TOPIC 1: PRODUCTION ACROSS COUNTRIES
Q1.
A Japanese automobile company sets up a production plant in India because labour and other production costs are relatively lower. It also sells some of the cars produced in India in other countries. Which feature of global production is best illustrated?
A. Foreign trade is being completely replaced by domestic production
B. Production is increasingly organised across different countries
C. Consumers are producing goods for multinational companies
D. Governments have stopped regulating international trade
Q2.
An MNC wants to expand production in another country. Instead of constructing a completely new factory, it purchases an already-established local company. Why might this strategy be useful?
A. It eliminates the need to sell products in foreign markets
B. It removes all competition from the international market
C. It gives the MNC immediate access to existing production facilities and markets
D. It prevents the local company from producing any other goods
Q3.
Company X designs sports shoes in one country, gets major components manufactured in another country, assembles them in a third country and sells them globally. What does this arrangement most clearly demonstrate?
A. Interlinking of production across countries
B. Dependence only on domestic producers
C. Replacement of production by foreign trade
D. Complete economic isolation
Q4.
An MNC places orders with several small producers in a developing country rather than building its own factory there. Which consequence is most directly possible?
A. Foreign investment automatically disappears
B. International production becomes impossible
C. Small producers become completely independent of global markets
D. Small producers become linked to international production networks
Q5.
An Indian company supplies components to a multinational automobile manufacturer. The MNC provides technical specifications and quality requirements, while the Indian company undertakes production. Which relationship is being illustrated?
A. Elimination of international trade
B. MNC–local producer integration
C. Government ownership of production
D. Complete withdrawal of the MNC from production
Q6.
Suppose an MNC chooses a country because it has skilled workers, suitable infrastructure and access to a large market. Which inference is most appropriate?
A. Foreign investment is unrelated to production conditions
B. MNCs invest only where governments prohibit foreign trade
C. MNC investment decisions depend only on the size of the country’s population
D. MNCs consider several economic factors while organising production
Q7.
A product sold in India carries a brand owned by an American company, uses components manufactured in different countries and is assembled in India. Which conclusion is most appropriate?
A. Foreign trade has no connection with production
B. MNCs can operate only in their country of origin
C. Production may involve different countries even when the final product is sold domestically
D. The product is entirely a domestic product
Q8.
Two countries specialise in different stages of producing the same product. Country A produces electronic components while Country B assembles the final product. Why might an MNC prefer such an arrangement?
A. To organise different stages where production conditions are suitable
B. To avoid using specialised resources
C. To reduce the role of technology in production
D. To ensure that all production takes place in one country
TOPIC 2: INTERLINKING PRODUCTION ACROSS COUNTRIES
Q9.
An MNC obtains raw materials from one country, components from another and assembles the final product elsewhere. If production in one country stops, production in other countries is affected. What does this situation demonstrate?
A. Elimination of international markets
B. Decline of multinational production
C. Complete independence of national economies
D. Interdependence created by global production networks
Q10.
A local manufacturer receives a large order from an MNC. The order requires the manufacturer to improve technology and product quality. Which outcome is most logically possible?
A. Foreign investment necessarily falls
B. Participation in global production may encourage technological and quality improvements
C. International production becomes less specialised
D. The local producer becomes disconnected from global production
Q11.
An MNC chooses to work with local companies rather than produce every component itself. Which advantage can the MNC obtain?
A. Access to existing local production capabilities
B. Automatic control over every local business
C. Elimination of the need for consumers
D. Complete removal of all production costs
Q12.
A local firm becomes dependent on orders from an MNC. If the MNC shifts its orders to another country, the local firm’s production falls sharply. What does this situation reveal?
A. MNCs always protect local producers from market risks
B. Global production eliminates competition
C. Globalisation can create opportunities as well as new forms of dependence
D. Foreign investment guarantees permanent demand
Q13.
