Trade Agreements Answers

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1
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What is the most common reason why countries create trade agreements?

A
to limit imports
B
to create free trade
C
to establish quotas
D
to decrease trade
2
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What can be a result of free trade? Check all that apply.

A
trade imbalances
B
decreased production
C
lower economic growth
D
increased pollution
E
exploitation of workers
F
new opportunities
3

Read the following quotation by President Bill Clinton."Free trade can be a win-win for everyone, but only if it is based on fair rules, enforced faithfully, with adequate safeguards to protect the rights of workers and the environment.” With which statement would President Bill Clinton most likely have agreed?

A
Free trade helps every nation.
B
Free trade has drawbacks for participants.
C
Free trade will eliminate poverty.
D
Free trade must be carefully monitored.
4

One primary purpose of the European Union is to

A
create a common market.
B
eliminate borders between countries.
C
allow highly skilled workers to be employed.
D
limit trade among member countries.
5

A specific territory or zone that has laws and regulations different from the rest of the country is called a(n)

A
work zone.
B
border zone.
C
tax-free zone.
D
economic zone.
6

Which group primarily helps settle trade disputes?

A
European Union
B
World Trade Organization
C
Association of Southeast Asian Nations
D
North American Free Trade Agreements
7

Why were free trade zones created in China?

A
to avoid governmental rules and conditions
B
to attract investments by foreign countries
C
to import technology more easily
D
to control imports and exports
8

Which trade organization is responsible for 90% of the world’s trade?

A
the EU
B
ASEAN
C
the WTO
D
NAFTA
9

What is one stated purpose of the World Trade Organization?

A
to create a common currency
B
to encourage the expansion of exports
C
to monitor trade policies of many countries
D
to establish direct trade agreements between countries
10

International trade organizations promote free trade by encouraging countries to

A
maintain their tariffs.
B
establish their trade quotas.
C
reduce their trade barriers.
D
develop their products.
11

The primary benefit of a Free Trade Agreement is that they

A
allow countries to charge high tariffs on imports and exports.
B
allow countries to more easily buy what they do not produce.
C
have fewer economic restrictions than trade organizations.
D
can fund international finance projects.
12

How can a nation benefit from effectively exporting its goods?

A
Its citizens can buy cheaper goods.
B
Its businesses can invest in the future.
C
Its domestic spending increases.
D
Its citizens have more money.
13

Trade agreements can cause jobs to go to countries that provide those jobs

A
efficiently.
B
expensively.
C
freely.
D
gradually.
14

Countries establish internal economic zones in order to

A
limit foreign investment.
B
make solving disputes easier.
C
have fewer economic restrictions.
D
create manageable amounts of imports.

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