Chapter 1 COMMERCE : Trade An Overview — Online MCQ Test
COMMERCE · CLASS 12 INTER II YEAR · Andhra State Board
Practice Chapter 1 COMMERCE : Trade An Overview with a free chapter-wise online MCQ test.
This chapter covers: This chapter covers domestic and international trade types.
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Chapter 1 COMMERCE : Trade An Overview — Important Questions & Answers
What is the primary function of trade in the economic system?
- A. Production of raw materials
- B. Transfer of ownership of goods and services
- C. Regulating government tax policies
- D. Providing manufacturing infrastructure
Answer: B. Transfer of ownership of goods and services
Trade is essentially the buying and selling process that facilitates the transfer of ownership of goods and services from the producer to the consumer.
Trade is essentially the buying and selling process that facilitates the transfer of ownership of goods and services from the producer to the consumer.
Trade that takes place within the geographical boundaries of a country is called:
- A. International Trade
- B. Foreign Trade
- C. Domestic Trade
- D. Global Trade
Answer: C. Domestic Trade
Domestic trade, also known as internal trade, refers to the exchange of goods and services within the political and geographical borders of a single nation.
Domestic trade, also known as internal trade, refers to the exchange of goods and services within the political and geographical borders of a single nation.
Which of the following is NOT a feature of International Trade?
- A. Transactions occur between residents of two or more countries
- B. Involves multiple currencies
- C. Governed by the domestic laws of a single state only
- D. Subject to trade policies and tariffs of participating nations
Answer: C. Governed by the domestic laws of a single state only
International trade is governed by international agreements and the laws of the participating countries, not just the domestic laws of one state.
International trade is governed by international agreements and the laws of the participating countries, not just the domestic laws of one state.
Comparing domestic trade and international trade, which factor is unique to international trade?
- A. The need for transportation
- B. The involvement of buyers and sellers
- C. Exchange rate fluctuations
- D. The requirement of storage facilities
Answer: C. Exchange rate fluctuations
Exchange rate fluctuations are a unique risk and factor in international trade, as different countries use different currencies.
Exchange rate fluctuations are a unique risk and factor in international trade, as different countries use different currencies.
Which of the following correctly describes a 'Trade Bloc' in international commerce?
- A. An agreement between two individuals in the same city.
- B. A group of countries that have agreed to reduce or eliminate trade barriers among them.
- C. A document issued by a bank to guarantee payment.
- D. A warehouse used for storing domestic goods only.
Answer: B. A group of countries that have agreed to reduce or eliminate trade barriers among them.
A trade bloc is an intergovernmental agreement where participating countries reduce trade barriers like tariffs to encourage regional trade.
A trade bloc is an intergovernmental agreement where participating countries reduce trade barriers like tariffs to encourage regional trade.