Suppose an MNC divides production into several stages and locates each stage in the country where it can be performed efficiently. Which economic reasoning supports this decision?
A. Countries should avoid specialisation
B. International trade becomes unnecessary
C. Every stage must have identical production costs
D. Production becomes efficient when suitable resources and skills are used at different locations
Q14.
An Indian company receives a contract from an MNC but must meet strict international quality standards. Which longer-term effect could arise?
A. The company may improve its production standards to remain part of the supply chain
B. The company becomes completely isolated from foreign markets
C. The company must stop using technology
D. The MNC loses all influence over production
Q15.
An MNC coordinates production among several countries using digital communication and rapid transport. Why are these technologies important to global production?
A. They eliminate the need for producers
B. They allow firms to coordinate geographically separated production activities
C. They prevent international coordination
D. They make foreign trade impossible
Q16.
A multinational firm can shift an order from one supplier to another country when production costs change. What does this indicate about global production networks?
A. They prevent firms from responding to market conditions
B. They eliminate all competition among suppliers
C. They can give firms flexibility in organising production
D. They make production completely local
TOPIC 3: FOREIGN TRADE AND INTEGRATION OF MARKETS
Q17.
Before increased foreign trade, consumers in a town could buy only locally produced shoes. After trade expands, shoes from several countries become available. Which change is most directly associated with foreign trade?
A. Greater choice for consumers
B. Reduction in the number of products available
C. Complete removal of competition
D. Elimination of all domestic production
Q18.
An Indian producer of toys faces competition from imported toys after import restrictions are reduced. Which effect of foreign trade is illustrated?
A. Imports cannot affect domestic producers
B. Foreign trade can increase competition in domestic markets
C. Foreign trade always protects domestic producers
D. Foreign trade eliminates consumer choice
Q19.
Suppose the price of a product falls after cheaper imported products enter the domestic market. Which explanation best connects this change with foreign trade?
A. Foreign trade always raises prices
B. Imports reduce consumer choice
C. Domestic producers become free from market competition
D. Imports may increase competition and put pressure on domestic producers to remain competitive
Q20.
A shirt available earlier only from a domestic producer is now available from companies based in several countries. What does this suggest about market integration?
A. Foreign trade has stopped influencing domestic markets
B. Markets are becoming more isolated
C. Consumers and producers in different countries are becoming connected through trade
D. Producers are becoming less connected
Q21.
A domestic company improves the quality of its product after foreign competitors enter the market. What does this example show?
A. Imports prevent innovation
B. Competition from foreign producers can encourage domestic producers to improve
C. Foreign trade always destroys domestic firms
D. Domestic producers cannot respond to competition
Q22.
Country A exports cotton to Country B, where it is converted into garments that are later sold in Country A. Which conclusion is most appropriate?
A. Foreign trade can connect production and markets across countries
B. Exports and imports cannot occur within the same production chain
C. Foreign trade affects only consumers and not producers
D. International markets are completely separate
Q23.
A consumer can now choose between a locally manufactured television and several imported brands. Which combination best explains the change?
A. Complete closure of domestic markets
B. Decline in competition and reduction in trade
C. Removal of all domestic producers
D. Expansion of foreign trade and increased market integration
Q24.
A local producer loses some customers after imported products become available but responds by improving quality and reducing costs. What does this situation best demonstrate?
A. Foreign trade guarantees profits for every domestic producer
B. Imports always eliminate domestic production
C. Foreign trade can simultaneously create competitive pressure and encourage producers to respond
D. Competition becomes irrelevant after trade expands
TOPIC 4: WHAT IS GLOBALISATION?
Q25.
A mobile phone sold in India is designed in one country, assembled in another and contains components from several countries. Which concept best explains this situation?
A. Complete localisation of production
B. Decline of international trade
C. Globalisation through interconnection of production
D. Economic isolation
Q26.
A consumer in India purchases products made by companies from many countries, while Indian producers sell goods abroad. Which broad economic process is reflected?
