CA Foundation Economics – Trade Negotiations Multiple Choice Questions

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Trade Negotiations Introduction

Question 1. What are trade negotiations?

  1. Talks between countries to impose tariffs on imports
  2. Discussions between governments to limit exports
  3. Negotiations between parties to reach agreements on trade-related issues.
  4. Bilateral agreements to promote import substitution

Answer: 3. Negotiations between parties to reach agreements on trade-related issues

Explanation:

Trade negotiations are discussions between countries or parties aimed at reaching agreements on various trade-related issues, such as tariffs, quotas, and other trade barriers. ,

Question 2. Which organization plays a significant role in facilitating global trade negotiations?

  1. International Monetary Fund (IMF)
  2. World Bank
  3. United Nations (UN)
  4. World Trade Organization (WTO)

Answer: 4. World Trade Organization (WTO)

Explanation:

The World Trade Organization (WTO) plays a significant role in facilitating global trade negotiations and resolving trade disputes between member countries. .

Question 3. What is the primary objective of trade negotiations?

  1. To promote protectionism and restrict international trade
  2. To eliminate all trade barriers and achieve complete free trade
  3. To enhance cooperation among countries in trade matters
  4. To impose export restrictions on sensitive goods

Answer: 3. To enhance cooperation among countries in trade matters

Explanation:

The primary objective of trade negotiations is to enhance cooperation among countries and reach agreements that promote balanced and fair trade relations.

Question 4. Which trade negotiation round led to the establishment of the WTO in 1995?

  1. Doha Round
  2. Tokyo Round
  3. Uruguay Round
  4. Seattle Round

Answer: 3. Uruguay Round

Explanation:

The Uruguay Round of trade negotiations (1986-1994) led to the establishment of the World Trade Organization (WTO) in 1995.

Question 5. What is the role of trade negotiators in the negotiation process?

  1. To prioritize the interests of their home country without compromise
  2. To find win-win solutions and address the concerns of all parties. involved
  3. To impose unilateral trade policies on other negotiating countries
  4. To advocate for import substitution and reject foreign goods

Answer: 2. To find win-win solutions and address the concerns of, all parties involved

Explanation:

The role of trade negotiators is to find win-win solutions. that address the concerns of all parties involved in the negotiation process, leading to mutually beneficial agreements.

Question 6. What are trade negotiations in international trade?

  1. Bilateral meetings between government officials and domestic exporters
  2. Discussions between countries to resolve trade disputes
  3. Talks aimed at reaching agreements on trade policies and market access
  4. Interactions between customs officials and importers at borders

Answer: 3. Talks aimed at reaching agreements on trade policies and market access

Explanation:

Trade negotiations are discussions between countries to reach agreements on various trade-related issues, such as trade policies, tariffs, quotas, and market access.

Question 7. Which organization facilitates multilateral trade negotiations among its member countries?

  1. International Monetary Fund (IMF)
  2. World Trade Organization (WTO)
  3. United Nations (UN)
  4. World Bank

Answer: 2. World Trade Organization (WTO)

Explanation:

The World Trade Organization (WTO) facilitates multilateral trade negotiations among its member countries to promote global trade and ensure fair trade practices.

Question 8. What is the purpose of trade negotiations?

  1. To create barriers to international trade and protect domestic industries
  2. To promote import-oriented economies and increase trade deficits
  3. To resolve trade disputes between countries
  4. To improve market access and reduce trade barriers

Answer: 4. To improve market access and reduce trade barriers

Explanation:

The purpose of trade negotiations is to improve market access for goods and services and to reduce trade barriers, thereby fostering greater international trade and economic cooperation.

Question 9. Which of the following issues can be addressed in trade negotiations?

  1. Currency exchange rates and monetary policies
  2. Immigration and border control measures
  3. Intellectual property rights and patent regulations
  4. Healthcare and environmental policies

Answer: 3. Intellectual property rights and patent regulations

Explanation:

Trade negotiations can address issues related to intellectual property rights, patent regulations, and other trade-related matters, but not issues like currency exchange rates, immigration, or healthcare policies.

Question 10. What role do trade negotiators play in the negotiation process?

  1. They act as mediators between domestic industries and foreign governments
  2. They represent the interests of their countries and negotiate trade deals
  3. They provide financial assistance to exporters during negotiations
  4. They ensure the enforcement of trade agreements after negotiations

Answer: 2. They represent the interests of their countries and negotiate trade deals

Explanation:

Trade negotiators represent the interests of their countries during trade negotiations and engage in discussions to reach trade deals and agreements.

Question 11. Trade negotiations are formal discussions and dialogues between countries or trading blocs aimed at

  1. Promoting protectionism and trade barriers
  2. Increasing foreign direct investment
  3. Facilitating trade liberalization and reducing trade barriers
  4. Regulating exchange rates and monetary policies

Answer: 3.  Facilitating trade liberalization and reducing trade barriers

Question 12. The World Trade Organization (WTO) plays a significant role in international trade negotiations by

  1. Imposing trade sanctions on non-compliant countries
  2. Establishing a unified global currency
  3. Setting international standards for labor practices
  4. Providing a platform for multilateral trade negotiations and dispute settlement

Answer: 4. Providing a platform for multilateral trade negotiations and dispute settlement

Question 13. Bilateral trade negotiations involve discussions between

  1. Two countries or trading partners
  2. Multiple countries and regional blocs
  3. The World Bank and the International Monetary Fund (IMF)
  4. The United Nations and the World Trade Organization (WTO)

Answer: Two countries or trading partners

Question 14. The Trans-Pacific Partnership (TPP) and the Regional Comprehensive Economic Partnership (RCEP) are examples of

  1. Multilateral trade agreements
  2. Bilateral trade agreements
  3. Trade blocs or regional trade agreements
  4. Trade negotiations between developed and developing countries

Answer: 3. Trade blocs or regional trade agreements

Question 15. Trade negotiations aim to address various trade-related issues, including

  1. Environmental protection and climate change policies
  2. Currency exchange rate manipulation
  3. Intellectual property rights and market access
  4. Military alliances and defense spending

Answer: 3. Intellectual property rights and market access

Taxonomy Of Regional Trade Agreements (RTAS)

Question 1. What is a Regional Trade Agreement (RTA)?

