Question : 19.5   The Arguments over Trade Policies and Globalization 1) Disagreements about : 1267006

19.5   The Arguments over Trade Policies and Globalization

1) Disagreements about whether the U.S. government should regulate international trade

A) began during the Great Depression.

B) began after World War I when government officials no longer believed in isolationism.

C) date back to the beginning of the country.

D) did not occur until the end of the Mexican War in 1848.

2) ________ raised average tariff rates by over 50 percent in the United States in 1930.

A) The GATT

B) The WTO

C) NAFTA

D) The Smoot-Hawley Tariff

3) In 1930, the U.S. government attempted to help domestic firms that were harmed by the Great Depression by

A) establishing the General Agreement on Tariffs and Trade (GATT).

B) passing the Smoot-Hawley Tariff.

C) establishing the World Trade Organization (WTO).

D) passing the North American Free Trade Agreement (NAFTA).

4) In 1995 ________, which was established in 1948, was replaced by ________.

A) the GATT; the WTO

B) the WTO; NAFTA

C) the Smoot-Hawley Tariff; the GATT

D) NAFTA; the Smoot-Hawley Tariff

5) The World Trade Organization (WTO) promotes foreign trade and investment, or globalization.  In recent years opposition to globalization has led to violent protests at meetings of the WTO.  One reason for these anti-globalization protests is

A) foreign trade and investment are examples of zero-sum games.

B) protesters believe that globalization will result in a return to communism in developing countries.

C) protesters believe that free trade destroys the distinctive cultures of many countries.

D) protesters object to the loss of intellectual property (such as software programs and movies) that results from foreign trade and investment.

6) Many people assume that if child workers in developing countries weren’t working in factories, they would be in school. In fact, children in developing countries

A) split their time evenly between work and school.

B) usually have few good alternatives to work.

C) are only allowed to work if they have attended school up to age 15.

D) who work are relatively rare, as most do attend school full time.

7) Protectionism

A) is the use of cheap labor to protect firms from paying high wages.

B) is the use of trade barriers to protect domestic firms from foreign competition.

C) refers to reductions in tariffs and other barriers that protect consumers from paying high prices.

D) refers to the use of copyright and trademark laws to protect inventors and artists from losing the rights to their creative efforts. 

8) Free trade ________ living standards by ________ economic efficiency. 

A) raises; increasing

B) lowers; decreasing

C) raises; equalizing

D) lowers; eliminating

9) Many economists criticize protectionism because it causes losses to consumers and eliminates jobs in domestic industries that use protected products.  Why, then, do some people support protectionism?

A) The criticisms of economists are based on theory.  In fact, protectionism increases consumer and producer surplus as well as employment.

B) Supporters of protectionism in high-income countries believe that wages will fall as a result of competition with firms from developing countries.

C) Supporters of protectionism believe free trade will cause their countries to lose their comparative advantage. 

D) Supporters of protectionism believe that free trade will lead to inflation. 

10) Which of the following statements is used to justify protectionism? 

A) Free trade leads to higher prices for imported goods.

B) Free trade increases employment by protecting domestic firms.

C) A country should not rely on other countries for goods that are critical to its national defense.

D) Trade restrictions are not necessary to protect new firms since they can gain experience and become more productive without protection.