A. Nationalisation
B. Economic autarky
C. De-globalisation
D. Globalisation
Q27.
Which situation would provide the strongest evidence that an economy is becoming increasingly integrated with the world economy?
A. Production, investment and trade increasingly connect domestic firms with international markets
B. Government completely bans foreign investment
C. Domestic firms stop exporting and importing
D. Consumers purchase only locally produced goods
Q28.
An MNC establishes production in India, sources inputs from Indian firms and exports part of its output. Which combination of processes is involved?
A. Only foreign trade
B. Production, investment and trade becoming internationally connected
C. Only government-controlled production
D. Only domestic production
Q29.
A student says, “Globalisation simply means that people can buy imported goods.” Which response is most accurate?
A. Globalisation refers only to tourism
B. The statement completely defines globalisation
C. The statement captures only one part of globalisation
D. Globalisation has nothing to do with production
Q30.
Two economies become connected because firms invest across borders, production is spread across countries and goods are traded internationally. Which conclusion follows?
A. Globalisation refers only to foreign tourism
B. Globalisation reduces international connections
C. Globalisation prevents firms from operating internationally
D. Globalisation involves multiple forms of economic integration
Q31.
If foreign trade increases but production and investment remain completely domestic, which aspect of globalisation would be relatively limited?
A. Cross-border integration of production and investment
B. Local production
C. Market exchange
D. Domestic consumption
Q32.
A country becomes connected to global markets through MNC investment, foreign trade and internationally organised production. Which statement best captures the underlying idea?
A. Globalisation means complete dependence on imports
B. Globalisation is a process of increasing integration between countries
C. Globalisation means eliminating government policy
D. Globalisation means ending domestic production
TOPIC 5: FACTORS THAT HAVE ENABLED GLOBALISATION
Q33.
An Indian manufacturer communicates instantly with a buyer in Europe through digital technology and receives production instructions within seconds. Which factor has most directly enabled this?
A. Improvement in information and communication technology
B. Decline in international trade
C. Reduction in domestic demand
D. Elimination of transportation
Q34.
A company can transport goods between distant countries much faster than in the past. As a result, it becomes easier to organise production across countries. Which factor is most relevant?
A. Reduction in consumer choice
B. Increased trade barriers
C. Decline in communication technology
D. Improvements in transportation technology
Q35.
An MNC monitors suppliers in several countries through internet-based communication systems. Why is this important for globalisation?
A. It stops foreign investment
B. It removes the need for markets
C. It allows firms to coordinate activities across geographical boundaries
D. It prevents international production
Q36.
Suppose transportation becomes extremely slow and expensive while communication remains fast. Which part of global production would still face a major difficulty?
A. Communication between firms
B. Movement of physical goods between countries
C. Electronic communication
D. Exchange of information
Q37.
A government reduces restrictions on imports and allows greater foreign investment. At the same time, communication and transport improve. What is the most likely broad effect?
A. Conditions become more favourable for greater global economic integration
B. International production becomes impossible
C. Foreign trade automatically disappears
D. Domestic markets become completely isolated
Q38.
A company can receive design instructions electronically, produce components in different countries and transport them rapidly for assembly. Which combination best explains this possibility?
A. Complete prohibition of foreign investment
B. Trade barriers and isolation
C. Reduced communication and slower transport
D. Technology and transport improvements
Q39.
Why can improved communication technology make globalisation easier even when the physical movement of goods remains necessary?
A. It prevents firms from communicating internationally
B. It helps firms coordinate production, orders and information across countries
C. It removes the need for transportation
D. It eliminates all physical production
Q40.
A country improves its transport infrastructure but maintains very high barriers on imports and foreign investment. What does this suggest?
A. Trade barriers always increase globalisation
B. Foreign investment becomes automatic
C. Technology alone may not be sufficient for full economic integration
D. Globalisation depends only on transport
TOPIC 6: LIBERALISATION OF FOREIGN TRADE AND INVESTMENT POLICY
Q41.