  1. An agreement between two or more countries to impose tariffs on imports
  2. An agreement between two or more countries to promote free trade within a specific region
  3. An agreement between countries and international organizations to regulate global trade.
  4. An agreement between countries to restrict foreign direct investment (FDI)

Answer: 2. An agreement between two or more countries to promote free trade within a specific region

Explanation:

A Regional Trade Agreement (RTA) is an agreement between two or more countries to promote free trade within a specific region by reducing or eliminating trade barriers among the member countries.

Question 2. What is the main objective of a Regional Trade Agreement (RTA)?

  1. To restrict the flow of goods and services among member countries
  2. To encourage trade and economic cooperation within the region
  3. To impose higher tariffs on imports from non-member countries
  4. To prevent foreign companies from investing in the region

Answer: 2. To encourage trade and economic cooperation within the region

Explanation:

The main objective of a Regional Trade Agreement (RTA) is to encourage trade and economic cooperation among the member countries within the region.

Question 3. Which type of Regional Trade Agreement (RTA) involves the highest Level of economic integration among member countries?

  1. Free Trade Area (FTA)
  2. Customs Union (CU)
  3. Common Market (CM)
  4. Economic Union (EU)

Answer: 4. Economic Union (EU)

Explanation:

Among the types of RTA, the Economic Union (EU) involves the highest level of economic integration, as it includes not only the elimination of trade barriers but also common policies on economicm matters like monetary and fiscal policies.

Question 4. What is the key difference between a Free Trade Area (FTA) and a Customs Union (CU)?

  1. In an FTA, member countries have a common external trade policy, while in a CU, they don’t.
  2. In an FTA, member countries have a common currency, while in a ‘ CU, they don’t
  3. In an FTA, member countries have a common market, while in a CU, they don’t.
  4. In an FTA, member countries have a common customs territory, while in a CU, they don’t.

Answer: 4. In an FTA, member countries have a common customs territory, while in a CU, they don’t.

Explanation:

The key difference between an FTA and a CU is that in an FTA, member countries do not have a common customs territory, while in a CU, they do.

Question 5. Which Regional Trade Agreement (RTA) allows for the free movement of goods, services, capital, and labor among member countries?

  1. Free Trade Area (FTA)
  2. Customs Union (CU) ‘
  3. Common Market (CM)
  4. Economic Union (EU)

Answer: 3. Common Market (CM) ‘

Explanation:

A Common Market (CM) is an RTA that goes beyond an FTA and a CU, allowing for the free movement of goods, services, capital, and labor among member countries.

Question 6. What is a Regional Trade Agreement (RTA)?

  1. An agreement between two or more countries to promote global free trade
  2. A pact between countries within a specific region to facilitate trade and reduce barriers
  3. A treaty that regulates foreign direct investment (FDI) among member nations
  4. A legal framework to restrict imports and protect domestic industries

Answer: 2. A pact between countries within a specific region to facilitate trade and reduce barriers

Explanation:

A Regional Trade Agreement (RTA) is a pact between countries within a specific region to promote trade and reduce barriers to trade.

Question 7. How are Regional Trade Agreements classified based on the number of participating countries?

  1. Bilateral and multilateral agreements
  2. Import substitution and export-oriented agreements
  3. Free trade agreements and customs unions
  4. North-South and South-South agreements

Answer: 1. Bilateral and multilateral agreements

Explanation:

Regional Trade Agreements can be classified as bilateral (between two countries) or multilateral (involving more than two countries).

Question 8. What is the main characteristic of a Free Trade Agreement (FTA)?

  1. Member countries adopt a common external trade policy
  2. There is a complete removal of all trade barriers among member countries
  3. It allows for the free movement of people and labor across borders
  4. It focuses on protecting domestic industries through import tariffs

Answer: 2. There is a complete removal of all trade barriers among member countries

Explanation:

The main characteristic of a Free Trade Agreement (FTA) is the complete removal of trade barriers, such as tariffs and quotas, among member countries.

Question 9. What is a Customs Union in the context of Regional Trade Agreements?

  1. An agreement where member countries maintain separate external trade policies
  2. An agreement that establishes a common external trade policy among member countries
  3. A pact that promotes the free movement of goods but not services and labor
  4. A trade agreement exclusively focused on import substitution

Answer: 2. An agreement that establishes a common external trade policy among member countries

Explanation:

A Customs Union is a Regional Trade Agreement where member countries adopt a common external trade policy and impose a common external tariff on imports from non-member countries.

Question 10. Which of the following is an example of a Regional Trade Agreement?

  1. GATT (General Agreement on Tariffs and Trade)
  2. WTO (World Trade Organization)
  3. NAFTA (North American Free Trade Agreement)
  4. IMF (International Monetary Fund)

Answer: 3. NAFTA (North American Free Trade Agreement)

Explanation:

NAFTA (North American Free Trade Agreement) is an example of a Regional Trade Agreement between Canada, Mexico, and the United States.

