Mock Questions Module $3$

$1.$ Which entity emerged from the General Agreement on Tariffs and Trade, was formally

established in $1995$ to serve as the primary global international organization dealing

with the rules of trade between nations, ensures that trade flows smoothly, predictably

and freely, and has its headquarters in Geneva, Switzerland?

a$.$ GATT

b$.$ WTO

c$.$ WTCA

d$.$ ICC

$2.$ In which legal system does the following apply: law is based on case laws that are

determined through the judicial system; and, the method of setting law based on the

reliance of previous judicial decisions is known as the doctrine of precedent?

a$.$ Civil Law

b$.$ Common Law

c$.$ Shari'ah Law

d$.$ Token Law

$3.$ Which agreement does the following refer to: was reached in the Netherlands in $1995$

to implement export controls that control categories of goods and technologies that

may constitute some form of weapon; was established to contribute to regional and

international security and stability by promoting transparency and greater

responsibility in transfers of conventional arms and dual$-$use goods and technologies;

and, the countries involved agreed to ensure that transfers of these items do not

contribute to the development or enhancement of military capabilities that undermine

goals of international safety and security?

a$.$ Hague$/$Visby Rules

b$.$ The Wassenaar Arrangement

c$.$ The Vienna Treaty

d$.$ The Paris Convention

$4.$ Countries generally have tariffs $($taxes on imports and exports$)$; and will list the

different schedules of duty applicable on all imports into the country, as well as any

International Market Entry Strategies goods that are duty$-$free. Generally, tariffs are applied $$ad

valorem$$; what does this

mean?

a$.$ Based on the value of the goods

b$.$ By adding the tariff to the duty

c$.$ Only on value$-$added goods

d$.$ By adding value

$5.$ Which of the following is the method for customs valuation used under the WTO?

a$.$ Transaction value method

b$.$ Shipped goods method

c$.$ Tariff value method

d$.$ Value for goods method

$6.$ Which of the following categories of duty are applied to most WTO countries that have

normal trade relations with the importing country?

a$.$ Most Favoured Nation $($MFN$)$

b$.$ Generalized System of Preferences $($GSP$)$

c$.$ Normal Nation Duty $($NND$)$

d$.$ WTO Partner Duty

$7.$ Which of the following categories of duty provides duty$-$free treatment to goods

originating from many developing countries?

a$.$ Most Favoured Nation $($MFN$)$

b$.$ Generalized System of Preferences $($GSP$)$

c$.$ Developing Nation Duty $($DND$)$

d$.$ Favored Status Duty $($FSD$)$

$8.$ Which of the following terms refers to when a firm invests directly in facilities to

produce and$/$or market a product in a foreign country?

a$.$ Direct Foreign Investment $($DFI$)$

b$.$ Foreign Direct Investment $($FDI$)$

c$.$ Foreign Facility Investment $($FFI$)$

d$.$ Offshore Facility Investment $($OFI$)$

$9.$ Many countries maintain quotas and other regulations that discriminate against foreign

products to protect their domestic manufacturers. What are these restrictions called?

a$.$ Anti$-$competitive regulations

b$.$ Restrictive foreign rules

c$.$ Non$-$tariff barriers

d$.$ Protective domestic actions

$10.$ In international trade, dumping occurs when foreign competitors $$dump$$ their products

into a market below normal value or cost to gain market share and local competitors

in that market suffer material injury with substantial losses as a result. If it is

determined that dumping has occurred, WTO countries will generally initiate which of

the following anti$-$dumping measures?

a$.$ Anti$-$dumping VAT

b$.$ Countervailing Duties

c$.$ Retaliatory Excise Tax

d$.$ Normative tariffs

$11.$ Farantz Lighting LLC is an active exporter to Libya, but recently the company$$s

marketing director read in the news that an embargo was being put in place against

Libya. What does this mean for Farantz?

a$.$ This may not impact the company since an embargo is usually a narrowly

defined set of prohibitions put in place by multilateral organizations like the UN

and the EU $($i$.$e$.$ it generally only affects a narrow range of shipments$)$

b$.$ This will most likely impact the company because an embargo is

traditionally a complete $($government$-$imposed$)$ ban on commercial

activity between nations

c$.$ This will definitely not impact the company because embargoes only apply to

government$-$to$-$government business and transactions

d$.$ This will definitely not impact the company because embargoes only ever apply

to strategic resources like oil, gas, certain minerals, etc.

$12.$ The Red Bird Bus Company is a manufacturer of school buses and emergency

vehicles located in Miami, Florida, U$.$S$.$ The company recently received a significant

purchase order for $10$ vehicles to be delivered to Syria, with very favorable cash in

advance payment terms. Which of the following lists should the company check before

taking any actions?

a$.$ The International Chamber of Commerce reference database

b$.$ The U$.$S$.$ Departmen