International Political Economy: Master the Interplay of Politics and Economics

Question 1

In mercantilist theory, which concept is considered a key indicator of a country's economic strength?

Accepted Answer

The balance of trade measures a country's economic power.

Answer

Free trade benefits all nations.

Answer

The government should not intervene in the economy.

Answer

The aim of international trade is to enhance global well-being.

Question 2

Which limitation of the theory of comparative advantage stems from its disregard for factors beyond price?

Accepted Answer

Ignores non-price factors influencing trade

Answer

Assumes perfect information about production capabilities

Answer

Assumes equal technological development across countries

Answer

Predicts universal welfare gains from free trade

Question 3

Which concept is central to mercantilism, a theory prevalent in the early modern era?

Accepted Answer

The state plays an active role in economic affairs.

Answer

Unrestricted trade leads to economic growth.

Answer

Trade balance is unimportant for economic prosperity.

Answer

Economic growth is the sole goal of governance.

Question 4

Which theory of international trade highlights the influence of technology in shaping trade patterns?

Accepted Answer

Technological gap theory

Answer

Mercantilist theory

Answer

Classical theory

Answer

Dependency theory

Question 5

Which of the following is a defining characteristic of globalization?

Accepted Answer

Enhanced interconnectedness and interdependence

Accepted Answer

Increased movement of goods, services, and capital across borders

Answer

Diminished cultural diversity

Answer

Reduced awareness of global affairs

Question 6

Which theoretical framework is NOT considered a foundational framework in International Political Economy?

Accepted Answer

Social constructivism

Answer

Liberalism

Answer

Realism

Answer

Marxism

Question 7

According to the theory of comparative advantage, how should countries allocate their production resources?

Accepted Answer

Produce goods where they are most efficient and import goods where they are less efficient.

Answer

Produce all goods domestically, regardless of efficiency.

Answer

Produce goods requiring the least resources, even if inefficient.

Answer

Export all goods produced and import all goods consumed.

Question 8

What is the fundamental principle of the mercantilist theory of international trade?

Accepted Answer

Maximizing national wealth through economic policies

Answer

Free trade benefits all nations equally

Answer

Minimizing government intervention in the economy

Answer

The balance of trade is unimportant for economic prosperity

Question 9

Which factor has NOT contributed to the globalization of the world economy?

Accepted Answer

Increase in protectionist policies

Answer

Technological advancements in transportation and communication

Answer

Rise of multinational corporations

Answer

Removal of trade restrictions

Question 10

In mercantilism, a theory of international trade popular in the 16th to 19th centuries, nations focused on specific economic policies to achieve which primary goal?

Accepted Answer

Maximize exports

Answer

Increase imports

Answer

Balance trade perfectly

Answer

Promote overall economic growth

Question 11

Which concept is NOT a key principle of mercantilism?

Accepted Answer

Free trade

Answer

Protectionism

Answer

Bullionism

Answer

Balance of trade

Question 12

In the neo-liberal theory of international trade, what is the recommended role of the state?

Accepted Answer

Provide minimal regulation to allow market forces to operate

Answer

Actively intervene to support domestic industries

Answer

Regulate the economy to ensure fair competition

Answer

Nationalize key industries to control economic growth

Question 13

Which of the following is a fundamental principle of mercantilism?

Accepted Answer

A nation's wealth is measured by its gold and silver reserves.

Accepted Answer

Government support is crucial for shielding domestic industries from foreign competition.

Answer

Free trade is essential for economic growth.

Answer

Economic policies should prioritize societal well-being.

Question 14

In neoliberal theory, which assumption is considered fundamental to international trade?

Accepted Answer

Trade leads to more efficient resource allocation.

Answer

States are the primary actors in international trade.

Answer

Trade always benefits all parties involved.

Answer

Government intervention is essential for effective trade regulation.

Question 15

What is a core principle of the liberal international economic order?

Accepted Answer

Free trade

Answer

Protectionism

Answer

Unilateralism

Answer

Economic autarky

Question 16

In the mercantilist theory of international trade, a country's wealth and power are primarily determined by:

Accepted Answer

Its balance of trade

Answer

Its total GDP

Answer

The size of its military

Answer

Its level of education

Question 17

Which of the following is NOT a fundamental assumption of the realist theory of international relations?