Question 11. Regional Trade Agreements (RTAs) are agreements between

  1. Two or more countries within a region to promote trade and economic integration
  2. A country and the World Trade Organization (WTO)
  3. Developing countries and developed countries
  4. Countries and international organizations such as the World Bank

Answer: 1. Two or more countries within a region to promote trade and economic integration

Question 12. Preferential Trade Agreements (PTAs) are a type of RTA that

  1. Reduce or eliminate trade barriers between member countries
  2. Impose higher tariffs on imports from non-member countries
  3. Apply trade restrictions only to certain products and industries
  4. Promote exports but do not impact imports

Answer: 1. Reduce or eliminate trade barriers between member countries

Question 13. Free Trade Areas (FTAs) are RTAs that aim to

  1. Promote fair trade practices between member countries
  2. Establish a common currency for member countries
  3. Encourage trade and remove most or all trade barriers within the region
  4. Increase tariffs and protectionism to protect domestic industries

Answer: 3. Encourage trade and remove most or all trade barriers within the region

Question 14. Customs Unions are RTAs that involve

  1. The establishment of a common external tariff on imports from non-member countries
  2. Joint management of natural resources by member countries
  3. The formation of a military alliance between member countries
  4. Coordination of monetary policies and exchange rates among member countries

Answer: 1. The establishment of a common external tariff on imports from non-member countries

Question 15. Common Markets are RTAs that go beyond customs unions and also allow for

  1. Free movement of goods and services, but not labor and capital, within the region
  2. Free movement of labor and capital, but not goods and services, within the region
  3. Free movement of goods, services, labor, and capital within the region
  4. The formation of a common defense and security policy among member countries

Answer: 3. Free movement of goods, services, labor, and capital within the region

The General Agreement On Tariffs And Trade (GATT)

Question 1. What is the General Agreement on Tariffs and Trade (GATT)?

  1. An international organization that regulates global trade and investment
  2. A regional trade agreement between North American countries
  3. A multilateral treaty that aims to promote free trade by reducing tariffs and trade barriers
  4. A bilateral agreement between two countries to facilitate trade in specific goods

Answer: 3. A multilateral treaty that aims to promote free trade by reducing tariffs and trade barriers

Explanation:

The General Agreement on Tariffs and Trade (GATT) is a multilateral treaty that aims to promote free trade by reducing tariffs and trade barriers among its member countries.

Question 2. When was GATT established?

  1. 1947
  2. 1957
  3. 1967
  4. 1977

Answer: 1. 1947

Explanation:

GATT was established in 1947 as an international treaty to facilitate trade and reduce barriers after the end of World War II.

Question 3. Which international organization evolved from GATT?

  1. United Nations (UN)
  2. World Bank
  3. World Trade Organization (WTO)
  4. International Monetary Fund (IMF)

Answer: 3. World Trade Organization (WTO)

Explanation:

The World Trade Organization (WTO) evolved from GATT in 1995 to further expand and regulate international trade.

Question 4. What is the most favored nation (MFN) principle under GATT

  1. A country should grant the best trade terms to its most important trading partners
  2. A country should provide preferences to its neighboring nations in trade matters
  3. A country should impose higher tariffs on goods from less developed countries
  4. A country should treat all its trading partners equally, without discrimination

Answer: 4. A country should treat all its trading partners equally, without discrimination

Explanation:

The most-favored-nation (MFN) principle under GATT requires countries to treat all their trading partners equally by not discriminating among them regarding trade policies.

Question 5. How did GATT contribute to the reduction of trade barriers?

  1. Promoting import substitution policies
  2. Imposing high tariffs on imported goods
  3. By conducting trade negotiations and tariff rounds
  4. Implementing export subsidies for domestic industries

Answer: 3. By conducting trade negotiations and tariff rounds

Explanation:

GATT contributed to the reduction of trade barriers through a series of trade negotiations and tariff rounds, where member countries agreed to lower tariffs and negotiate trade agreements.

Question 6. What is the General Agreement on Tariffs and Trade (GATT)?

  1. A treaty that regulates foreign direct investment (FDI) among member nations
  2. A pact between countries within a specific region to facilitate trade and reduce barriers
  3. A multilateral agreement aimed at promoting global free trade and reducing tariffs
  4. A legal framework to restrict imports and protect domestic industries

Answer: 3. A multilateral agreement aimed at promoting global free trade and reducing tariffs

Explanation:

The General Agreement on Tariffs and Trade (GATT) was a multilateral agreement aimed at promoting global free trade and reducing tariffs on goods.

Question 7. When was the General Agreement on Tariffs and Trade (GATT) established?

  1. 1945
  2. 1947
  3. 1950
  4. 1955

Answer: 2. 1947

Explanation:

The General Agreement on Tariffs and Trade (GATT) was established in 1947, after the conclusion of the Second World War. ‘

Question 8. What was the main objective of the GATT?

  1. To regulate foreign investments and capital flows
  2. To establish common monetary policies among member nations
  3. To promote the free movement of labor across borders
  4. To reduce trade barriers and facilitate international trade

Answer: 4. To reduce trade barriers and facilitate international trade

Explanation:

The main objective of the GATT was to reduce trade barriers, such as tariffs and quotas, and promote the free flow of goods in international trade.

Question 9. How did the GATT achieve its goals?

  1. Providing financial assistance to developing countries
  2. Imposing import tariffs on specific products
  3. Through rounds of negotiations to lower tariffs and address trade issues
  4. By establishing preferential trade agreements among member countries

Answer: 3. Through rounds of negotiations to lower tariffs and address trade issues

Explanation:

The GATT achieved its goals through rounds of negotiations among member countries to lower tariffs and address various trade-related issues.

