Question

When a country seeks to maintain a balance-of-trade surplus by reducing imports, stimulating home production, and promoting exporting exports, it is practicing 5. a. autarky b. socialism c. neomercantilism d. capitalism 6. The end of Bretton Wood system occurred in 1971 when President Richard Nixon announced the United States would a. pursue a policy of detente with the USSR b. establish diplomatic ties with China c. no longer exchange dollars for gold d. stop accepting petrodollars 7. A trade poliey of protectinism is one in which a. tariffs are established to restrict imports b. profits from one subsidiary of a MNC are used to subsidized sales by gnother subsidiary c. members of the boards of directors of MNCs may also serve on the board of d. all of the above The purpose of NAFTA is to directors of transnational banks a. maintain monetary stability among members of the United Nations b. bring Canada, Mexico, and the United States together in a free-trade zone c. coordinate interests rate within the European Union d. implement a system of voluntary export restrictions between Japan and the United States 9. The postwar Bretton Woods System rested on which of the following political bases? a. shared preference for an open international economy with limited government interventions b. the concentration of power in a small number of Western European and North c. d. American states the willingness of the United States to assume the leadership role all of the above

Answer 1

5. c) Neomercantilism

Neomercantilism is a trade policy by which a country pursues to preserve a surplus in balance-of-trade while promoting domestic production and stimulating home production, and encouraging exports. US foreign economic policy has a greater prominence of Neomercantilism in recent decades. It should be kept in mind that it is the way to promote employment by reducing imports.

6. c) no longer exchange dollors for gold

Earlier the U.S. dollar's fixed value alongside gold was seen as overvalued, under the Bretton Woods system of fixed exchange rates.