International Trade Overview
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Questions and Answers

What objects served as currency before the advent of paper and coin currency?

  • Rare objects with high intrinsic value (correct)
  • Only gold and silver
  • Items that were commonly found in nature
  • Exclusively agricultural products

    • What does the term 'Salarium' refer to in terms of historical payment?

  • Payment received for labor
  • Payment made by salt (correct)
  • Payment through barter system
  • Payment made in gold

    • Which of the following was a significant risk associated with ancient trade?

  • High competition among wealthy traders
  • Transporting goods over long distances (correct)
  • Excessive taxation by governments
  • Too many available goods in local markets

    • Who primarily benefited from the trade of luxury items in ancient times?

    <p>Wealthy individuals</p> Signup and view all the answers

    What was the primary function of the Silk Route?

    <p>A trade connection between Rome and China</p> Signup and view all the answers

    What happened to the monetary value of raw materials after the Industrial Revolution?

    <p>It depreciated in relation to manufactured goods</p> Signup and view all the answers

    What kind of markets were predominantly operated in ancient times for basic necessities?

    <p>Local markets</p> Signup and view all the answers

    Which of the following items was NOT mentioned as a form of currency in ancient times?

    <p>Paper notes</p> Signup and view all the answers

    What significant change occurred in European commerce after the disintegration of the Roman Empire?

    <p>Trade with Asia increased due to warships development.</p> Signup and view all the answers

    Which countries were primarily involved in the transatlantic slave trade?

    <p>Portugal, Dutch, Spain, and Britain</p> Signup and view all the answers

    What was a key outcome of the World Wars I and II regarding international trade?

    <p>Introduction of trade taxes and quantitative restrictions.</p> Signup and view all the answers

    When was the slave trade finally abolished in Great Britain?

    <p>1807</p> Signup and view all the answers

    What does international trade primarily result from?

    <p>Specialization and division of labor.</p> Signup and view all the answers

    What was one impact of the General Agreement for Tariffs and Trade (GATT) after the war?

    <p>It facilitated the reduction of tariffs.</p> Signup and view all the answers

    Which type of products did European nations export back to non-industrialized nations during their colonial period?

    <p>Value-added finished products</p> Signup and view all the answers

    Which of the following is an example of specialization in international trade?

    <p>China producing fine porcelains</p> Signup and view all the answers

    What is multi-lateral trade characterized by?

    <p>Trade conducted with multiple countries</p> Signup and view all the answers

    What does trade liberalization primarily aim to achieve?

    <p>Enhance competition from international goods and services</p> Signup and view all the answers

    What is one purpose of Regional Trade Blocs?

    <p>To encourage trade among geographically proximate countries</p> Signup and view all the answers

    What is the significance of the World Trade Organization (WTO)?

    <p>It handles global rules for trade among nations</p> Signup and view all the answers

    What did the General Agreement for Tariffs and Trade (GATT) aim to address?

    <p>Liberalize trade from high customs tariffs</p> Signup and view all the answers

    How many regional trade blocs are currently generating world trade according to the information?

    <p>120</p> Signup and view all the answers

    What challenge could arise in the future regarding trade between different trading blocs?

    <p>Difficulty in promoting free trade</p> Signup and view all the answers

    What does granting 'Most Favoured Nation' (MFN) status imply?

    <p>A country receives favorable trading terms from others.</p> Signup and view all the answers

    What is considered an important indicator of a port's significance?

    <p>The quantity of cargo handled</p> Signup and view all the answers

    Which type of port is located away from the sea coast and linked to the sea through rivers or canals?

    <p>Inland Ports</p> Signup and view all the answers

    Which characteristic is NOT associated with comprehensive ports?

    <p>Located at the mouth of rivers</p> Signup and view all the answers

    Why is sustainable development important for organizations involved in international trade?

    <p>To avoid serious future implications</p> Signup and view all the answers

    What do port authorities manage to facilitate the operations of a port?

    <p>Navigable channels and supporting services</p> Signup and view all the answers

    How many countries were members of the WTO as of December 2016?

    <p>164 countries</p> Signup and view all the answers

    What could happen if environmental and health concerns are neglected by profit-driven organizations?

    <p>Serious implications in the future</p> Signup and view all the answers

    Which option is NOT a role of ports in international trade?

    <p>Offering tourism services</p> Signup and view all the answers

    Which type of port specializes in bulk cargo like grain and oil?

    <p>Industrial Ports</p> Signup and view all the answers

    Which of the following correctly identifies a characteristic of oil ports?

