Deck 4: Regional Economic and Political Integration

Question 1

Regional proximity is not an important facilitator of economic cooperation.

Answer 1

False
Regional proximity is an important facilitator of economic cooperation. Communication and transportation are facilitated by regional proximity, and these help to facilitate economic cooperation.

Question 2

In the case of the Southern Cone Common Market (MERCOSUR), the member countries agree with the associate members on the common external tariffs they should impose on international business entering the region.

Answer 2

False
In the case of the Southern Cone Common Market (MERCOSUR), the member countries disagree with the associate members on the common external tariffs they should impose on international business entering the region.

Question 3

Countries in East Africa formerly colonized by Belgium share a common second language (French), and have extensive economic and political ties with Belgium.

Answer 3

True
Countries in East Africa formerly colonized by Belgium share a common second language (French), as well as extensive economic and political ties with the former colonist.

Question 4

Iceland, Liechtenstein, Norway, Switzerland, and Germany are the current members of the European Free Trade Association.

Question 5

The goal of ASEAN is to ultimately create a free trade area where tariff and non-tariff barriers are eliminated.

Question 6

In regional economic integration, most countries begin with developing a common market.

Question 7

People in neighboring countries often share a language, as well as other cultural elements.

Question 8

The Asia-Pacific Economic Cooperation (APEC) is attempting to forge an institutional integration that will lead to a free trade association.

Question 9

Under the NAFTA agreement, in order to benefit from a duty-free status, goods must have a 51% North American content.

Question 10

Countries with a different level of economic development are more likely to be successful in establishing and maintaining regional economic integration mechanisms than countries of similar levels of economic development because the more powerful country acts as a "benevolent dictator."

Question 11

A common language between neighboring countries facilitates commerce and marketing.

Question 12

One of the more important obstacles to regional economic and political integration is the threat of losing national identity and sovereignty as part of the larger regional structure.

Question 13

The countries of the former Soviet Union have experienced Russian economic, political, and cultural dominance. As a result, Russian is spoken in many countries in Europe and Asia that were formerly part of the Soviet Empire.

Question 14

Former colonies of the British Empire form the Commonwealth of Independent States, a body that meets periodically to address issues of common concern and that recognizes the British monarchy as its symbolic leader.

Question 15

In spite of the national vote against joining the European Union, Switzerland is engaging in bilateral negotiations, securing agreements that would help it to join.

Question 16

In a free trade agreement, countries are free to charge their own tariffs to all entities external to the free trade market.

Question 17

A history of dominance by one nation in a region often leads to shared cultural elements among the different peoples in that region.

Question 18

The European Union is characterized by a shared regional culture.

Question 19

The Commonwealth of Independent States (CIS) has never had any noteworthy economic content.

Question 20

None of the European Free Trade Association (EFTA) members have joined the European Monetary Union.

Question 21

The Southern Cone Common Market (MERCOSUR) is looking North, at NAFTA, for trade and cooperation accords.

Question 22

Countries that are full members of the European Monetary Union are often referred to as "Euroregion."

Question 23

Only the European Union has achieved the common market stage of economic integration for ALL member states.

Question 24

The 1992 Maastricht Treaty had as a purpose to provide for the European Monetary Union (EMU) and to create the European Central Bank, a single currency, and fixed exchange rates.

Question 25

Because of the NAFTA agreement, the U.S. has removed all trade barriers for companies operating in Mexico and Canada.

Question 26

The North American Free Trade Agreement (NAFTA) is an ambitious plan to create a market of about 800 million people and an annual production worth $11 trillion in the Americas.

Question 27

The Andean Community (AnCom) has eliminated trade restrictions (tariff and non-tariff) within the Andean region, but it has not yet agreed on uniform external tariffs and rules for foreign investment.

Question 28

The Andean Common Market and the Southern Cone Common Market aspire to become a common market.

Question 29

The European Court of Justice is the European Union's equivalent of the U.S. Supreme Court. However, unlike the U.S. Supreme Court, the European Court of Justice's decisions are not final.

Question 30

The West African Economic and Monetary Union (WAEMU) is one of the first attempts at economic integration in Africa.

Question 31

Successful monetary unions also mean a successful economic integration and the elimination of trade restrictions for members of the union.

Question 32

One of the reasons that the Economic Community of West African States (ECOWAS) has not been able to achieve complete economic integration is because Nigeria has dominated the group.

Question 33

In Europe, member countries agreed at the Treaty of Rome to establish the European Economic Community, which eliminated all tariffs, established common external tariffs, and allowed for the free movement of capital and labor within its territory.

Question 34

Political union represents the highest level of integration.

