This post covers top 50 International Trade MCQ with answers. These updated MCQs will definitely help MBA, BBA, B Com, M Com, MMS, PGDM, and International Business specialization students.
These International Trade multiple choice questions can be used for NET, SET, PH. D., and other competitive entrance exams. These MCQs cover MCQ on sub-topics like foreign trade, multinational trade, or global trade.
MCQ on Introduction to International Trade
International trade contributes and increases the world _________
A. Population
B. Inflation
C. Economy
D. Trade Barriers
View Answer
C. Economy
The ratio of trade to GDP was as high as _________ in 1913.
A. 22.1
B. 11.2
C. 26.3
D. 33.2
View Answer
A. 22.1
Free international trade maximizes world output through________.
A. Countries reducing various taxes imposed.
B. Countries specializing in production of goods they are best suited for.
C. Perfect competition between countries and other special regions
D. The diluting the international business laws & conditions between countries.
View Answer
B. Countries specializing in production of goods they are best suited for.
Domestic company limits it’s operations to ___________ political boundaries.
A. International
B. National
C. Transnational
D. Global
View Answer
B. National
Trade between two or more than two countries is known as ________.
A. Internal Business
B. External Trade
C. International Trade
D. Unilateral Trade
View Answer
C. International Trade
_____refers to the tax imposed on imports.
A. Imported Tax
B. Tariffs
C. Subsidies
D. Import Quotas
View Answer
B. Tariffs
_____ means selling the products at a price less than on going price in the market.
A. Quota
B. Tariff
C. Subsidy
D. Dumping
View Answer
D. Dumping
_______is the oldest International Trade theory.
A. Country Similarity Theory
B. Theory of Absolute Cost advantage
C. Product Life Cycle Theory
D. Mercantilism Theory
View Answer
D. Mercantilism Theory
A voluntary export restraint is the opposite form of _____.
A. Import quotas
B. International tariffs
C. Subsidies
D. Dumping
View Answer
A. Import quotas
The international trade between ___________ is like a vast game of beggar my neighbor.
A. Exporter & Importer
B. Two Countries
C. Two world wars
D. Country’s allies and enemies
View Answer
C. Two world wars
_____ provided a series of ’rounds’ of negotiations by which tariffs were reduced.
A. IMF
B. NAFTA
C. IBRD
D. GATT
View Answer
D. GATT
______ happens when Imports are more than exports.
A. Trade barrier
B. Trade deficit
C. Trade surplus
D. Trade contract
View Answer
B. Trade deficit
______ happens when Exports are more than imports.
A. Trade barrier
B. Trade deficit
C. Trade surplus
D. Trade contract
View Answer
C. Trade surplus
BOP stands for ________.
A. Bank of Payments
B. Barrier of Payments
C. Bill of Payments
D. Balance of Payments
View Answer
D. Balance of Payments
The ________ is composed of capital account and current account.
A. Bill of credit
B. Barrier of Payments
C. Bill of Payments
D. Balance of Payments
View Answer
D. Balance of Payments
The full form of UNCTAD is ______
A. United Nations Conference on Tariff and Duties
B. United Nations Committee on Trade and Development
C. United Nations Conference on Trade and Development
D. United Nations Council on Tariff and Development
View Answer
C. United Nations Conference on Trade and Development
MCQs on International Trade Blocks
____ is a group of countries agree to abolish all trade restrictionsand barriers.
A. Common market
B. Economic Union
C. Custom Union
D. Free Trade Area
View Answer
D. Free Trade Area
EU stands for _____
A. Export Union
B. European Union
C. EXIM Union
D. Export Unit
View Answer
B. European Union
The abbreviation SAARC stands for _______
A. South American Association for Regional Cooperation
B. South African Association for Regional Cooperation
C. South ASEAN Association for Regional Cooperation
D. South Asian Association for Regional Cooperation
View Answer
D. South Asian Association for Regional Cooperation
The full form of WTO is __________
A. World Tariff Organization
B. World Trade Organization
C. Western Trade Organization
D. World Transport Organization
View Answer
B. World Trade Organization
________was replaced by WTO on January 1, 1995.
A. NAFTA
B. IMF
C. IRDB
D. GATT
View Answer
D. GATT
In International Trade, Full form of NAFTA is ___________.
A. National American Free Trade Agreement
B. North Asian Free Trade Agreement
C. New Anti-Tariff Free Trade Agreement
D. North American Free Trade Agreement
View Answer
D. North American Free Trade Agreement
AFTA is ___________.
A. ASEAN Free Trade Area
B. American Free Trade Area
C. Asian Free Trade Area
D. Agreement for Free Trade Area
View Answer
A. ASEAN Free Trade Area
ASEAN stands for ___________.
A. The Association of Southeast American Nations
B. The Association of Southeast Asian Nations
C. The Agreement of Southeast American Nations
D. The Agreement of Southeast Asian Nations
View Answer
B. The Association of Southeast Asian Nations
__________was established by a multilateral treaty of 23 countries in 1947.
A. WTO
B. UN
C. GATT
D. NAFTA
View Answer
C. GATT (The General Agreement on Tariffs and Trade)
In International Trade, IMF stands for ___________.
