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Edexcel IGCSE Economics 2.2.2 international trade

Use international-trade questions to draw tariff effects, explain protection and compare trade patterns across developed and developing countries.

Syllabus
First assessment 2019
Course
Economics 4EC1

Exam points

  • Draw tariff effects as a leftward supply shift with higher price and lower quantity.
  • Explain reasons for protection, including jobs, infant industries and dumping.
  • Compare developed and developing trade patterns using export or commodity data.

Covered syllabus points

2.2.2.a Advantages and disadvantages of free trade2.2.2.b Reasons for protection2.2.2.c Methods of protection2.2.2.d Modern trading blocs2.2.2.e Role of the World Trade Organization (WTO)2.2.2.f Trade patterns of developed and developing countries

2.2.2 International trade question 1

[Maximum number: 6]

Question (a)

(a)

Which one of the following is a role of the World Trade Organization (WTO)?

A

Writing off debts

B

Settling trade disputes

C

Increasing trade barriers

D

Paying subsidies to producers

[ 1 ]

Question (b)

(b)

Describe one advantage of free trade for consumers.

[ 2 ]

Question (c)

(c)

In May 2020, China introduced a tariff of 80\% on Australian barley.

Using the diagram below, draw the effects of the introduction of a tariff on the equilibrium price and quantity of Australian barley. Label the new curve, the new equilibrium price and new equilibrium quantity.

Figure 2

Figure 2

[ 3 ]

2.2.2 International trade question 2

[Maximum number: 1]

Which one of the following is a reason why there is protection for international trade?

A

To allow dumping

B

To promote free trade

C

To protect domestic jobs

D

To increase the current account deficit

2.2.2 International trade question 3

[Maximum number: 6]

Question (a)

(a)

Using the diagram below, draw the effects of the introduction of a quota on the equilibrium price and quantity of a good.
Label the new curve, the new equilibrium price and new equilibrium quantity.

Figure 1

Figure 1

[ 3 ]

Question (b)

(b)

In 2017 the US government wanted to introduce a 300% tariff on imported aircraft made by Canadian manufacturer Bombardier.

Explain one way the World Trade Organisation could promote free trade between countries such as Canada and the US.

[ 3 ]
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