Accepted Answer

Economic interdependence fosters cooperation among states.

Answer

States are the primary actors in the international system.

Answer

States act rationally to increase their power.

Answer

The international system lacks a central authority to enforce rules.

Question 18

Which criticism is commonly raised against economic sanctions?

Accepted Answer

They often fail to achieve their intended objectives.

Answer

They always have negative consequences for the targeted country.

Answer

They are excessively costly and time-consuming to implement.

Answer

They are only effective when imposed by a single country.

Question 19

In the liberal theory of international trade, which concept allows countries to gain mutual benefits from trade?

Accepted Answer

Specialization and comparative advantage

Answer

Government intervention

Answer

State sovereignty

Answer

Absence of international organizations

Question 20

According to mercantilism, what is the primary role of government in trade?

Accepted Answer

Intervening in the economy to protect domestic industries and boost exports

Answer

Promoting free trade and open markets

Answer

Minimizing government involvement in the economy

Answer

Regulating trade to ensure fair competition and consumer protection

Question 21

Which objective is **not** consistent with the theory of mercantilism?

Accepted Answer

Attracting foreign investment

Answer

Promoting exports

Answer

Limiting imports

Answer

Maintaining a positive trade balance

Question 22

Which characteristic is NOT a defining feature of the international monetary system?

Accepted Answer

Absence of international cooperation

Answer

Fixed exchange rates

Answer

Convertibility of currencies

Answer

Regulation of international capital flows

Question 23

Which of the following is **not** a fundamental principle of economic liberalism?

Accepted Answer

Prioritizing social welfare

Answer

Free market principles

Answer

Minimal government intervention

Question 24

Which economist is credited with developing the theory of comparative advantage?

Accepted Answer

David Ricardo

Answer

John Maynard Keynes

Answer

Milton Friedman

Question 25

In mercantilist theory, what is considered a primary measure of a nation's strength and prosperity?

Accepted Answer

Gold reserves

Answer

Gross Domestic Product (GDP)

Answer

Human Development Index (HDI)

Question 26

What was a major factor that contributed to the severity of the 2008 global financial crisis?

Accepted Answer

Insufficient regulation of the financial industry

Answer

Growing economic disparity

Answer

Increased demand for oil

Answer

Natural disasters

Question 27

Which of the following is **not** a primary goal of mercantilism, an economic theory that emphasizes the importance of a nation's economic power?

Accepted Answer

Promote free trade and open markets

Answer

Maximize exports and minimize imports

Answer

Increase domestic production and consumption

Answer

Maintain a positive balance of trade

Question 28

Which assumption is NOT a foundation of the Heckscher-Ohlin model of international trade?

Accepted Answer

Production methods are the same in all countries.

Answer

Countries have different amounts of resources like labor and capital.

Answer

Countries have a comparative advantage in producing certain goods due to differences in resources.

Question 29

How do state interventions in domestic production and trade influence the global economic system?

Accepted Answer

State interventions can affect the competitiveness of domestic industries in international markets.

Answer

State interventions have no impact on the global economy.

Answer

State interventions are solely domestic concerns with no international implications.

Question 30

Which of the following is a key argument in favor of free trade, as per the theory of comparative advantage?

Accepted Answer

Enhanced economic growth through efficient resource allocation

Answer

Equal distribution of wealth across all nations

Answer

Strengthened national security due to reduced economic interdependence

Answer

Elimination of the need for international cooperation and organizations

Question 31

Which of the following is a defining feature of globalization?

Accepted Answer

Enhanced global interconnectedness

Accepted Answer

Diminished barriers to trade and investment

Answer

Widening income disparities between nations

Answer

Escalating environmental degradation

Question 32

Which aspect is NOT a key characteristic of the evolving global economy?

Accepted Answer

Persistent income gaps between developed and developing countries

Answer

Increased interdependence and interconnectedness

Answer

Rise of multinational corporations

Question 33

According to the theory of absolute advantage, countries should specialize in producing and exporting goods where they have a:

Accepted Answer

Lower opportunity cost

Answer

Higher opportunity cost

Answer

Higher comparative advantage

Answer

Lower comparative advantage

Question 34

Economic interdependence is a crucial aspect of international political economy. What is a significant implication of economic interdependence?