A government imposes a high tax on imported electronic goods to make imported products more expensive compared with domestic products. What is this an example of?
A. Market integration
B. Liberalisation
C. Foreign investment
D. Trade barrier
Q42.
Suppose a government removes many restrictions on imports and allows foreign companies greater freedom to invest. Which policy direction is being followed?
A. Liberalisation
B. Nationalisation
C. Protectionism
D. Economic isolation
Q43.
Before liberalisation, an imported product faced strict restrictions. After liberalisation, imports become easier. Which immediate market effect is most likely?
A. International trade stops
B. Domestic producers face greater competition
C. Consumer choice necessarily becomes smaller
D. Foreign products completely disappear
Q44.
Why might a government earlier impose restrictions on imports?
A. To eliminate domestic production
B. To increase dependence on imports
C. To protect domestic producers from foreign competition
D. To prevent all economic activity
Q45.
After trade barriers are reduced, an Indian producer finds that foreign products are competing for the same customers. Which response would be economically rational?
A. Improve quality, reduce costs or otherwise become more competitive
B. Avoid all technological improvement
C. Stop producing immediately in every case
D. Demand complete elimination of consumer choice
Q46.
India’s trade policy changed significantly after 1991, with greater emphasis on liberalisation. Which statement best describes the significance of this change?
A. India completely stopped participating in international trade
B. India banned foreign investment
C. India moved towards greater integration with the world economy
D. India eliminated all domestic firms
Q47.
A country keeps strict import restrictions but allows foreign companies to invest freely in domestic production. Which inference is most appropriate?
A. Different aspects of economic liberalisation can be changed separately
B. Trade liberalisation and investment liberalisation are identical
C. Foreign investment becomes impossible
D. Imports must automatically increase without limit
Q48.
A domestic firm argues that removing import restrictions exposes it to international competition, while consumers gain access to more products. What does this situation demonstrate?
A. Liberalisation guarantees equal outcomes for all producers
B. Liberalisation can create both competitive pressures for producers and greater choice for consumers
C. Liberalisation affects only government revenue
D. Liberalisation removes all competition
TOPIC 7: WORLD TRADE ORGANISATION (WTO)
Q49.
Several countries agree to follow common rules governing international trade. Which institution is most closely associated with this process?
A. NITI Aayog
B. Election Commission of India
C. Reserve Bank of India
D. World Trade Organisation
Q50.
A developing country argues that trade rules should provide developing countries fair opportunities in international markets. Which broader issue is being raised?
A. Fairness in the functioning of international trade rules
B. Elimination of all foreign trade
C. Removal of all international institutions
D. Complete closure of domestic markets
Q51.
A country joins an international organisation that establishes rules relating to trade among countries. What is the primary area of its participation?
A. Population census
B. Domestic taxation alone
C. International trade
D. Local government administration
Q52.
A student says, “The WTO exists mainly to stop countries from trading with each other.” Which reasoning correctly challenges this statement?
A. The WTO prevents all imports
B. The WTO exists only to control domestic prices
C. The WTO operates only within one country
D. The WTO is associated with establishing and administering rules for international trade, not stopping international trade
Q53.
If WTO rules encourage countries to reduce trade restrictions, which potential consequence can follow?
A. Greater opportunities for international trade
B. End of international production
C. Complete disappearance of domestic markets
D. Elimination of all competition
Q54.
A developing country claims that international trade rules should take into account the interests of developing economies. Why is this concern economically relevant?
A. Trade affects every country in exactly the same way
B. Countries have different levels of development and may experience international trade differently
C. Developing countries do not participate in international trade
D. All countries have identical production capacities
Q55.
Suppose countries follow common trade rules but still compete with one another in international markets. What does this indicate?
A. Trade rules eliminate competition
B. Countries stop producing goods after joining the WTO
C. Common rules and international competition can coexist
D. WTO membership eliminates foreign trade
Q56.