Question 10. What organization replaced the GATT in 1995?

  1. United Nations (UN)
  2. International Monetary Fund (IMF)
  3. World Trade Organization (WTO)
  4. World Bank

Answer: 3. World Trade Organization (WTO)

Explanation:

The General Agreement on Tariffs and Trade (GATT) was replaced by the World Trade Organization (WTO) in 1995, which expanded its scope to cover services and intellectual property rights in addition to goods.

Question 11. The General Agreement on Tariffs and Trade (GATT) was established in

  1. 1944
  2. 1947
  3. 1951
  4. 1955

Answer: 2. 1947

Question 12. The main objective of the GATT was to

  1. Promote regional trade agreements among developing countries
  2. Facilitate trade negotiations between developed and developing countries
  3. Reduce tariffs and trade barriers among member countries
  4. Establish a unified global currency

Answer: 3. Reduce tariffs and trade barriers among member countries

Question 13. The GATT operated as a multilateral agreement to

  1. Establish a common currency for all member countries
  2. Regulate the stock market and financial institutions
  3. Set international labor standards
  4. Promote the liberalization of international trade

Answer: 4. Promote the liberalization of international trade

Question 14. The GATT was succeeded by the World Trade Organization (WTO) in

  1. 1995
  2. 2000
  3. 1980
  4. 1975

Answer: 1. 1995

Question 15. The principle of most-favored-nation (MFN) treatment under the GATT meant that

  1. All member countries were treated equally without discrimination
  2. Developing countries received preferential treatment in trade negotiations
  3. Member countries were required to impose tariffs on non-member countries
  4. Trade barriers were imposed on specific products and industries

Answer: 1. All member countries were treated equally without discrimination

The Uruguay Round And The Establishment Of WTO

Question 1. What was the Uruguay Round in the context of international trade?

  1. A series of negotiations to regulate foreign direct investment (FDI)
  2. Talks between developed and developing countries to address climate change
  3. A comprehensive set of trade negotiations to reform and liberalize global trade
  4. A summit to discuss global poverty and humanitarian aid

Answer: 3. A comprehensive set of trade negotiations to reform and liberalize global trade

Explanation:

The Uruguay Round was a series of trade negotiations that aimed to reform and liberalize global trade, covering various aspects of international trade, including tariffs, non-tariff barriers, services,
and intellectual property rights.

Question 2. When did the Uruguay Round take place?

  1. 1970-1979
  2. 1986-1994
  3. 1995-2004
  4. 2008-2016

Answer: 2. 1986-1994

Explanation:

The Uruguay Round took place from 1986 to 1994, concluding with the signing of the Uruguay Round agreements in April 1994.

Question 3. What was the outcome of the Uruguay Round negotiations?

  1. The establishment of the World Trade Organization (WTO)
  2. The formation of the International Monetary Fund (IMF)
  3. The creation of regional trade blocs in different parts of the world
  4. The imposition of import tariffs on specific products

Answer: 1. The establishment of the World Trade Organization (WTO)

Explanation:

The outcome of the Uruguay Round negotiations was the establishment of the World Trade Organization (WTO) as the successor to the General Agreement on Tariffs and Trade (GATT).

Question 4. What is the main function of the World Trade Organization (WTO)?

  1. To regulate foreign direct investment (FDI) among member nations
  2. To establish common monetary policies among member nations
  3. To promote international cooperation in environmental protection
  4. To facilitate global trade and ensure adherence to trade rules

Answer: 4. To facilitate global trade and ensure the adherence to trade rules

Explanation:

The main function of the World Trade Organization (WTO) is to facilitate global trade, promote fair trade practices, and ensure that member countries adhere to agreed-upon trade rules.

Question 5. How does the World Trade Organization (WTO) resolve trade disputes between member countries?

  1. By imposing economic sanctions on non-compliant countries
  2. By referring disputes to an independent dispute settlement body
  3. By encouraging member countries to engage in military actions
  4. By imposing import quotas on the countries involved in the dispute

Answer: 2. By referring disputes to an independent dispute settlement body

Explanation:

The World Trade Organization (WTO) resolves trade disputes between member countries by referring them to an independent dispute settlement body, which provides a mechanism for resolving trade conflicts through legal procedures.

Question 6. What was the Uruguay Round in the context of international trade?

  1. A series of negotiations to establish the European Union (EU)
  2. A round of trade talks under the General Agreement on Tariffs and Trade (GATT)
  3. A regional trade agreement between South American countries
  4. A multilateral agreement to regulate foreign direct investment (FDI)

Answer: 2. A round of trade talks under the General Agreement on Tariffs and Trade (GATT)

Explanation:

The Uruguay Round was a series of trade talks conducted under the General Agreement on Tariffs and Trade (GATT) from 1986 to 1994.

Question 7. What was the main objective of the Uruguay Round?

  1. To establish a common currency among member countries
  2. To promote regional trade agreements in South America
  3. To reduce trade barriers and liberalize global trade
  4. To restrict the movement of labor and capital across borders

Answer: 3. To reduce trade barriers and liberalize global trade

Explanation:

The main objective of the Uruguay Round was to reduce trade barriers, such as tariffs and non-tariff barriers, and promote the liberalization of global trade.

Question 8. How did the Uruguay Round contribute to the establishment of the World Trade Organization (WTO)?

