Deck 20: Globalization

Question 1

Globalization is often associated with a greater tendency for allocating economic activity toward

A)multi-sector institutions
B)big government and public institutions
C)private sector and market oriented institutions
D)non-manufacturing and service oriented institutions

Answer 1

C

Question 2

Effects of Environmental Regulations on Domestic Production and Imports
Refer to the figure above.The graph represents consumers and suppliers in country that relies on imports.Curve D is domestic demand, Curve S is domestic supply and Curve I is the import supply curve.The import supply curve is horizontal because

A)the world produces a relatively small amount of this good
B)no matter how much this country buys, their demand does not impact world price
C)this is a renewable good, for which there is no shortage
D)all of the above

Answer 2

B

Question 3

The main institution governing world trade is the

A)World Trade Organization (WTO)
B)General Agreement on Tariffs and Trade (GATT)
C)Free Trade Organization (FTO)
D)there is no organization that governs world trade

Answer 3

A

Question 4

Much of the turmoil around the world could be associated with increases in population.In fact, for every world citizen at the beginning of time there are now

A)10 people
B)5 people
C)2.5 people
D)0.5 people

Question 5

The phrase "Race to the Bottom" describes

A)the weakening of environmental standards brought about by competitive pressures in the global economy.
B)the incentive for high emission companies to locate within countries with lax environmental policies.
C)the dumping of industrial waste in oceans.
D)the continual decline of wages due to global competitive pressures.

Question 6

While it is important not to draw conclusions about the effects of globalization from _________, it is equally important not to draw conclusions from _________________.

A)theory, empirical data
B)thorough statistical analysis of data, qualitative data sets
C)anecdotal evidence; subgroups of populations in aggregate data
D)anecdotal evidence; averages drawn from aggregate data

Question 7

Which of the following is a true statement?

A)Over the last 60 years, the annual growth rate of economic activity in the world has been about 3.5 percent
B)Over the last 60 years, the annual growth rate in total global exports has been about 6.2 percent
C)Over the last 60 years, international trade has grown about twice as fast as overall economic growth
D)All of the above

Question 8

Effects of Environmental Regulations on Domestic Production and Imports
Refer to the figure above.The graph represents consumers and suppliers in country that relies on imports.Curve D is domestic demand, Curve S is domestic supply and Curve I is the import supply curve.If the country allows imports, domestic demand is ____ .

A)q₁
B)q₂
C)q₀
D)none of the above

Question 9

Which of the following is considered to be a direct characteristic of globalization?

A)Increasing trade among nations
B)Interconnectedness of international financial markets
C)Movements of people both within and between countries
D)All of the above

Question 10

The example of the island of Naru, where a valuable deposit of phosphate was discovered in the early 1900s, offers the lesson that

A)globalization and increased exports lead to higher incomes for local residents.
B)natural resources lead to expanded, sustainable income for local residents.
C)an open economy and world trade do not always lead to sustainable economic growth.
D)globalization and open economies lead to poorer local economies.

Question 11

Effects of Environmental Regulations on Domestic Production and Imports
Refer to the figure above.The graph represents consumers and suppliers in country that relies on imports.Curve D is domestic demand, Curve S is domestic supply and Curve I is the import supply curve.If the country allows imports, the amount of imports demanded from world producers is ________.

A)(q₀ - 0)
B)(q₂ - q₁)
C)(q₀ - q₂)
D)(q₀ - q₁)

Question 12

Globalization is thought to shift power away from _________ to _____________.

A)national governments; regional authorities
B)regional authorities; national governments
C)international bodies; national governments
D)national governments; international bodies

Question 13

Effects of Environmental Regulations on Domestic Production and Imports
Refer to the figure above.The graph represents consumers and suppliers in country that relies on imports.Curve D is domestic demand, Curve S is domestic supply and Curve I is the import supply curve.If the country restricts imports to zero, domestic supply is ____ .A.q₁
B)q₂
C)q₀
D)none of the above

Question 14

The interconnectedness of financial markets and the rapid movement of money and other financial assets is thought to contribute to

A)trade tariffs imposed by underdeveloped countries
B)economic destabilization, especially in smaller countries
C)inflation, especially in larger countries
D)all of the above

Question 15

The Pollution Haven issue can be described as

A)political pressure to weaken environmental standards in countries with low GDPs.
B)the incentive for high emission companies to locate within countries with lax environmental policies.
C)developing countries who become dependent on accepting trash for disposal.
D)unoccupied and undeveloped land where illegal dumping takes place.