An international institution promotes a framework for international trade, while individual governments continue to formulate domestic economic policies. Which conclusion is most appropriate?
A. WTO membership ends national governments’ economic roles
B. Domestic governments become unnecessary
C. International institutions automatically control every domestic policy
D. International trade rules and domestic economic policies can operate simultaneously
TOPIC 8: IMPACT OF GLOBALISATION IN INDIA
Q57.
A consumer who previously had access to only a few brands can now choose among many Indian and foreign brands. Which impact of globalisation is most directly visible?
A. Elimination of product variety
B. Reduction in competition
C. Greater consumer choice
D. Complete disappearance of domestic firms
Q58.
An Indian automobile company faces competition from international companies and responds by improving technology and product quality. Which possible effect of globalisation does this illustrate?
A. Increased competitive pressure can encourage domestic firms to improve
B. Competition becomes irrelevant
C. Globalisation always reduces productivity
D. Foreign competition automatically closes all Indian companies
Q59.
A small Indian producer loses market share after cheaper imported goods enter the market. What does this example demonstrate?
A. Globalisation always protects small firms
B. The gains from globalisation may not be equally distributed among all producers
C. Foreign trade has no effect on small producers
D. Every domestic producer benefits equally
Q60.
An Indian company becomes successful internationally and expands its production after entering global markets. Which conclusion is most appropriate?
A. International markets prevent expansion of Indian companies
B. Globalisation benefits only foreign companies
C. Some Indian companies can benefit from opportunities created by globalisation
D. Indian firms cannot compete internationally
Q61.
A large Indian producer adopts international production standards after becoming part of a global supply chain. Which possible effect is being demonstrated?
A. Global supply chains eliminate competition
B. Participation in global markets can encourage improvements in production standards
C. Globalisation prevents technological improvement
D. International production reduces all quality requirements
Q62.
Two Indian producers experience different outcomes after liberalisation: one expands rapidly, while another struggles against imports. What does this comparison suggest?
A. Globalisation always produces identical outcomes
B. Foreign competition affects every producer in exactly the same way
C. All domestic firms necessarily gain equally
D. The impact of globalisation can differ across firms and sectors
Q63.
Consumers benefit from a wider range of products, while some small producers face stronger competition. Which interpretation is most balanced?
A. Globalisation can create opportunities and competitive pressures at the same time
B. Globalisation has only negative effects
C. Globalisation has no effect on markets
D. Globalisation has only positive effects
Q64.
An Indian company gains access to foreign markets and increases production, but a small local producer cannot compete with larger international firms. What does this case highlight?
A. Small producers always outperform MNCs
B. Globalisation guarantees equal benefits
C. Different producers may experience globalisation differently depending on their capacity and market position
D. Foreign trade has no effect on production decisions
TOPIC 9: CHALLENGES AND UNEQUAL EFFECTS OF GLOBALISATION
Q65.
A small producer has limited access to advanced technology and finance, while a large MNC has both. After liberalisation, both compete in the same market. Why may the small producer face greater difficulty?
A. Small producers always have higher costs because they are domestic
B. MNCs cannot use technology
C. Liberalisation automatically gives small firms more resources
D. Their productive capacities and access to resources may differ substantially
Q66.
A global company shifts its orders from one supplier to another country where production costs are lower. The first supplier loses business. What does this demonstrate?
A. Global production can create opportunities but also expose producers to international competition and changing orders
B. MNCs cannot change suppliers
C. Globalisation guarantees permanent contracts
D. International production eliminates market risk
Q67.
A government observes that some industries gain from globalisation while some small producers face difficulties. Which policy response is most consistent with the idea of managing unequal effects?
A. Eliminate consumer choice
B. Provide appropriate support and improve the ability of weaker producers to compete
C. Ban all foreign trade immediately
D. Prevent all domestic firms from exporting
Q68.
