19 multiple-choice (MCQ / objective) questions from this chapter, in every exam-style shape used in the paper. Every question comes with an explanation along with the answer, so you remember why the option is correct, not just which one it is.
1 Direct Questions
Direct Questions
- 1 markAccording to the chapter, what does the geological structure of a country determine, as one of the bases of international trade?
(A) The exchange rate(B) The population density(C) The literacy rate(D) The mineral resource base - 1 markAccording to the chapter, ports are generally classified according to what?
(A) Their distance from the equator(B) The types of traffic which they handle(C) The number of countries in the world(D) Their construction material
2 Assertion-Reason
Assertion-Reason
- 1 markAssertion (A): The barter system was the initial form of trade in primitive societies.
Reason (R): The barter system required a common currency to complete every exchange.
(A) Both A and R are true, and R correctly explains A(B) Both A and R are true, but R does not correctly explain A(C) A is true, but R is false(D) A is false, but R is true - 1 markAssertion (A): A country has a favourable balance of trade when the value of its imports is more than the value of its exports.
Reason (R): A negative balance of trade can ultimately lead to exhaustion of a country’s financial reserves.
(A) Both A and R are true, and R correctly explains A(B) Both A and R are true, but R does not correctly explain A(C) A is true, but R is false(D) A is false, but R is true - 1 markAssertion (A): Regional trade blocs today generate more than half of the world’s trade.
Reason (R): The chapter states that 120 regional trade blocs generate 52 per cent of the world trade.
(A) Both A and R are true, and R correctly explains A(B) Both A and R are true, but R does not correctly explain A(C) A is true, but R is false(D) A is false, but R is true
3 Match the Following
Match the Following
- 1 markMatch List I with List II and select the correct combination:
List I: 1) Industrial Ports 2) Commercial Ports 3) Oil Ports 4) Naval Ports
List II: (a) Deal in the processing and shipping of oil (b) Handle bulk cargo like grain, sugar, ore and chemicals (c) Have only strategic importance and serve warships (d) Handle general cargo, packaged products and passenger traffic
(A) 1-a, 2-c, 3-d, 4-b(B) 1-b, 2-d, 3-a, 4-c(C) 1-c, 2-a, 3-b, 4-d(D) 1-d, 2-b, 3-c, 4-a - 1 markMatch List I with List II and select the correct combination:
List I: 1) Inland Ports 2) Out Ports 3) Entrepot Ports 4) Packet Station
List II: (a) Deep water ports built away from the actual ports, serving ships too large to approach them (b) Collection centres where goods from different countries are brought together for export (c) Located away from the sea coast, linked to the sea through a river or a canal (d) Exclusively concerned with the transportation of passengers and mail across short water distances
(A) 1-a, 2-b, 3-c, 4-d(B) 1-b, 2-c, 3-d, 4-a(C) 1-d, 2-a, 3-b, 4-c(D) 1-c, 2-a, 3-b, 4-d
4 Arrange in the Correct Order
Arrange in the Correct Order
- 1 markArrange the following events in the sequence given by the chapter, from earliest to most recent:
A. Formation of GATT
B. Slave trade abolished in Great Britain
C. World Trade Organisation formed
D. Slave trade abolished in Denmark
Select the correct sequence.
(A) A, B, D, C(B) D, B, A, C(C) B, D, A, C(D) C, A, D, B - 1 markArrange these oil ports named in the chapter from west to east:
A. Tripoli (Lebanon)
B. Abadan (Gulf of Persia)
C. Maracaibo (Venezuela)
D. Esskhira (Tunisia)
Select the correct sequence.
(A) C, A, D, B(B) D, C, A, B(C) A, C, D, B(D) C, D, A, B
5 Fill in the Blanks
Fill in the Blanks
- 1 markThe word ‘salary’ comes from the Latin word __________, which means payment by salt, according to the chapter.
(A) Salarium(B) Solarium(C) Salinum(D) Salatio - 1 markAccording to the chapter, __________ is the practice of selling a commodity in two countries at a price that differs for reasons not related to costs.
(A) Bartering(B) Outsourcing(C) Dumping(D) Hedging - 1 markThe chapter names __________ as the entrepot port for Europe, while Singapore serves as the entrepot for Asia.
(A) Copenhagen(B) Rotterdam(C) Piraeus(D) Dover
6 Odd One Out
Odd One Out
- 1 markWhich one of the following, named in the chapter, is the odd one out among types of port classified by the cargo they handle?
(A) Naval Ports(B) Industrial Ports(C) Commercial Ports(D) Comprehensive Ports
7 Passage-Based Questions
Passage-Based Questions
Passage
Regional Trade Blocs have come up in order to encourage trade between countries with geographical proximity, similarity and complementarities in trading items and to curb restrictions on trade of the developing world. Today, 120 regional trade blocs generate 52 per cent of the world trade. These trading blocs developed as a response to the failure of the global organisations to speed up intra-regional trade.
- 1 markAccording to the passage, how many regional trade blocs exist today, and what share of world trade do they generate?
(A) 52 blocs generating 120 per cent(B) 100 blocs generating 50 per cent(C) 120 blocs generating 52 per cent(D) 220 blocs generating 62 per cent - 1 markAccording to the passage, why did regional trade blocs develop, as stated in the chapter?
(A) As a requirement of the General Agreement on Tariffs and Trade(B) As a response to the success of the World Trade Organisation(C) To eliminate all forms of international trade(D) As a response to the failure of the global organisations to speed up intra-regional trade
Passage
The chief gateways of the world of international trade are the harbours and ports. Cargoes and travellers pass from one part of the world to another through these ports. The ports provide facilities of docking, loading, unloading and the storage facilities for cargo. In order to provide these facilities, the port authorities make arrangements for maintaining navigable channels, arranging tugs and barges, and providing labour and managerial services. The importance of a port is judged by the size of cargo and the number of ships handled. The quantity of cargo handled by a port is an indicator of the level of development of its hinterland.
- 1 markAccording to the passage, what is used to judge the importance of a port?
(A) Its distance from the equator(B) The size of cargo and the number of ships handled(C) The number of countries it trades with(D) Its depth below sea level - 1 markAccording to the passage, what does the quantity of cargo handled by a port indicate?
(A) The level of development of its hinterland(B) The population of the port city(C) The number of naval ships it can host(D) The exchange rate of the local currency
8 True / False
True / False
- 1 markStatement I: The chapter states that GATT was formed in 1948 to liberalise the world from high customs tariffs and other restrictions.
Statement II: The chapter states that the GATT was transformed into the World Trade Organisation from 1st January 1995.
Which one of the following is correct?
(A) Both Statement I and Statement II are true(B) Statement I is true but Statement II is false(C) Statement I is false but Statement II is true(D) Both Statement I and Statement II are false - 1 markStatement I: The chapter states that bilateral trade is conducted with many trading countries at once.
Statement II: The chapter states that multi-lateral trade is done by two countries with each other.
Which one of the following is correct?
(A) Both Statement I and Statement II are true(B) Statement I is true but Statement II is false(C) Statement I is false but Statement II is true(D) Both Statement I and Statement II are false
Answer Key and Explanations
Direct Questions
- (D) The chapter states geological structure determines the mineral resource base, and topographical differences ensure diversity of crops and animals raised.
- (B) The chapter states that generally, ports are classified according to the types of traffic which they handle.
Assertion-Reason
- (C) Assertion is true, matching the chapter’s own words. Reason is false: the chapter defines the barter system as the direct exchange of goods, which by definition needed no currency at all; money was introduced only later to overcome the difficulties of barter.
- (D) Assertion is false: the chapter states a country has a positive or favourable balance of trade when the value of exports is more than the value of imports, not the other way round. Reason is true, matching the chapter’s own words on the consequence of a negative balance.
- (B) Both statements are true, but R does not explain A: R is the chapter’s figure (120 blocs generating 52 per cent of world trade) that supports A, not the cause of it. A figure that restates A as a number is evidence for A, not a reason why it is so.
Match the Following
- (B) The chapter’s own descriptions match this combination: Industrial Ports specialise in bulk cargo like grain, sugar, ore, oil and chemicals; Commercial Ports handle general cargo, packaged products and passenger traffic; Oil Ports deal in the processing and shipping of oil; and Naval Ports have only strategic importance and serve warships.
- (D) The chapter’s own descriptions match this combination: Inland Ports are located away from the sea coast, linked to the sea through a river or canal; Out Ports are deep water ports built away from the actual ports; Entrepot Ports are collection centres where goods from different countries are brought for export; and Packet Stations (ferry ports) are exclusively concerned with transporting passengers and mail across short water distances.
Arrange in the Correct Order
- (B) The chapter’s own dates place these in order: slave trade was abolished in Denmark in 1792, then Great Britain in 1807, then GATT was formed in 1948, and finally the World Trade Organisation was formed from 1st January 1995.
- (D) Maracaibo is in South America (Venezuela), Esskhira in North Africa (Tunisia), Tripoli on the eastern Mediterranean coast (Lebanon) and Abadan at the head of the Gulf of Persia, so from west to east the order is Maracaibo, Esskhira, Tripoli, Abadan.
Fill in the Blanks
- (A) The chapter states the word salary comes from the Latin word Salarium, which means payment by salt.
- (C) The chapter states the practice of selling a commodity in two countries at a price that differs for reasons not related to costs is called dumping.
- (B) The chapter states Singapore is an entrepot for Asia, Rotterdam for Europe, and Copenhagen for the Baltic region.
Odd One Out
- (A) Industrial, Commercial and Comprehensive Ports are the chapter’s own three types of port classified according to cargo handled; Naval Ports are classified separately, on the basis of specialised function, making them the odd one out.
Passage-Based Questions
- (C) The passage states today, 120 regional trade blocs generate 52 per cent of the world trade.
- (D) The passage states these trading blocs developed as a response to the failure of the global organisations to speed up intra-regional trade.
- (B) The passage states the importance of a port is judged by the size of cargo and the number of ships handled.
- (A) The passage states the quantity of cargo handled by a port is an indicator of the level of development of its hinterland.
True / False
- (A) Both statements match the chapter’s own words: GATT was formed in 1948, and it was transformed into the World Trade Organisation from 1st January 1995.
- (D) Both statements swap the chapter’s own definitions: it is multi-lateral trade that is conducted with many trading countries, and bilateral trade that is done by two countries with each other, making both statements as written false.
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