Question 35

The Latin American Integration Association does not offer a differential treatment to countries of different levels of development in an attempt to standardize its polices.

Question 36

South Africa is a member of The Common Market for Eastern and Southern Africa (COMESA).

Question 37

A monetary union represents the highest level of integration between countries.

Question 38

According to the European Exchange Rate Mechanism (ERM), a currency could only fluctuate up to 2.5% of its value in either direction; when this value was consistently surpassed, the mechanism would adjust the currency upward or downward, respectively, creating a snake-like structure.

Question 39

The Andean Common Market (AnCom) was responsible for eliminating trade restrictions (tariff and nontariff) within the Andean region.

Question 40

The Southern African Development Community is a free trade organization that promotes economic cooperation among a coalition of 14 of Africa's more affluent and developed nations.

Question 41

Which of the following is not a commonality shared by member countries of the European Union?

A)A highly developed industrial base.
B)High GDP per capita.
C)Extensive transportation infrastructure.
D)All of the above are shared by members of the EU.

Question 42

Members of the European Union often differ with regard to the economic and trade policies they advocate. Which of the following is an accurate description of one of those differences as illustrated in your text?

A)Germany believes that the government should actively regulate business.
B)France stresses market development at the expense of social welfare.
C)The Netherlands stresses the importance of market mechanisms and interferes only minimally business regulation.
D)Great Britain believes that genetically altered seeds should not be imported.

Question 43

Countries in East Africa were formerly colonized by ____ and share a common second language, as well as ties with the former colonist.

A)Belgium
B)Canada
C)Turkey
D)Spain

Question 44

Which of the following is a factor that prompts countries to favor trade with other countries?

A)Sharing a culture
B)Sharing a common language
C)Sharing a common border
D)All of the above.

Question 45

Which economic organization was established in Canberra, Australia, to mitigate the economic block and trade protection trend prevailing in the 1970's and 1980's?

A)Commonwealth of Independent States
B)Asia-Pacific Economic Cooperation
C)The West African Economic and Monetary Union
D)The Association of Southeast Asian Nations

Question 46

Former colonies of the British Empire ____.

A)recognizes the British monarchy as its symbolic leader
B)are part of the Commonwealth of Independent States
C)were dominated by the Russian Empire
D)are now all members of the European Union

Question 47

Which of the following is not a free trade agreement?

A)EFTA
B)North American Free Trade Agreement
C)Nordic Free Trade Agreement
D)Southern African Development Community

Question 48

The Organization for Petrol Exporting Countries (OPEC), the North Atlantic Treaty Organization (NATO), and the Organization for Economic Co-operation and Development (OECD) are all examples of:

A)common markets
B)bilateral agreements
C)multilateral agreements
D)free trade agreements

Question 49

Which country is the only European Free Trade Association country to participate in the Schengen agreement on the elimination of border controls.

A)Iceland
B)Sweden
C)Norway
D)Switzerland

Question 50

Russian dominance in the former Soviet Union led to the use of the Russian language in many countries in Europe and Asia. In which of the following countries has Russian never been used?

A)Estonia
B)Lithuania
C)Turkmenistan
D)Russian has been used in all the above countries

Question 51

A history of dominance by one nation in a region often leads to shared

A)cultural elements
B)currencies
C)natural resources
D)None of the above is true.

Question 52

Which country is a member of the Association of Southeast Asian Nations (ASEAN)?

A)Japan
B)China
C)Taiwan
D)Laos

Question 53

The twelve non-Baltic successors to the Union of the Soviet Socialist Republics formed the

A)Commonwealth of Independent States
B)Central European Free Trade Agreement
C)Central Asian Trade Federation
D)Southern Cone Common Market

Question 54

The focus of the EU is eastern expansion and the constraints they are faced with are:

A)numerous complexities related to the different stages and phases of eastward enlargement.
B)possibilities of looser associated memberships.
C)special rights of non-members.
D)All of the above are correct.

Question 55

Most of the Asia-Pacific Economic Cooperation's (APEC) advances so far have been made in the area of

A)transportation
B)manufacturing
C)computers and the Internet
D)textiles

Question 56

The countries of the former Soviet Union shared a history of ____.

A)Russian cultural dominance
B)Russian political dominance
C)state-owned enterprises
D)All of the above

Question 57

Which of the following is not true regarding the members of the European Union?

A)Members of the EU are regionally proximal.
B)Members of the EU are culturally similar.
C)Members of the EU are adopting a common currency.
D)Members of the EU have a highly developed transportation infrastructure.

Question 58

Which country is not a member of the European Free Trade Association?