Accepted Answer

It increases countries' vulnerability to external economic shocks.

Answer

It decreases the need for cooperation between countries.

Answer

It eliminates the need for international organizations.

Answer

It has no significant impact on international relations.

Question 35

Analyze the impact of non-state actors, including multinational corporations and NGOs, on the global political economy.

Accepted Answer

Multinational corporations and NGOs influence the global economy through their economic power, shaping trade, investment, and resource allocation.

Answer

Non-state actors are primarily tools of state power, with limited independent influence.

Answer

Non-state actors focus on charitable work, with minimal impact on economic and political processes.

Answer

The influence of non-state actors is balanced by nation-states, which maintain control over economic and political affairs.

Question 36

According to the hegemonic stability theory, which factor is crucial for maintaining a stable international economic order?

Accepted Answer

A dominant economic power

Answer

A strong international organization

Answer

A shared system of values

Answer

Minimal government intervention

Question 37

How can trade protectionism potentially affect economic development?

Accepted Answer

Protectionism can have both positive and negative effects on economic development.

Answer

Protectionism always leads to increased economic growth.

Answer

Protectionism always results in economic decline.

Answer

Protectionism has no impact on economic development.

Question 38

How do international trade and investment policies contribute to gender inequalities in the global economy?

Accepted Answer

By failing to address the specific needs and contributions of women.

Answer

By being based on biological differences between men and women.

Answer

By having no significant impact on gender inequalities.

Question 39

Which of the following is NOT a potential benefit of state interventionist policies like infant industry protection and research and development subsidies, which aim to boost economic growth?

Accepted Answer

Increasing government income

Answer

Fostering the growth of emerging industries

Answer

Correcting market inefficiencies

Answer

Promoting technological advancements

Question 40

Which of the following is a significant critique of neoliberal economic policies?

Accepted Answer

They increase inequality

Answer

They promote economic growth

Answer

They reduce poverty

Answer

They enhance environmental protection

Question 41

The concept of 'path dependence' suggests that:

Accepted Answer

Past decisions constrain future choices

Answer

Economic systems are inherently unstable

Answer

International relations are determined by structural factors

Answer

Political institutions can be easily reformed

Question 42

The concept of 'embedded liberalism' suggests that:

Accepted Answer

Economic liberalism coexists with social welfare policies

Answer

Neo-liberalism has completely replaced Keynesian economics

Answer

States have minimal role in economic management

Answer

Global markets are fully self-regulating

Question 43

How have technological advancements influenced global trade patterns, considering the changing dynamics of comparative advantage and the rise of digital trade?

Accepted Answer

Diminished the significance of traditional comparative advantages like natural resources and labor costs.

Answer

Reduced global trade volumes due to increased domestic production capabilities.

Answer

Shifted comparative advantage towards nations with abundant natural resources and cheap labor.

Question 44

Which characteristic is NOT a defining feature of the global political economy?

Accepted Answer

Homogeneity

Answer

Interdependence

Answer

Asymmetry

Answer

Conflict

Question 45

The theory of 'hegemonic stability' suggests that:

Accepted Answer

A dominant power can foster cooperation and stability

Answer

International organizations are vital for maintaining order

Answer

Economic interdependence inherently leads to peaceful relations

Answer

Power transitions are invariably violent

Question 46

Which theoretical framework is central to understanding the relationship between trade and development?

Accepted Answer

Dependency theory

Answer

Modernization theory

Answer

Neoliberal theory

Answer

Realist theory

Question 47

The World Bank and the International Monetary Fund (IMF) are examples of:

Accepted Answer

International financial institutions

Answer

Intergovernmental organizations

Answer

Non-governmental organizations

Answer

Regional organizations

Question 48

According to the 'Washington Consensus', which policy is NOT a key recommendation?

Accepted Answer

Active government intervention

Answer

Fiscal discipline

Answer

Privatization

Answer

Trade liberalization

Question 49

Assess the importance of international cooperation in addressing climate change, considering the challenges of balancing economic growth and environmental sustainability.