  1. By creating a new multilateral organization focused on labor standards
  2. By expanding the scope of GATT and transforming it into the WTO
  3. By forming a regional trade bloc in the Asia-Pacific region
  4. By promoting the free movement of capital and financial services

Answer: 2. By expanding the scope of GATT and transforming it into the WTO

Explanation:

The Uruguay Round resulted in the expansion of the General Agreement on Tariffs and Trade (GATT) and led to the establishment of the World Trade Organization (WTO) in 1995.

Question 9. What is the main function of the World Trade Organization (WTO)?

  1. To regulate foreign direct investment (FDI) among member nations
  2. To establish common monetary policies among member countries
  3. To promote regional economic integration in Europe
  4. To facilitate trade negotiations and dispute resolution among member countries

Answer: 4. To facilitate trade negotiations and dispute resolution among member countries

Explanation:

The main function of the World Trade Organization (WTO) is to facilitate trade negotiations and provide a platform for resolving trade disputes among its member countries.

Question 10. Which of the following agreements was a significant outcome of the Uruguay Round?

  1. Kyoto Protocol on climate change
  2. North American Free Trade Agreement (NAFTA)
  3. General Agreement on Trade in Services (GATS)
  4. Paris Agreement on climate change

Answer: 3. General Agreement on Trade in Services (GATS)

Explanation:

The General Agreement on Trade in Services (GATS) was a significant outcome of the Uruguay Round, which aimed to liberalize trade in services among member countries.

Question 11. The Uruguay Round was a series of negotiations that took place under the auspices of

  1. The United Nations (UN)
  2. The World Bank
  3. The International Monetary Fund (IMF)
  4. The General Agreement on Tariffs and Trade (GATT)

Answer: 4. The General Agreement on Tariffs and Trade (GATT)

Question 12. The Uruguay Round negotiations were initiated in

  1. 1986
  2. 1988
  3. 1990
  4. 1994

Answer: 1. 1986

Question 13. The main objective of the Uruguay Round was to

  1. Reduce agricultural subsidies and support
  2. Restrict the trade of developing countries
  3. Address emerging environmental issues in international trade
  4. Create a more comprehensive and effective international trade agreement

Answer: 4. Create a more comprehensive and effective international trade agreement

Question 14. The Uruguay Round resulted in the establishment of the World Trade Organization (WTO) in

  1. 1986
  2. 1990
  3. 1994
  4. 1995

Answer: 4. 1995

Question 15. The WTO is an international organization that oversees and enforces global trade rules and agreements among its member countries. Its. headquarters are located in

  1. Geneva, Switzerland
  2. New York, USA
  3. Brussels, Belgium
  4. Tokyo, Japan

Answer: 1. Geneva, Switzerland

The World Trade Organization (WTO)

Question 1. What is the World Trade Organization (WTO)?

  1. A global organization that regulates foreign direct investment (FDI)
  2. An intergovernmental organization that promotes regional trade agreements
  3. An international body that oversees and regulates global trade
  4. A group of countries that collaborate to establish a common currency

Answer: 2. An international body that oversees and regulates global trade Explanation:

The World Trade Organization (WTO) is an international body that oversees and regulates global trade and trade-related rules among its member countries.

Question 2. When was the World Trade Organization (WTO) established?

  1. 1947
  2. 1986
  3. 1995
  4. 2001

Answer: 3. 1995

Explanation:

The World Trade Organization (WTO) was established on January 1, 1995, following the conclusion of the Uruguay Round’ of trade negotiations.

Question 3. What is the primary objective of the WTO?

  1. To promote regional economic integration among member countries
  2. To regulate foreign investments and capital flows
  3. To reduce trade barriers and facilitate international trade
  4. To enforce labor and environmental standards in member countries

Answer: 4. To reduce trade barriers and facilitate international trade

Explanation:

The primary objective of the WTO is to reduce trade barriers, such as tariffs and non-tariff barriers, and facilitate international trade among member countries.

Question 4. How does the WTO settle trade disputes between member countries?

  1. Imposing sanctions on non-compliant countries
  2. By conducting independent investigations and trials
  3. Through a dispute settlement mechanism with a panel of experts
  4. By referring disputes to the United Nations (UN) for resolution

Answer: 3. Through a dispute settlement mechanism with a panel of experts

Explanation:

The WTO settles trade disputes between member countries through its Dispute Settlement Mechanism, where panels of experts assess the cases and make recommendations.

Question 5. Which of the following agreements is NOT under the purview of the WTO?

  1. General Agreement on Tariffs and Trade (GATT)
  2. Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS)
  3. Agreement on Agriculture (AoA)
  4. North American Free Trade Agreement (NAFTA)

Answer: 4. North American Free Trade Agreement (NAFT(A)

Explanation:

The North American Free Trade Agreement (NAFTA) was a regional trade agreement between Canada, Mexico, and the United States. It is not under the purview of the WTO.

Question 6. How many member countries are currently part of the World Trade Organization (WTO)?

  1. 77
  2. 164
  3. 216
  4. 305

Answer: 2. 164

Explanation:

As of my last update in September 2021, the World Trade Organization (WTO) had 164 member countries.

Question 7. What is the primary function of the World Trade Organization (WTO)?

  1. To regulate foreign direct investment (FDI) among member nations
  2. To establish common monetary policies among member countries
  3. To promote regional economic integration in Europe
  4. To facilitate trade negotiations and resolve trade disputes among member countries

Answer: 4. To facilitate trade negotiations and resolve trade disputes among member countries

Explanation:

The primary function of the World Trade Organization (WTO) is to provide a platform for member countries to conduct trade negotiations and to resolve trade disputes through its Dispute Settlement Mechanism.

