International Economics (ECST3202)
DIPET 1 in Economics - ECNT
Semester: Resit
Level: 300
Year: 2014
THE UNIVERSITY OF BAME N DA
HIGHER TEACHER TRAINING COLLEGE B A M E N D A - B A M B I L I
RESIT EXAMINATION. INTERNATIONAL ECONOMICS. 2013/2014
Section A 10 marks
1) Briefly explain the following concepts as used in international, economics without graphs:
a) The offer curve
b) Income terms of trade;
c) The balance of trade multiplier
d) The protective effect
e) Consumption optimization in international trade.
Section B
1)
The international Economy is the study of international trade and international relations
2)
The economic interdependence of nations of the world is a result of the development of economic order
3) Major international economic problems include industrial raw materials and Energy
4) The notion of free trade or liberalisation will be supported because different people have different taste for
product.
5) The mercantilist doctrines encouraged exportations and discouraged importations
:
6) “Mercantilism regarded the world economy as static” implies that the world economy was not growing
7) Balance of trade is defined as the net total of a country’s imports and export transaction during a period of one
year
8) David Ricardo’s comparative cost theory was formulated.in 1817
9) Dumping is principally aimed at making the product more competitive in foreign markets
10) A deflationary price change can lead to a balance of payment disequilibrium
11) Taking advantage of factor endowment is a theory founded by Bertil Ohlin.
12) Given that the volume of a country’s exports to the ROW is 1.5 million Fcfa: and she imports a total value of
750 000 Fcfa. The mpc is 0.65 while the marginal propensity to save is 0.15; the impact of this on the balance
of payments of this country is that incomes will increase by 5 million Fcfa
13) The effective rate of a tariff is defined in terms of the nominal value of a tariff.
14) Agricultural subsidies in the West have contributed to poorer terms of trade for Less Developed Countries.
15)
An equilibrium balance of payments implies a state of balance which tends to adjust itself when disturbed.
16)
The demand for foreign exchange is derived demand.
17) Import tariffs have as one of their goals, protecting local firms from international competition. The
effectiveness of this depends on the n om in al tariff rate.
18)
Given a fixed level of welfare the environment will be affected by a favourable terms of trade through
degradation resulting from increased production or exploitation
19)
The importance of the settlement account of a country’s balance of payments statement corrects statistical
discrepancies
20)
In an open economy, the multiplier effect is normally smaller than it is in a closed economy because imports
are constituted of manufactured goods while exports of primary or raw materials
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