Question

1, Production of goods and services has become globalized to a large extent as a result of

a. multinational corporations' efforts to source inputs and locate production anywhere where costs are lower and profits higher.

b. common tastes worldwide for the same goods and services.

c. natural resources being depleted in one country after another.

2, Japan has experienced large trade surpluses. Japanese investors have responded to this by

a. lobbying the U.S. government to depreciate its currency.

b. lobbying the Japanese government to allow the yen to appreciate.

c. investing heavily in U.S. and other foreign financial markets.

d. liquidating their positions in stocks to buy dollar-denominated bonds.

3, During the period of the classical gold standard (1875-1914) there were

a. stable exchange rates.

b. volatile exchange rates.

c. No need for exchange rates because of limited trade.

4, How was the World Bank created?

a. As a result of the Bretton Woods agreement

b. As a result of the Maastrich Treaty

c. As a result of establishment of the Federal Reserve System

d. As a result of the formation of the European Union

Answer 1

1. Production of goods and services has become globalised to a large extent as a result of multinational corporation efforts to source input and locate production anywhere where costs are lower and profits are higher and it can be seen through manufacturing by various United States companies who have their manufacturing plant in China.

Rest of the options are not true as it is not related to common tastes and depletion of natural resource.

Correct answer is option (a).