Question 8. Which of the following agreements is NOT administered by the World Trade Organization (WTO)?

  1. General Agreement on Trade in Services (GATS)
  2. Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS)
  3. North American Free Trade Agreement (NAFTA)
  4. Agreement on Agriculture (AoA)

Answer: 3. North American Free Trade Agreement (NAFTA)

Explanation:

The North American Free Trade Agreement (NAFTA) is not administered by the World Trade Organization (WTO). It was a regional trade agreement between Canada, Mexico, and the United States. However, NAFTA was replaced by the United States-Mexico-Canada Agreement (USMCA) in 2020.

Question 9. The World Trade Organization (WTO) is an international organization that deals with the global rules of trade among its member countries. It officially commenced operations on:

  1. January 1, 1995
  2. January 1, 2000
  3. January 1, 1990
  4. January 1, 1985

Answer: 1. January 1, 1995

Question 10. The WTO is headquartered in

  1. Washington, D.C., USA
  2. Brussels, Belgium
  3. Geneva, Switzerland
  4. New York, USA

Answer: 3. Geneva, Switzerland

Question 11. The WTO operates on the principle of, which means that any trade concession granted to one member country should be extended to all member countries.

  1. Most-Favored Nation (MFN)
  2. Free Trade Area (FTA)
  3. Preferential Trade Agreement (PTA)
  4. Customs Union (CU)

Answer: 1. Most-Favored Nation (MFN)

Question 12. The highest decision-making body of the WTO is the Ministerial Conference, which meets at least once every

  1. Two years
  2. Four years
  3. Six years
  4. Eight years

Answer: 1. Two years

Question 13. The WTO has a dispute settlement mechanism that allows member countries to resolve trade disputes in a rules-based manner. If a dispute cannot be resolved through consultations, it may be brought before a panel of experts. The final appellate body for dispute settlement in the WTO is known as the

  1. Dispute Resolution Panel (DRP)
  2. Appellate Body (AB)
  3. Trade Dispute Arbitration Board (TDAB)
  4. Dispute Resolution Court (DRC)

Answer:  2. Appellate Body (AB)

The Structure Of The WTO

Question 1. What is the highest decision-making body of the World Trade Organization (WTO)?

  1. General Council
  2. Ministerial Conference
  3. Appellate Body
  4. Dispute Settlement Body

Answer: 2. Ministerial Conference

Explanation: 

The Ministerial Conference is the highest decision-making body of the World Trade Organization (WTO). It meets at least once every two years.

Question 2. Which of the following is responsible for the daily functioning of the WTO and implementation of decisions?

  1. General Council
  2. Ministerial Conference
  3. Director-General
  4. Dispute Settlement Body

Answer: 3. Director-General

Explanation:

The Director-General is responsible for the daily functioning of the WTO and oversees the implementation of decisions made by the member countries.

Question 3. Which WTO body is responsible for the settlement of disputes between member countries?

  1. General Council
  2. Dispute Settlement Body
  3. Appellate Body
  4. Ministerial Conference

Answer: 2. Dispute Settlement Body

Explanation:

The Dispute Settlement Body (DSB) is responsible for the settlement of disputes between WTO member countries. It is a part of the WTO’s dispute settlement mechanism. •

Question 4. Which WTO body reviews appeals of panel decisions in trade disputes?

  1. General Council
  2. Dispute Settlement Body
  3. Appellate Body
  4. Ministerial Conference.

Answer: 3. Appellate Body

Explanation:

The Appellate Body reviews appeals of panel decisions in trade disputes. It ensures the consistency and fairness of dispute settlement rulings.

Question 5. What is the primary function of the General Council of the WTO?

  1. To administer trade agreements and monitor trade policies of member countries
  2. To oversee the daily functioning of the WTO and resolve budgetary matters
  3. To approve new members’ accession to the WTO
  4. To set the strategic direction and goals for the WTO’s work

Answer: 1. To administer trade agreements and monitor trade policies of member countries

Explanation:

The General Council is responsible for administering trade agreements and monitoring trade policies of member countries. It is the main body that oversees the functioning of the WTO.

The Guiding Principles Of The World Trade Organization (WTO)

Question 1. What are the guiding principles of the World Trade Organization (WTO)?

  1. Protectionism and import substitution
  2. Free trade, non-discrimination, and transparency
  3. Bilateral trade agreements and export-oriented policies
  4. Monetary policy coordination among member countries

Answer: 2. Free trade, non-discrimination, and transparency Explanation:

The guiding principles of the World Trade Organization (WTO) are free trade, non-discrimination, and transparency in trade policies.

Question 2. Which principle of the WTO promotes the removal of trade barriers, such as tariffs and quotas?

  1. Free trade
  2. Non-discrimination
  3. Transparency
  4. Special and differential treatment

Answer: 1. Free trade

Explanation:

The principle of free trade in the WTO promotes the reduction or elimination of trade barriers to facilitate the flow of goods and services.

Question 3. What does the principle of non-discrimination in the WTO entail?

  1. Giving preferential treatment to least-developed countries
  2. Treating foreign and domestic products equally in trade matters
  3. Restricting imports to protect domestic industries
  4. Imposing export tariffs on certain goods

Answer: 2. Treating foreign and domestic products equally in trade matters

Explanation:

The principle of non-discrimination (most-favored-nation and national treatment) in the WTO requires member countries to treat foreign and domestic products and services equally in trade matters.

Question 4. How does the WTO promote transparency in trade policies?