    <p>They deal with the processing and shipping of oil.</p> Signup and view all the answers

    What is the primary function of commercial ports?

    <p>To handle general cargo and passenger traffic.</p> Signup and view all the answers

    Which port is mentioned as an example of a tanker port?

    <p>Abadan</p> Signup and view all the answers

    Which of the following is true about out ports?

    <p>They have deep water to accommodate large ships.</p> Signup and view all the answers

    Which pair of ports represents a classic combination example?

    <p>Athens and Piraeus</p> Signup and view all the answers

    Which of the following describes ports of call?

    <p>They serve as docking points for ships traveling across water bodies.</p> Signup and view all the answers

    What type of cargo do industrial ports handle?

    <p>Bulk cargo like chemicals and ore</p> Signup and view all the answers

    What occurs when a country imports more goods than it exports?

    <p>Negative balance of trade</p> Signup and view all the answers

    Which of the following best describes bilateral trade?

    <p>Trade that occurs between two countries based on a mutual agreement</p> Signup and view all the answers

    How can globalization and free trade adversely affect developing countries?

    <p>By allowing richer countries to dominate markets</p> Signup and view all the answers

    What is the definition of dumping in international trade?

    <p>Selling a commodity at different prices in different markets not related to costs</p> Signup and view all the answers

    What is one implication of having a negative balance of trade?

    <p>Potential exhaustion of financial reserves</p> Signup and view all the answers

    What impact does improved transportation and communication systems have on trade?

    <p>Allows goods to travel faster and farther</p> Signup and view all the answers

    What does a positive balance of trade indicate about a country's economic situation?

    <p>It has a surplus of exports over imports</p> Signup and view all the answers

    Countries need to be cautious about dumped goods because they can:

    <p>Harm local producers due to price competition</p> Signup and view all the answers

    Study Notes

    International Trade

    • Trade involves the voluntary exchange of goods and services between two parties.
    • Trade can occur at international and national levels.
    • International trade is the exchange of goods and services between countries.
    • Countries trade to obtain goods they cannot produce themselves or that are cheaper elsewhere.
    • Early trade was often a barter system, where goods were exchanged directly.
    • Difficulties in the barter system led to the development of money.
    • The Silk Road facilitated trade between Rome and China, transporting silk and other goods.
    • Colonialism and the slave trade were prominent forms of international trade.
    • The Industrial Revolution shifted trade towards raw materials and finished goods.
    • Trade was affected by wars through trade taxes and restrictions.
    • The World Trade Organisation (WTO) aims to manage trade relations and resolve disputes between countries.

    Basis of International Trade

    • Differences in national resources: Natural resources like minerals, fertile land, and climates vary across countries, leading to differing production capabilities.
    • Different stages of economic development: Countries at early stages of development mostly produce and trade raw materials, while developed countries tend to trade manufactured products.
    • Extent of foreign investment: Developing nations might rely on investment from other countries to develop industries and initiate trade.
    • Transportation: Improved transportation systems increase the volume and speed of trade between countries.
    • Cultural factors: Differences in cultures can influence the types of goods traded and their value in different regions.

    Types of International Trade

    • Bilateral trade: Trade between two countries, often with specific agreements.
    • Multi-lateral trade: Trade between multiple countries, often involving various commodities.

    Balance of Trade

    • Records imports and exports, and indicates a country's trade surplus (exports > imports) or deficit (imports > exports).
    • Negative balance (imports > exports) signifies a country spending more than it earns through trade.
    • Positive balance (exports > imports) signifies a country earning more from trade than it spends.
    • Dumping is selling goods in another country for a cheaper price than in the home country. This practice can harm domestic producers.

    Regional Trade Blocs

    • Encourage trade between countries with geographical closeness and trade similarities.
    • Regional trade blocs reduce trade restrictions among member nations.
    • The WTO aims to improve the global trading arena by promoting fairness and reducing trade barriers.

    Ports (Gateways of International Trade)

    • Ports provide facilities for loading, unloading, and storage of goods and passengers.
    • Types of ports are classified according to the types of traffic they manage (industrial, bulk cargo, commercial, etc.).
    • Port locations and specialization in types of cargo (i.e., oil, passenger, etc.) are crucial differentiators.
    • The volume of cargo handled by a port is an indicator of its hinterland's development.

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    International Trade PDF

    Description

    This quiz covers the fundamentals of international trade, including its definition, historical context, and key developments such as the Silk Road and the role of the WTO. Learn about how countries engage in trade to meet their needs and how historical events have shaped trade practices. Test your knowledge of both international and national trade dynamics.

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