Chapter 8: International Trade — Online MCQ Test
COMMERCE · CLASS 12 INTERMEDIATE 2 YEAR · Telangana State Board
Practice Chapter 8: International Trade with a free chapter-wise online MCQ test.
This chapter covers: This chapter details international business importance export import procedures documentation foreign trade promotion measures and World Trade Organization WTO objectives..
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Chapter 8: International Trade — Important Questions & Answers
Which of the following is a major reason for international trade?
- A. Availability of all resources in one country
- B. Differences in natural resources and climate among countries
- C. Elimination of competition in domestic markets
- D. Restriction of consumer choice
Answer: B. Differences in natural resources and climate among countries
Countries engage in international trade because no country has all resources in sufficient quantity. Differences in climate, resources, and technology encourage trade.
Countries engage in international trade because no country has all resources in sufficient quantity. Differences in climate, resources, and technology encourage trade.
The document issued by the exporter to the importer showing details of goods, quantity, price, and terms of sale is called:
- A. Invoice
- B. Bill of entry
- C. Certificate of origin
- D. Letter of credit
Answer: A. Invoice
An invoice is the basic commercial document prepared by the exporter. It contains the details of goods and the amount payable by the importer.
An invoice is the basic commercial document prepared by the exporter. It contains the details of goods and the amount payable by the importer.
A company wants to export its goods. Which of the following is generally the first step in the export procedure?
- A. Receiving payment from the importer
- B. Obtaining an export licence and registration
- C. Submitting bill of lading to customs
- D. Clearing goods at the importer’s port
Answer: B. Obtaining an export licence and registration
Before exporting, a firm must complete basic registration and licensing formalities. This enables the exporter to legally conduct foreign trade.
Before exporting, a firm must complete basic registration and licensing formalities. This enables the exporter to legally conduct foreign trade.
Why is foreign trade considered an engine of economic growth?
- A. It reduces specialization among countries
- B. It helps countries use resources efficiently and expands markets
- C. It eliminates the need for domestic production
- D. It prevents technology transfer
Answer: B. It helps countries use resources efficiently and expands markets
Foreign trade enables countries to specialize in producing goods they can make efficiently. It also creates larger markets and encourages growth.
Foreign trade enables countries to specialize in producing goods they can make efficiently. It also creates larger markets and encourages growth.
Which of the following is the most appropriate difference between bill of lading and bill of exchange?
- A. Bill of lading is a transport document, while bill of exchange is a negotiable financial instrument
- B. Bill of lading is a payment document, while bill of exchange is a packing document
- C. Both are purely customs documents
- D. Bill of exchange is issued by the shipping company, while bill of lading is issued by the buyer
Answer: A. Bill of lading is a transport document, while bill of exchange is a negotiable financial instrument
A bill of lading relates to carriage and receipt of goods, whereas a bill of exchange is used for payment arrangements in trade. They serve different purposes in international transactions.
A bill of lading relates to carriage and receipt of goods, whereas a bill of exchange is used for payment arrangements in trade. They serve different purposes in international transactions.