  1. By imposing trade sanctions on non-compliant member countries
  2. By providing financial assistance to developing nations »
  3. By conducting regular trade policy reviews and notifications
  4. By implementing quotas on specific products

Answer: 3. By conducting regular trade policy reviews and notifications

Explanation:

The WTO promotes transparency by conducting regular trade policy reviews and requiring member countries to notify the organization about their trade policies and measures.

Question 5. What is the principle of special and differential treatment in the WTO?

  1. Imposing differential tariffs on imports from different countries
  2. Granting preferential trade agreements to certain member countries
  3. Providing financial aid to least-developed countries for trade-related capacity building
  4. Allowing countries to set their monetary policies independently

Answer: 3. Providing financial aid to least-developed countries for trade-related capacity building

Explanation:

The principle of special and differential treatment in the WTO allows developing and least-developed countries to receive financial and technical assistance for trade-related capacity building and implementation of trade agreements.

The Doha Round

Question 1. What is the Doha Round in the context of international trade?

  1. A series of negotiations to establish a common currency among member countries
  2. A round of trade talks aimed at promoting regional economic integration in Europe
  3. A multilateral trade negotiation under the World Trade Organization (WTO)
  4. A regional trade agreement between South American countries

Answer: 3. A multilateral trade negotiation under the World Trade Organization (WTO)

Explanation:

The Doha Round was a series of multilateral trade negotiations conducted under the World Trade Organization (WTO) from 2001 to 2015.

Question 2. What was the main objective of the Doha Round?

  1. To establish a common monetary policy among member countries
  2. To promote import substitution policies in developing nations
  3. To reduce trade barriers and address the concerns of developing countries
  4. To restrict foreign direct investment (FDI) in developing economies

Answer: 3. To reduce trade barriers and address the concerns of developing countries

Explanation:

The main objective of the Doha Round was to reduce trade barriers and address the concerns of developing countries, particularly in the areas of agriculture, services, and intellectual property.

Question 3. Why was the Doha Round often referred to as the “Development Round”?

  1. Because it focused on increasing foreign aid to developing countries
  2. Because it aimed to promote export-oriented policies in developing economies
  3. Because it emphasized addressing the trade-related needs of developing countries
  4. Because it sought to impose higher tariffs on imports from developing nations

Answer: 3. Because it emphasized addressing the trade-related needs of developing countries

Explanation:

The Doha Round was often referred to as the “Development Round” because it emphasized addressing the trade-related needs of developing countries, such as reducing agricultural subsidies and enhancing market access for their products.

Question 4. What were some of the key issues of contention in the Doha Round negotiations?

  1. Climate change policies and environmental regulations
  2. Immigration and border control measures
  3. Intellectual property rights and access to essential medicines
  4. Currency exchange rates and monetary policies

Answer: 3. Intellectual property rights and access to essential medicines Explanation:

One of the key issues of contention in the Doha Round negotiations was related to intellectual property rights and access to essential medicines, particularly for developing countries.

Question 5. Why did the Doha Round face challenges and delays in reaching a comprehensive agreement?

  1. Due to the lack of interest from developed countries in trade liberalization
  2. Because developing countries were not willing to participate in the negotiations
  3. Due to disagreements among member countries on various trade-related issues
  4. Because the World Trade Organization (WTO) lacked the authority to enforce trade agreements

Answer: 1. Due to disagreements among member countries on various trade-related issues

Explanation:

The Doha Round-faced challenges and delays primarily due to disagreements among member countries on various trade-related issues, including agricultural subsidies, market access, and intellectual property rights.

Question 6. What is the Doha Round in the context of international trade?

  1. A series of negotiations to establish the European Union (EU)
  2. A multilateral agreement to regulate foreign direct investment (FDI)
  3. A round of trade talks under the World Trade Organization (WTO)
  4. A pact between countries within a specific region to facilitate trade and reduce barriers

Answer: 3. A round of trade talks under the World Trade Organization (WTO)

Explanation:

The Doha Round was a series of trade talks conducted under the World Trade Organization (WTO) from 2001 to 2015.

Question 7. What was the main objective of the Doha Round?

  1. To establish a common currency among member countries
  2. To promote regional trade agreements in Asia
  3. To reduce trade barriers and promote development in developing countries
  4. To restrict the movement of labor and capital across borders

Answer: 3. To reduce trade barriers and promote development in developing countries

Explanation:

The main objective of the Doha Round was to reduce trade barriers and promote development in developing countries through various trade agreements. _ • ,

Question 8. The Doha Round negotiations focused on various sectors, including agriculture, services, and

  1. Pharmaceuticals
  2. Information technology
  3. Tourism
  4. Industrial goods

Answer: 4. Industrial goods

Explanation:

The Doha Round negotiations focused on various sectors, including agriculture, services, and industrial goods.

Question 9. Why is the Doha Round often referred to as the “Development Round”?

  1. Because it aimed to promote trade in developing countries
  2. Because it focused on environmental sustainability
  3. Because it aimed to eliminate subsidies in developed countries
  4. Because it focused on reducing income disparities between rich and poor countries

Answer: 1. Because it aimed to promote trade in developing countries

Explanation:

The Doha Round is often referred to as the “Development Round” because it aims to promote trade in developing countries and address their specific concerns.

Question 10. What were some of the challenges that led to the suspension of the Doha Round in 2015?

  1. Lack of interest from developing countries in participating
  2. Disagreements over intellectual property rights and patent regulations
  3. Resistance from developed countries to reduce agricultural subsidies
  4. A focus on bilateral trade agreements instead of multilateral negotiations

Answer: 3. Resistance from developed countries to reduce agricultural subsidies

Explanation:

One of the challenges that led to the suspension of the Doha Round in 2015 was the resistance from developed countries to reduce agricultural subsidies, which was a contentious issue for developing countries.