Accepted Answer

International cooperation is crucial for mitigating climate change by pooling resources and expertise.

Accepted Answer

International cooperation is vital for adapting to climate change by sharing knowledge and resources.

Accepted Answer

Balancing economic growth and environmental sustainability in climate change mitigation and adaptation requires international cooperation.

Answer

International cooperation is not necessary for addressing climate change, as individual countries can act independently.

Question 50

Which core principle of economic liberalism advocates for the unrestricted flow of goods and services across borders?

Accepted Answer

Unrestricted free trade

Answer

Government intervention in the market

Answer

An extensive social safety net

Answer

Protectionist trade policies

Question 51

The Bretton Woods system aimed to establish a stable international monetary framework by implementing:

Accepted Answer

Fixed exchange rates pegged to the value of gold

Answer

Flexible exchange rates determined by market forces

Answer

A single global currency for all participating countries

Answer

A ban on the use of gold and silver as currency

Question 52

The concept of 'soft power' emphasizes the importance of:

Accepted Answer

Cultural influence

Answer

Military strength

Answer

Economic coercion

Answer

Diplomatic alliances

Question 53

Which of the following is NOT identified as a challenge in global economic governance?

Accepted Answer

National sovereignty

Answer

Climate change

Answer

Tax avoidance by multinational corporations

Answer

Rising inequality

Question 54

The term 'Asian Tigers' refers to the remarkable economic growth achieved by which group of countries?

Accepted Answer

South Korea, Taiwan, Hong Kong, and Singapore

Answer

Japan, China, India, and Indonesia

Answer

Malaysia, Thailand, Vietnam, and the Philippines

Answer

Brunei, Cambodia, Laos, and Myanmar

Question 55

Which entity was responsible for promoting the set of economic policies known as the 'Washington Consensus'?

Accepted Answer

Development agencies like the World Bank and IMF

Answer

The United States government

Answer

The European Union

Answer

The Organisation for Economic Co-operation and Development (OECD)

Question 56

A central argument of neoliberal institutionalism is that:

Accepted Answer

International institutions can influence state preferences

Answer

International cooperation is primarily driven by economic interests

Answer

States remain the dominant actors in international relations

Answer

International norms are largely irrelevant

Question 57

In International Relations, which theory emphasizes the role of economic interdependence in fostering cooperation and reducing conflict?

Accepted Answer

Liberal institutionalism

Answer

Realism

Answer

Constructivism

Answer

Marxism

Question 58

Which international organization is primarily responsible for regulating global trade?

Accepted Answer

World Trade Organization

Answer

United Nations

Answer

World Bank

Answer

International Monetary Fund

Question 59

Which of the following is not a core concept in the study of International Political Economy?

Accepted Answer

Geopolitical tensions

Answer

Power and influence

Answer

Interdependence and globalization

Answer

Sustainable development

Question 60

According to the realist theory of International Political Economy, the primary goal of states is to:

Accepted Answer

Maintain military superiority

Answer

Secure economic prosperity

Answer

Promote global cooperation

Answer

Achieve technological dominance

Question 61

The World Trade Organization (WTO) can be classified as an:

Accepted Answer

Intergovernmental organization

Answer

Non-governmental organization

Answer

International court

Answer

Bilateral agreement

Question 62

Which of the following is a potential downside of economic globalization?

Accepted Answer

Increased inequality

Answer

Increased trade and investment

Answer

Reduced poverty in some regions

Answer

Enhanced technological diffusion

Question 63

In the context of International Political Economy, 'geopolitics' refers to:

Accepted Answer

The influence of geographical factors on political and economic power dynamics

Answer

The analysis of global security issues in the context of geography

Answer

The role of technology in shaping world politics

Answer

The study of international relations from an anthropological perspective

Question 64

According to Liberal IPE theory, what is the primary purpose of international organizations?

Accepted Answer

To promote cooperation and reduce conflict among nations

Answer

To allocate resources for development projects

Answer

To protect state sovereignty unconditionally

Answer

To enforce global regulations universally