A)Iceland
B)Liechtenstein
C)Great Britain
D)Switzerland

Question 59

The perception of European Union members is that EFTA members

A)have unstable economies.
B)would like to have more impact on the decision-making process within the EU.
C)have nothing to offer the EU.
D)are likely to adopt the Euro as their common currency by 2010.

Question 60

Countries in East Africa ____.

A)were colonized by Belgium.
B)use French as their second language.
C)maintain strong ties with their former colonist.
D)all of the above are true.

Question 61

ECOWAS plans to merge with the WAEMU by 2004. Which of the following is not a convergence criteria for the merger?

A)ECOWAS members must control inflation to 5%.
B)ECOWAS countries must have a maximum budget deficit-to-GDP ration of 4%
C)Central bank financing of the budget deficit is limited to 10% of the previous year's tax revenue
D)All of the above are required.

Question 62

The European Exchange Rate Mechanism was also known as the "snake" because it

A)was despised by member countries with strong currencies.
B)changed its shape based on the fluctuation of the different currencies.
C)had a "venomous bite" on weaker currencies of the EU.
D)None of the above are true.

Question 63

Which organization has the ambitious goal of creating a free trade association that will create a market of about 800 million people and an annual production worth $11 trillion in the Americas?

A)The Free Trade Area of the Americas
B)The North American Free Trade Agreement
C)The Latin American Integration Association
D)The Central American Common Market

Question 64

Which of the following is not a successful monetary union?

A)European Monetary Union
B)South American Monetary Union
C)West African Economic and Monetary Union
D)Economic Community of West African States

Question 65

Why was the Southern African Development Community (SADC) founded?

A)to foster increased economic and governmental stability
B)to gain better medical facilities in Africa
C)to gain more positive global recognition
D)to facilitate global communication

Question 66

____ is a member of the South African Customs Union (SACU).

A)South Africa
B)Botswana
C)Zimbabwe
D)Mozambique

Question 67

Which of the following is located in Strasbourg, France and is a body of members elected every five years by direct universal suffrage?

A)The European Council
B)The European Parliament
C)The Council of Nations
D)The Council of Ministers

Question 68

Which country is not a member of the Latin American Integration Association?

A)Panama
B)Colombia
C)Peru
D)Mexico

Question 69

The economic agreement between Belize, Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, Nicaragua, and Panama is known as

A)the Southern Cone Common Market
B)the Andean Common Market
C)the Latin American Integration Association
D)the Central American Common Market

Question 70

Which of the following countries is not a full member of the European Monetary Union?

A)Austria
B)Great Britain
C)Belgium
D)Germany

Question 71

Which country left the Andean Common Market in 1997?

A)Bolivia
B)Colombia
C)Ecuador
D)Peru

Question 72

Why did the Latin American Free Trade Association (LAFTA) fail?

A)did not have international support
B)did not have enough member countries to survive economically
C)the low level of development of member countries
D)had a poor governing system in place

Question 73

Which agreement had as a purpose to provide for the European Monetary Union and to create the European Central Bank, a single currency, and the fixed exchange rates?

A)The Warsaw Pact
B)The Geneva Convention
C)the Treaty of Rome
D)The Maastricht Treaty

Question 74

Under the North American Free Trade Agreement (NAFTA), what percentage of a good must be of North American content in order to be duty-free?

A)20%
B)40%
C)60%
D)80%

Question 75

The Southern Cone Common Market (MERCOSUR) initially started as a bilateral agreement between which two countries?

A)Chile and Bolivia
B)Colombia and Ecuador
C)Brazil and Argentina
D)Paraguay and Uruguay

Question 76

Which entity has achieved the common market stage successfully?

A)The European Union
B)The Andean Common Market
C)The Southern Cone Common Market
D)The Central American Common Market

Question 77

Which level of integration represents the highest level of integration?

A)Political union
B)Monetary union
C)Common market
D)Free trade agreement

Question 78

Recently, the European Commission blocked the merger of MCI Worldcom and Sprint because

A)MCI would gain access to Sprint avionics equipment, and pose a national security risk.
B)the European telecommunications infrastructure standards are different that Sprint's current technology deployment.
C)the company would be able to dictate prices for Internet access in Europe.
D)British Telecom opposed the merger.

Question 79

A customs union is a free trade association that may have either eliminated or greatly reduced all tariffs and other trade restrictions for member countries and that has adopted

A)a common currency.
B)a central bank.
C)common external tariffs.
D)common monetary policies.

Question 80

What difficulty does the Common Market for Eastern and Southern Africa (COMESA) currently face?

A)poor compliance with tariff reductions
B)concerns over customs revenue losses
C)South Africa is not a member of COMESA
D)all of the above