A. International Monetary Fund
B. International Money Fund
C. International Market Fund
D. International Monetary Firm
View Answer
A. International Monetary Fund
MCQs On Foreign Trade
An import tariff is a tax or duty levied on ___________ commodities.
A. Imported
B. Exported
C. Transported
D. Both A & B
View Answer
A. Imported
An _____________ is a tax or duty levied on exported commodities.
A. Import Tariff
B. Export Tariff
C. Transport Tariff
D. Free Trade Tariff (FTT)
View Answer
B. Export Tariff
__________refers to purchase of goods from a foreign country.
A. Foreign Trade
B. Export Trade
C. Import Trade
D. EXIM Trade
View Answer
C. Import Trade
_______is a fixed percentage on the value of the traded commodity.
A. Anti dumping duty
B. Specific tariff
C. Ad Valorem tariff
D. A compound tariff
View Answer
C. Ad Valorem tariff
In most countries, foreign trade represents a significant share of ______
A. EXIM
B. FDI
C. Income Per Capita
D. GDP
View Answer
D. GDP
Cash grants, loans at low rate and tax holidays are examples of ______.
A. Quotas
B. Tarifs
C. Subsidies
D. Discounts
View Answer
C. Subsidies
_________refers to the sale of goods to a foreign country.
A. Foreign Trade
B. Export Trade
C. Import Trade
D. EXIM Trade
View Answer
B. Export Trade
________is a combination of an ad valorem and specific tariff.
A. Anti dumping tariff
B. Specified Valorem Tariff
C. EXIM Tariff
D. A compound tariff
View Answer
D. A compound tariff
Foreign trade is an exchange of capital, goods, and services across _________ borders or territories
A. Intranational
B. National
C. International
D. Both A & C
View Answer
C. International
_______ refers to goods imported from one country and are exported to another country.
A. Third Party Trade
B. Entrepot trade
C. Export Trade
D. EXIM Trade
View Answer
B. Entrepot trade
Multiple Choice Questions on International Trade Theory
__________ try to explain why trade takes place between countries.
A. International Trade Firms
B. International Trade Theories
C. International Trade Blocks
D. IBRD
View Answer
B. International Trade Theories
Trade theories are classified into ______ trade theories and modern trade theories.
A. Regional
B. Classical
C. Local
D. Ancient
View Answer
B. Classical
_____ is the oldest trade theory.
A. Comparative Cost Advantage Theory
B. Hecksher Ohlin Theory
C. Product Life Cycle Theory
D. Theory of mercantilism
View Answer
D. Theory of mercantilism
_______ argues that countries enter into trade to earn gold and silver,
A. Theory of mercantilism
B. Theory of absolute advantage
C. Product Life Cycle Theory
D. Hecksher Ohlin Theory
View Answer
A. Theory of mercantilism
______ suggests that each country should specialize in producing only those goods which it can produce efficiently.
A. Theory of mercantilism
B. Theory of absolute advantage
C. Product Life Cycle Theory
D. Hecksher Ohlin Theory
View Answer
B. Theory of absolute advantage
Theory of absolute advantage is propagated by ______.
A. Philip Kotler
B. Adam Smith
C. Peter Drucker
D. David Ricardo
View Answer
B. Adam Smith
Theory of comparative advantage was given by ______
A. Philip Kotler
B. Adam Smith
C. Peter Drucker
D. David Ricardo
View Answer
D. David Ricardo
_________ stresses on the ‘relative cost difference’ rather than ‘absolute cost difference’ between the goods as the basis for carrying out trade.
A. Theory of absolute advantage
B. Theory of comparative advantage
C. Hecksher Ohlin Theory
D. Theory of mercantilism
View Answer
B. Theory of comparative advantage
Factor endowments theory of international trade is also known as _______
A. Theory of absolute advantage
B. Theory of comparative advantage
C. Hecksher Ohlin Theory
D. Theory of mercantilism
View Answer
C. Hecksher Ohlin Theory
________ advocates that a country should focus and specialize in the production of goods that it can produce relatively at a lower cost than other countries.
A. Theory of absolute advantage
B. Theory of comparative advantage
C. Hecksher Ohlin Theory
D. Theory of mercantilism
View Answer
B. Theory of comparative advantage
______ explains that the countries acquire comparative advantages due to differences in the national factor endowments like land, labour and capital.
A. Theory of absolute advantage
B. Theory of comparative advantage
C. Hecksher Ohlin Theory
D. Theory of mercantilism
View Answer
C. Hecksher Ohlin Theory
International product life cycle theory was given by ______.
A. Raymond Vernon
B. David Ricardo
C. Michael Porter
D. Adam Smith
View Answer
A. Raymond Vernon
National competitive advantage also called as_____.
A. Gold Model
B. Silver Model
C. Diamond Model
D. Platinum Model
View Answer
C. Diamond Model
According to ‘New Trade Theory’ a firm acquires export competitiveness due to _______.
A. Specialization and economies of scale
B. Being the first mover in the market
C. Government support
D. All of the above
View Answer
D. All of the above
National competitive advantage theory of international trade was given by_____
A. Raymond Vernon
B. David Ricardo
C. Michael Porter
D. Adam Smith
View Answer
A. Raymond Vernon
This is all about MCQ on International Trade with solutions.
You’ll also like to READ: