Introduction to Global Economic & political Systems: Meaning of Global Economy and its History Structure and Components of Global Economy, Theory of Hegemonic Stability, Differences among National Economies, Market Oriented Capitalism, Developmental Capitalism, Social Market Capitalism, Comparative Analysis, Effects of Globalization on Indian Economy. (6) 2. The Trading System: Debate over Free Trade – Functions of GATT and WTO, The Uruguay Round and World Trade Organization, Trade Blocs – EU, OECD, OPEC, SAARC, ASEAN, NAFTA, Threats to Open Trading System, Developments in International Trade Theory, Bi-lateral, Multilateral Trade Agreements, Impact of Trade wars in liberalized economy. (6

1. 208 GWES
MCQ

2. What is the amalgamation and rapid
unification between countries identified
as?
A) Globalisation
B) Liberalisation
C) Socialisation
D) Privatisation
Answer:A) Globalisation

3. • Globalisation has improved the living
structure of which of the following?
• A) All the people
• B) People living in developing countries
• C) People living in developed countries
• D) None of the above
Answer:B) People living in developing
countries

4. • Which of these organisations
emphasises on the liberalisation of
foreign investment and foreign trade?
• A) International Monetary Fund
• B) World Health Organisation
• C) World Trade Organisation
• D) International Labour Organisation
Answer:C) World Trade Organisation

5. • Tax on imports is considered as an
example of
• A) Collateral
• B) Trade barriers
• C) Foreign trade
• D) Terms of trade
Answer:B) Trade barriers

6. Which of the following is the main reason
behind the investments of MNCs?
A) To benefit foreign countries
B) To provide financial support to the country’s
government
C) For the welfare of underprivileged people
D) To increase the assets and earn profits
Answer:D) To increase the assets and earn
profits

7. • Which of these institutes supports
investments and foreign trade in India?
• A) International Monetary Fund (IMF)
• B) World Trade Organisation (WTO)
• C) World Bank
• D) International Labour Organisation (ILO)
Answer:B) World Trade Organisation (WTO)

8. • When did the government remove the
barriers for investment in India?
• A) 1990
• B) 1991
• C) 1992
• D) 1993
Answer:B) 1991

9. • The first phase of globalization started
around 1870 and ended with …..
• a. World War I
• b. World War II
• c. The Establishment of GATT
• d. In 1913 when GDP was High
Answer:a. World War I

10. Which is the right sequence of stages of
Internationalization
a. Domestic, Transnational, Global, International,
Multinational
b. Domestic, International, Multinational, Global,
Transnational
c. Domestic, Multinational, International,
Transnational, Global
d. Domestic, International, Transnational,
Multinational, Global
Answer:b. Domestic, International,
Multinational, Global, Transnational

11. • Subsidiaries consider the regional
environment for policy / Strategy
formulation is known as
• a. Polycentric Approach
• b. Regiocentric Approach
• c. Ethnocentric Approach
• d. Geocentric Approach
Answer:b. Regiocentric Approach

12. The term global politics:
a. undervalues models of decision makers at the national
level.
b. is conceptually more inclusive of all kinds of actors than
other terms, such as international politics.
c. is the only term that captures the moment of time that is
not epiphenomenal.
d. forces a person to have an overly narrow definition of
politics.
Answer: b. is conceptually more inclusive of
all kinds of actors than other terms, such
as international politics.

13. Nation-state is a problematic term because:
a. few states are composed of one nation, so the term is
confusing at times.
b. all territorial units called “countries” are composed of
only one nation, so the term is unnecessary.
c. globalization has eroded all sense of national identity as
the Waltzer quote that opened Chapter 1 indicates.
d. in the contemporary era no elected official ever uses the
term, yet it lives on in textbooks.
Answer: a. few states are composed of one
nation, so the term is confusing at times.

14. The arena with no overarching central authority
above the individual collection of sovereign states
within which international politics takes place is
known as:
a. anarchy.
b. political community.
c. international system.
d. sovereignty.
Answer: a. anarchy.

15. Classical realism represents power politics as
a result of:
a. international relations.
b. state sovereignty.
c. human behavior.
d. anarchy.
Answer: c. human behavior.

16. The realist argument that maintains
international economic order is dependent
on the existence of a dominant state is
known as:
a. dependency theory.
b. liberal economic theory.
c. game theory.
d. hegemonic stability theory.
Answer: d. hegemonic stability theory.

17. Liberalism is a theory of both:
a. freedom and authority.
b. government within states and good
governance between them.
c. sovereignty and equality.
d. tolerance and balance of power.
Answer: b. government within states and
good governance between them.

18. Marxists see globalization as:
a) An anomaly in the history of the
development of capitalism.
b) Part of long-term trends in the development
of capitalism.
c) Something to be prevented.
d) All of the options given are correct.
Answer:b) Part of long-term trends in the
development of capitalism.

19. 'Harmony of Interests' is the idea that:
a) The natural order between peoples has been corrupted by
undemocratic state leaders and outdated policies such as the balance
of power. Without these distortions there would be no 'real' conflict
between people.
b) The natural order between peoples has been corrupted by
undemocratic state leaders and outdated policies such as the balance
of power. Without these distortions the conflict between people would
be of a different nature.
c) The natural order between peoples has been corrupted by Marxism,
without which there would be no 'real' conflict between people.
d) The natural order between peoples can only exist if they have the same
interests.
Answer:a) The natural order between peoples has been corrupted by
undemocratic state leaders and outdated policies such as the
balance of power. Without these distortions there would be no 'real'
conflict between people

20. • World Trade Organisation came into force
on _______
• A. 27th July 2007
• B. 1st January 1995
• C. 15th September 1993
• D. 1st January 1947
Answer:B. 1st January 1995

21. _______countries were members of WTO as
on 1st January 1995.
A. 151
B. 164
C. 104
D. 139
Answer:C. 104

22. Which of the following resulted from the Great
Depression?
a) Increased trade barriers and devalued currencies.
b) A stable exchange rate system.
c) Free international capital flows.
d) None of the options given is correct.
Answer: a) Increased trade barriers and devalued currencies.
Feedback:
While each of the countries involved in the Great Depression believed
that by increasing trade barriers and devaluating currencies it could
manage to keep its economy afloat, the Great Depression demonstrated
that this did not work.

23. What is the main role of the IMF?
a) To ensure a stable exchange rate regime and provide
emergency assistance to countries facing crises in balance
of payments.
b) To be a forum for trade and liberalization.
c) To assist countries in development.
d) To facilitate private investment around the world.
Answer: a) To ensure a stable exchange rate regime and provide
emergency assistance to countries facing crises in balance of
payments.
Feedback:
The IMF was created to promote international monetary cooperation
and resolve the inter-war problems of the Great Depression. The main
goals are stable exchange rates and one of the main tools is the
provision of emergency assistances to countries facing serious
challenges in their balance of payment.

24. What is the main role of the World Bank?
a) To be a forum for trade and liberalization.
b) To assist countries in development.
c) To facilitate private investment around the world.
d) All of the options given are correct.
Answer: b) To assist countries in development.
Feedback:
What we now call the World Bank started as the
International Bank for Reconstruction and Development and
has since become the world's largest source of development
assistance, providing nearly $16 billion in loans annually.

25. What is meant by the 'Washington Consensus'?
a) The consensus in Washington about matters of foreign
policy.
b) The ten-point guideline to liberal economic reform for
development around the world.
c) The ten-point guideline for economic growth in Europe.
d) The ten-point neo-liberal guideline for progress in the US.
Answer: b) The ten-point guideline to liberal economic reform for
development around the world.
Feedback:
The term 'Washington consensus' originally referred to a set of policy
advice on liberal economic reform being addressed by the Washington-
based institutions to Latin America, and nowadays is often used
interchangeably with the phrase American 'neo-liberal policies'.

26. Why do states undertake protectionist measures?
a) To assist private investment.
b) To keep competitive foreign goods from flooding
the market.
c) To keep stable exchange rates.
d) All of the options given are correct.
Answer: Answer: b) To keep competitive foreign goods from
flooding the market.
Feedback:
When using protectionist measures, states try to 'shield' their
internal production, and hence domestic business and
employment, from international competition.

27. What does structural adjustment involve?
a) Measures to reduce inflation.
b) Measures to curb government expenditure.
c) Deregulation.
d) All of the options given are correct
Answer: Answer: d) All of the options given are correct
Feedback:
The term 'structural adjustment' is usually used when
referring to the IMF's policy towards indebted countries.
Structural adjustments mean immediate measures to reduce
inflation and more broadly the correction of the role of the
government in the economy.

28. What is the mercantilist view of IPE?
a) The world economy is where states seek to maximize their wealth and
independence relative to other states.
b) The world economy is an arena of capitalist competition in which social
groups are always in conflict.
c) Free trade and free movement of capital shape the policies of
governments and economic actors.
d) None of the options given are correct.
Answer: Answer: a) The world economy is where states
seek to maximize their wealth and independence relative to
other states.
Feedback:
The mercantilist tradition stands in stark contrast to a liberal
perception. As mercantilists share the presumptions of
realists in international politics, states will attempt to ensure
their self-sufficiency and hence their relative strength and
power in key strategic industries and commodities.

29. What is Dependency Theory?
a) Economic activity in the richer countries often leads to
serious economic problems in the poorer countries.
b) Economic development of poorer countries is positively
dependent on economic growth of richer countries.
c) Economic growth is beneficial to all.
d) None of the options given are correct.
Answer: a) Economic activity in the richer countries often
leads to serious economic problems in the poorer countries.
Feedback:
Dependency Theory is part of the Marxist tradition in IPE
and has traditionally focused on Latin America to explain
how underdevelopment and poverty is caused by economic,
social, and political structures in the core countries and the
type of exchange this is generating.

30. Under what conditions will states create international
institutions?
a) For mutual gains.
b) Only where position relative to other states is not affected.
c) They arise as reflections of identities and interest of states
and groups which are themselves forged through
interactions.
d) Depends on the school of thought.
Answer: d) Depends on the school of thought.
Feedback:
Competing accounts of institutions will make different statements about
the possibility and probability of cooperative behaviour and institution
building. Institutionalism emphasizes the role of institutions in achieving
absolute gains whereas realists argue that institutions will only be
created when dominant states wish to do so.

31. __________ became the 164th member of
World Trade Organization (WTO).
A. Kenya
B. Liberia
C. Pakistan
D. Afghanistan
Answer:D. Afghanistan

32. WTO is a ________
A. Permanent Institution
B. Multilateral Agreement
C. Multilateral Instrument
D. Provisional Institution
Answer:A. Permanent Institution

33. TRIP stands for ______
A. Tourism-Related Intellectual Property
B. Trade-Related International Property
C. Tariff-related Intellectual Property
D. Trade-Related Intellectual Property
Answer:D. Trade-Related Intellectual
Property

34. • India is set to withdraw MFN status to which
country?
• a. Pakistan
• b. Afghanistan
• c. Bangladesh
• d. China
Answer:a. Pakistan

35. India is set to pitch for a strong TFA in
services at WTO. What does TFA stand for?
a. Trade Facilitation Agreement
b. Trade Formation Agreement
c. Trading Formation Agreement
d. Trading Facilitation Agreement
Answer:a. Trade Facilitation Agreement

36. The Organisation for Economic Co-operation and
Development (OECD)
a. Gathers and publishes data on the international
economy.
b. Provides financial assistance to developing
countries.
c. Approves international standards and product
regulations.
d. Includes more developing countries than
developed countries.
Answer:a. Gathers and publishes data on the
international economy.

37. Which of the following exceptions in the WTO
rules does not permit a country to
use a tariff or quota that is more restrictive
than its bound tariff?
a. Anti-dumping
b. Countervailing duties
c. Safeguards
d. Preferential trade agreements
Answer:d. Preferential trade agreements

38. The “principal supplier” and “principal demander” are the
a. Countries that negotiate tariff reductions on a particular
product in a trade round.
b. Sources of the MFN and National Treatment cornerstones
of the GATT.
c. Members of a dispute settlement panel that argue for and
against the defendant.
d. Points at which supply and demand curves cross the axes.
Answer:a. Countries that negotiate tariff
reductions on a particular product in a
trade round.

39. WTO comes as the third economic pillar of world-
wide dimensions along with the World Bank and
___________?
A International Monetary Funds (IMF)
B international Economic Association (IEA)
C International Funding Organisation (IFO)
D International Development Bank (IDB)
Answer:A International Monetary Funds
(IMF)

40. European Union is a
a) International Organization
b) Relational Organization
c) Supra-National Organization
d) National Organization
Answer:c) Supra-National Organization

41. Arrange the following treaties that are responsible for the
formation of EU in order establishment.
1. Treaty of Paris
2. Treaty of Rome
3. Treaty of Maastricht
4. Treaty of Lisbon Codes
a) 1 , 2 , 3 , 4
b) 4 , 3 , 2 , 1
c) 3 , 2 , 1 ,4
d) 2,1,3,4
Answer:a) 1 , 2 , 3 , 4

42. India's position in SAARC family is unique in terms of
1. Area wise
2. Resource wise
3. Population wise
4. Power-wise
Codes
a) 1 and 2
b) 1 , 2 and 3
c) Only 2
d) All of these
Answer:b) 1 , 2 and 3

43. The ASEAN Was Formed To Promote
a) Social & Cultural Cooperation
b) Economic Cooperation
c) Regional Cooperation
d) All of the above
Answer:d) All of the above

44. OPEC has been called a cartel, because its
members seem to
a) Not allow any new members in
b) Extract the commodity in very small amounts
c) Aim to increase profits through restrictive
measures
d) Ship the commodity exclusively on partnerships
Answer:c) Aim to increase profits through
restrictive measures

45. International economic regulation operates on
two levels. Which are they?
a) Political and economic
b) Unipolar and multipolar
c) Regional and global
d) Financial and political
Answer:c) Regional and global

46. What is the full form of ASEAN?
(a) Association of South East Asian Nations
(b) Administration of Southern East Asian Nations
(c) Organisation of South East Asian Nations
(d) Administration of South East Asian Nations
Answer:(a) Association of South East Asian
Nations

47. How many members are in the ASEAN?
(a) 18
(b) 67
(c) 10
(d) 53
Answer:(c) 10

48. • When was ASEAN established?
• (a) 1963
• (b) 1967
• (c) 1985
• (d) 1996
Answer:(b) 1967

49. Answer: