Question 1

According to Ricardo, trade is possible between two countries when

Accepted Answer

A) One country has absolute advantage in production of both commodities 
B) One country has an absolute advantage for production of both commodities but comparative advantage in the production of one commodity than the other country 
C) One country does not have any advantage in the production of both commodities 
D) A country does not have any line of production 
A) One country has absolute advantage in production of both commodities 
B) One country has an absolute advantage for production of both commodities but comparative advantage in the production of one commodity than the other country 
C) One country does not have any advantage in the production of both commodities 
D) A country does not have any line of production

Question 2

According to Ohlin, the comparative cost differences arise because of

Accepted Answer

A) Labour cost differences 
B) Factor endowment differences 
C) Exchange rate differences 
D) None of the above 
A) Labour cost differences 
B) Factor endowment differences 
C) Exchange rate differences 
D) None of the above

Question 3

Which of the following is the cause of international trade as per Heckscher-Ohlin trade theory?

Accepted Answer

A) Difference in factor availability 
B) Difference in cost of production 
C) Difference in trade 
D) Difference in currency system 
A) Difference in factor availability 
B) Difference in cost of production 
C) Difference in trade 
D) Difference in currency system

Question 4

According to Adam Smith, free trade is the result of

Accepted Answer

A) Division of labour and specialisation both at the national and international level 
B) Specialisation only at the national level 
C) Division of labour and specialisation at the national level only 
D) Division of labour only at the international level 
A) Division of labour and specialisation both at the national and international level 
B) Specialisation only at the national level 
C) Division of labour and specialisation at the national level only 
D) Division of labour only at the international level

Question 5

The Absolute Advantage theory of international trade was propounded by

Accepted Answer

A) Adam Smith 
B) David Ricardo 
C) Alfred Marshall 
D) Lionel Robbins 
A) Adam Smith 
B) David Ricardo 
C) Alfred Marshall 
D) Lionel Robbins

According to Ricardo, trade is possible between two countries when

According to Ohlin, the comparative cost differences arise because of

Which of the following is the cause of international trade as per Heckscher-Ohlin trade theory?

According to Adam Smith, free trade is the result of

The Absolute Advantage theory of international trade was propounded by

Understanding International Trade Theories and Terms

Understanding Terms of Trade and Trade Gains Theory

Understanding Tariffs and Trade Policies

Understanding Tariffs and Quotas in International Trade

International Finance and Balance of Payments

Indias Balance of Payments and Foreign Trade: Part A

Indias Balance of Payments and Foreign Trade: Part B

Filters

Exam 1: Theories and Concepts in International Trade

According to Ricardo, trade is possible between two countries when

According to Ohlin, the comparative cost differences arise because of

Which of the following is the cause of international trade as per Heckscher-Ohlin trade theory?

According to Adam Smith, free trade is the result of

The Absolute Advantage theory of international trade was propounded by

Understanding International Trade Theories and Terms

Understanding Terms of Trade and Trade Gains Theory

Understanding Tariffs and Trade Policies

Understanding Tariffs and Quotas in International Trade

International Finance and Balance of Payments

Indias Balance of Payments and Foreign Trade: Part A

Indias Balance of Payments and Foreign Trade: Part B

Filters