Question 11. The Doha Round is a series of trade negotiations that were launched under the auspices of the World Trade Organization (WTO) in

  1. 1995
  2. 2001
  3. 2005
  4. 2010

Answer: 2. 2001

Question 12. The main objective of the Doha Round was to

  1. Establish a global currency for all member countries
  2. Focus on environmental and climate change issues related to international trade
  3. Address trade barriers and promote development in developing countries
  4. Create a regional trade agreement between developed countries

Answer: 3. Address trade barriers and promote development in developing countries

Question 13. One of the significant issues of the Doha Round negotiations was related to

  1. Intellectual property rights and copyright protection
  2. Currency exchange rate manipulation
  3. Agricultural subsidies and market access for agricultural products
  4. Environmental standards in manufacturing industries

Answer: 1. Intellectual property rights and copyright protection

Question 14. The Doha Development Agenda (DDA) is a set of trade negotiation goals and objectives specifically aimed at

  1. Promoting trade liberalization among developed countries
  2. Reducing trade barriers for small and medium-sized enterprises (SMEs)
  3. Addressing the trade concerns of developing countries and improving their access to global markets
  4. Expanding trade in the services sector, such as finance and telecommunications

Answer: 3. Expanding trade in the services sector, such as finance and telecommunications

G 20 Economies: Facilitating Trade

Question 1. What is the G20?

  1. An organization of 20 countries focused on facilitating international trade
  2. A group of 20 economies that promote regional economic integration
  3. A forum of major advanced and emerging economies addressing global economic issues.
  4. A trade bloc formed by 20 countries to impose trade restrictions on non-members.

Answer: 3. A forum of major advanced and emerging economies addressing global economic issues

Explanation:

The G20 is a forum of major advanced and emerging economies that come together to discuss and address global economic and financial issues.

Question 2. How can the G20 economies facilitate international trade?

  1. By imposing tariffs and quotas on imports from non-member countries
  2. By implementing trade agreements among member countries.
  3. By fostering economic growth and stability to promote global trade
  4. By providing financial aid to developing countries for trade-related infrastructure

Answer: 3. By fostering economic growth and stability to promote global trade

Explanation:

The G20 economies can facilitate international trade by promoting economic growth and stability, which creates an environment conducive to global trade.

Question 3. Which of the following is NOT a direct role of the G20 in trade facilitation?

  1. Negotiating bilateral trade agreements between member countries
  2. Discussing trade-related issues among member countries
  3. Addressing trade imbalances and protectionist measures
  4. Encouraging the reduction of trade barriers

Answer: 1. Negotiating bilateral trade agreements between member countries

Explanation:

The G20 is not a formal trade negotiation forum for bilateral trade agreements between member countries.

Question 4. How do G20 discussions on global economic issues impact international trade?

  1. They can lead to the formation of regional trade blocs
  2. They may result in the harmonization of trade policies among member countries
  3. They have no direct impact on international trade
  4. They focus solely on monetary policies and do not address trade matters

Answer: 2. They may result in the harmonization of trade policies among member countries

Explanation:

G20 discussions on global economic issues can lead to a better understanding of trade-related challenges, potentially resulting in the harmonization of trade policies among member countries.

Question 5. What is the G20’s stance on protectionism?

  1. The G20 encourages its member countries to embrace protectionist measures to safeguard domestic industries
  2. The G20 supports open markets and rejects protectionism in global trade
  3. The G20 imposes tariffs on goods from non-member countries to protect its economies
  4. The G20 allows its member countries to implement import quotas on specific products

Answer: 2. The G20 supports open markets and rejects protectionism in global trade

Explanation:

The G20 is committed to supporting open markets and rejecting protectionism in global trade to foster economic growth and stability.

Question 6. What is the primary focus of the G20 group of economies?

  1. Facilitating trade negotiations and agreements
  2. Addressing global economic and financial issues
  3. Implementing regional trade blocs
  4. Regulating foreign direct investment (FDI)

Answer: 2. Addressing global economic and financial issues

Explanation:

The G20 group of economies primarily focuses on addressing global economic and financial issues through discussions and cooperation among member countries.

Question 7. The G20 is a group of major advanced and emerging economies that represent the world’s GDP and global trade. 

  1. 20%;50%
  2. 40%;80%
  3. 60%; 90%
  4. 80%; 70%

Answer: 3. 60%; 90%

Question 8. The G20 economies play a significant role in facilitating trade by

  1. Establishing a common currency for all member countries
  2. Imposing higher tariffs on imports from non-member countries
  3. Promoting protectionist trade policies
  4. Cooperating on international trade and economic issues

Answer: 4. Cooperating on international trade and economic issues

Question 9. The G20 economies have held summits since

  1. 1995
  2. 1999
  3. 2001
  4. 2005

Answer: 2. 1999

Question 10. The G20 economies focus on addressing global economic challenges, promoting financial stability, and enhancing cooperation on international trade to foster

  1. Regional trade agreements
  2. Protectionist trade measures
  3. Sustainable and inclusive economic growth
  4. Exchange rate manipulation

Answer: Sustainable and inclusive economic growth

Question 11. One of the key objectives of the G20 economies is to foster open and predictable trade policies that promote

  1. Trade restrictions and barriers
  2. Free trade agreements among member countries
  3. Bilateral trade agreements with non-member countries
  4. Economic growth, job creation, and global prosperity through international trade

Answer: 4. Economic growth, job creation, and global prosperity through international trade

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