Multiple Choice Questions and Answers (MCQs) on Regional Trade Agreement For Civil Services
Question 1 : Which of the following statements is correct in respect of trade creation?
a) Trade creation means preference to products of trading partner nations.
b) Trade creation means preference to international goods in comparison to domestic goods.
c) Trade creation is possible in goods but not in services.
d) Trade creation means preference to efficient source of supply.
Answer : d
Question 2 : How is common market different from custom union?
a) A common market provides for freedom of movement to labour and capital.
b) A common market provides for common economic policies among member nations of an agreement.
c) A common market requires members to adher to common monetary and fiscal standards.
d) None of the above.
Answer : a
Question 3 : Consider the following statements about CECA and CEPA:
- CECA is a wider term than CEPA because it may involve trade in services and investment as well.
- Usually, countries enter into CEPA first then enter into CECA.
Which of the statements given above is/are correct ?
a) 1 only
b) 2 only
c) Both 1 and 2
d) Neither 1 nor 2
Answer : d
Question 4 : Which of the following can be the consequence of a regional trade agreement?
- Loss of custom duty
- Increase in competition
- Larger choices for consumers
Select the correct answer using the codes given below :
a) 1 and 2 only
b) 2 and 3 only
c) 1 and 3 only
d) 1, 2, and 3
Answer : d
Question 5 : Consider the following statements:
- India is not part of any customs union.
- The only free trade agreement of India with a developed country is with Japan.
- India has a free trade agreement with European Union.
Select the correct answer using the codes given below :
a) 1 and 2 only
b) 2 and 3 only
c) 1 and 3 only
d) 1, 2, and 3
Answer : a