital).
- Product Lifecycle Theory: Explains the evolution of trade patterns over a product's lifecycle.
- New Trade Theory: Emphasizes that the world market can only support a limited number of firms in certain industries, leading to first-mover advantages.
- Porter's Theory of National Competitive Advantage: Highlights the importance of domestic demand and industry rivalry in determining a nation's success.
The United Nations
- Prime organization for international cooperation, peace, and security.
- Authorizes the use of force against aggressors.
- Primary focus on ensuring global security.
- Facilitates peaceful dispute resolution between member states.
- Aims to ensure shared prosperity through a range of agencies and institutions.
- Articulated the Sustainable Development Goals in 2015.
UN Organs
- General Assembly: Makes recommendations through its 193 members.
- Security Council: The most powerful organ with legally binding resolutions.
- International Court of Justice: Settles legal disputes and provides legal opinions.
- Secretariat: Implements UN decisions, led by the Secretary-General.
- Economic and Social Council (ECOSOC): Coordinates UN's economic and social work.
- Trusteeship Council: Provided international supervision of Trust Territories but is now suspended.
Global Governance
- Complex and fragmented.
- Key questions are:
- How to reform existing institutions?
- How to develop alternative institutions?
- How to leverage technology for better governance?
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Description
Test your knowledge on the global economy, its implications for government roles, and the concept of specialization within international trade. Understand how countries engage in effective production and the effects of globalization on their economies. Explore the benefits and challenges posed by these economic structures.
