40+ Introduction to International Trade MCQ | (Free Resource) Business Economics

31. The offer curve of a country is based on _________ .
a) relative prices of two commodities
b) price of exports
c) price of imports
d) supply of exports

32. A country will have unfavourable terms of trade when ________ .
a) imports have inelastic demand
b) imports have elastic demand
c) exports have elastic supply
d) none of the above

33. When supply of exports is elastic, a country will have ________ terms of trade.
a) favourable
b) unfavourable
c) different
d) none of the above

34. The concept of reciprocal demand was introduced by ________ .
a) J. S. Mill
b) J. M. Keynes
c) G. S. Dorrance
d) F.W. Taussig

35. Reciprocal demand is expressed in terms of _________ .
a) Offer curves
b) supply curves
c) demand curves
d) cost curves

36. The classical theory of international trade was presented by __________ .
a) David Ricardo
b) Hecksher-Ohlin
c) J. M. Keynes
d) Alfred Marshall

37. Hecksher-Ohlin theory states that the relative factor prices in two countries are determined by _____ .
a) differences in factor endowments
b) labour efficiency
c) technological developments
d) none of the above

38. Hecksher-Ohlin theory is also known as ________ theory of international trade.
a) modern
b) traditional
c) classical
d) none of the above

39. Under _______ type of cost difference, international trade will not take place.
a) equal
b) absolute
c) comparative
d) none of the above