Quick Quiz (6)

A quick 10 questions from section 4 (International economics).

1) State three reasons why countries trade

2) Explain the difference between absolute and comparative advantage. (HIGHER LEVEL ONLY)

3) State four different types of protectionist policies

4) Explain the infant industry argument

5) Explain what a customs union is.

6) Explain the difference between trade creation and trade diversion (HIGHER LEVEL ONLY)

7) State two arguments in favour of the WTO

8) Briefly outline the structure of the balance of payments

9) What is the difference between a depreciation and a devaluation

10) State the formula for the terms of trade. What does it show?