Question 16

Effects of Environmental Regulations on Domestic Production and Imports
Refer to the figure above.The graph represents automobile consumers and suppliers in country that relies on imports.Curve D is domestic demand, Curve S is domestic supply and Curve I is the import supply curve.Assume that this country imposes emissions restrictions on automobiles that raise domestic supply to S' and import supply to I'.The result of this emission policy is

A)increase imports from (q₁ - q₂) to (q₀ - q₂)
B)decrease imports from (q₁ - q₂) to (q₀ - q₂)
C)increase imports from (q₀ - q₁) to (q₂ - q₁)
D)decrease imports from (q₀ - q₁) to (q₂ - q₁)

Question 17

Which of the following is considered to be an indirect characteristic of globalization?

A)Significant realignments in political power
B)Greater inequalities in income and wealth
C)Cultural and economic homogenization
D)All of the above

Question 18

The World Trade Organization (WTO) has clear rules and guidelines that allow governments to place restrictions on imports

A)that are produced in a way that damages the environment.
B)of products that domestic producers can not produce competitively.
C)of products that interfere with domestic environmental aesthetics.
D)of products that have direct health implications, as long as it is done in a nondiscriminatory way.

Question 19

Effects of Environmental Regulations on Domestic Production and Imports
Refer to the figure above.The graph represents automobile consumers and suppliers in country that relies on imports.Curve D is domestic demand, Curve S is domestic supply and Curve I is the import supply curve.Assume that this country imposes emissions restrictions on automobiles that raise domestic supply to S' and import supply to I'.The result of this emission policy is

A)increase imports from q₁ to q₂
B)decrease domestic supply from q₀ to q₂
C)decrease domestic demand for autos from q₀ to q₂
D)all of the above

Question 20

Effects of Environmental Regulations on Domestic Production and Imports
Refer to the figure above.The graph represents consumers and suppliers in country that relies on imports.Curve D is domestic demand, Curve S is domestic supply and Curve I is the import supply curve.If the country allows imports, domestic supply is ____ .

A)q₁
B)q₂
C)q₀
D)none of the above

Question 21

An example of a regional trade agreement among groups of countries and trading partners is ________________.

A)the Transatlantic Trade and Investment Partnership
B)the Trans-Pacific Partnership
C)the North American Free Trade Agreement
D)all of the above

Question 22

The North American Free Trade Agreement (NAFTA) has been accused of encouraging US and Canadian firms to relocate to Mexico in search of

A)a pollution haven.
B)a race to the bottom.
C)reduced barriers to trade.
D)all of the above.

Question 23

One of the difficulties in trying to determine the validity of the pollution haven hypothesis is that

A)weaker environmental regulation and enforcement is not the only criteria for deciding where to locate a firm.
B)globalization has made it difficult for firms to relocate from one country to another.
C)countries may have strict environmental laws but enforcement may be lacking.
D)companies may locate in a country with strict environmental policy but break the law.

Question 24

One of the main provisions of the Montreal Protocol is

A)requirements for individual countries to phase out the production and consumption of designated substances
B)a multilateral fund where contributions from industrialized countries are used to support the activities from developing countries toward achieving controls assigned in the agreement
C)A provision for trade restrictions, banning trade in the designated substances between signatories and nonsignatories
D)all of the above

Question 25

The 1975 Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) act regulates trading in species by

A)banning trade on those that are threatened with extinction.
B)allowing trade, with conditions, for those species who may become threatened if trade is not restricted.
C)requires trade permits for those species that are protected with in at least one country.
D)all of the above.

Question 26

Trade restrictions for endangered species can be implemented through restrictions on imports or exports.Each will reduce the quantity traded, but restrictions on ______ reduce supply and ________ price, while restrictions on ____________ reduce demand and ________ price.

A)imports,increase; exports,decrease
B)exports,increase; imports,decrease
C)imports, decrease; exports increase
D)exports,decrease;imports,incresase