International trade and Finance Multiple Choice Questions with Answers Pdf: 

1. Which of the following is international trade_________

(1) Trade between provinces 

(2) Trade between regions

(3) Trade between countries 

(4) None of these 

Answer: 3

2. Who regulates foreign trade in India?

(1) World Trade Organisation (WTO)

(2) Indian Trade Organization ( ITO

(3) Both 

(4) None of these 

Answer: 1

3. Which one is the oldest International Trade theory?

(1) Mercantilism Theory 

(2) Classical Theory of trade 

(3) Modern Theory of trade 

(4) New Theories of trade

Answer: 1

4. What was the first economic theory of international trade to be developed?

(1) the theory of mercantilism

(2) the theory of comparative advantage

(3) the theory of absolute advantage

(4) the heckscher-ohlin theory

Answer: 1

5. International Trade is most likely to generate short-term unemployment in____________

(1) industries in which there are neither imports nor exports

(2) import-competing industries

(3) industries that sell to domestic and foreign buyers.

(4) industries that sell to only foreign buyers

Answer: 2

6. Which of the following is not a type of direct foreign investment?

(1) Franchising

(2) International trade

(3) Joint ventures

(4) Acquisitions of existing operations

Answer: 2

7. International trade forces domestic firms to become more competitive in terms of___________

(1) the introduction of new products

(2) product design and quality

(3) product price

(4) all of the above

Answer: 4

8. The following factor does not differentiate international business from domestic business___________

(1) different currencies

(2) product quality

(3) product mobility

(4) trade policies

Answer: B

9. International trade and domestic trade differ because of_________

(1) Different government policies

(2) Immobility of factors

(3) Trade restrictions

(4) All of the above

Answer: 4

10. What are the factors differentiating internal and international trade?

(1) Immobility of Factors of Production

(2) Different Currencies

(3) Restrictions on Trade

(4) All of these 

Answer: 4

11. What are the factors of internal trade?

(1) endowments and productivity, 

(2) trade policy and exchange rates, 

(3) foreign currency reserves, 

(4) inflation, and demand.

(5) All of these 

Answer: 5

12. What are international factors?

(1) movements of labor, 

(2) capital, 

(3) factors of production between countries. 

(4) All of these 

Answer: 4

13. Which of the following is not a benefit of international trade?

(1) lower domestic prices.

(2) development of more efficient methods and new products

(3) greater range of consumption choices

(4) unwelcome political compromises

Answer: 4

14. Which of the following are elements of international trade?

(1) Balance of payments 

(2) Visible trade 

(3) Invisible trade 

(4) Correcting a deficit 

(5) All of these 

Answer: 5

15. What are the benefits of international trade?

(1) Easier cash-flow management.

(2) Better risk management. 

(3) Benefiting from currency exchange

(4) All of these 

Answer: 4

16. What Are the Advantages of International Trade?

(1) Increased revenues. 

(2) Decreased competition. 

(3) Longer product lifespan.

(4) All of these 

Answer: 4