Why might the benefits of globalisation not be equally distributed among workers and producers?
A. International markets guarantee equal income
B. Globalisation affects only consumers
C. People and firms differ in skills, technology, resources and ability to compete
D. Every worker and producer has identical economic opportunities
Q69.
A small garment producer loses orders because an MNC shifts production to another country. Which conclusion should NOT automatically be drawn?
A. Globalisation can create competitive pressure
B. International production decisions can affect local producers
C. Every small producer must necessarily disappear because of globalisation
D. Producers may need to improve competitiveness
Q70.
An industry receives foreign investment and modern technology but also faces stronger international competition. Which conclusion best reflects the situation?
A. Globalisation can bring both new opportunities and new competitive pressures
B. Technology and competition cannot occur together
C. Foreign investment always eliminates competition
D. Foreign investment always creates losses
Q71.
Two sectors respond differently to globalisation: one expands because it can compete internationally, while another contracts because it faces cheaper imports. What does this reveal?
A. Imports never affect domestic production
B. Globalisation has exactly the same effect everywhere
C. The effects of globalisation depend partly on the characteristics and competitiveness of individual sectors
D. Export-oriented sectors cannot benefit from globalisation
Q72.
A policymaker wants to increase the benefits of globalisation while reducing difficulties faced by vulnerable producers. Which approach is most logically consistent?
A. Close the economy completely
B. Combine openness to opportunities with measures that improve competitiveness and provide appropriate support
C. Remove every form of domestic production
D. Prevent consumers from buying imported goods
TOPIC 10: STRUGGLE FOR A FAIR GLOBALISATION
Q73.
A workers’ organisation demands better working conditions from a company participating in global production. Which broader issue does this demand relate to?
A. Protecting workers’ interests while participating in globalisation
B. Eliminating domestic production
C. Ending all international trade
D. Preventing technological development
Q74.
A government supports small producers with training and improved access to technology so that they can compete in a more open market. What objective does this policy support?
A. Reducing consumer choice
B. Helping weaker producers participate more effectively in globalisation
C. Eliminating all competition
D. Preventing all foreign investment
Q75.
A developing country argues that international trade rules should give developing countries adequate opportunities to benefit from global trade. Which idea is most closely reflected?
A. Permanent protection from all competition
B. Elimination of foreign markets
C. The demand for fairer rules in globalisation
D. Complete withdrawal from world trade
Q76.
If the government completely withdraws from regulating the effects of globalisation, which group may require particular attention according to the idea of fair globalisation?
A. Only large MNCs
B. Only exporters that are already highly competitive
C. Only foreign consumers
D. Vulnerable workers and small producers
Q77.
A country wants to participate in global trade but also wants domestic policies that protect workers and support producers facing adjustment difficulties. Which principle does this approach reflect?
A. International trade should be banned
B. Globalisation should be completely rejected
C. Global integration should be accompanied by policies aimed at sharing its benefits more fairly
D. Domestic producers should never face competition
Q78.
An international trade agreement benefits large exporters but creates adjustment difficulties for some small producers. What would a fair-globalisation approach focus on?
A. Preventing consumers from accessing foreign products
B. Ensuring that the gains from globalisation are more broadly shared
C. Giving all benefits only to large exporters
D. Eliminating all international trade
Q79.
A government wants its economy to remain internationally connected while reducing the disadvantages faced by weaker sections. Which policy direction is most consistent with fair globalisation?
A. Combine participation in global markets with appropriate social and economic support
B. Stop Indian firms from exporting
C. Close all domestic markets permanently
D. Ban all MNCs
Q80.
Consider the following situation: Globalisation creates new opportunities for consumers and competitive firms, but some workers and small producers face difficulties adjusting to increased competition. Which conclusion best captures the central issue of the chapter?
A. Globalisation automatically guarantees equal benefits to everyone
B. Globalisation should be understood only as an increase in imports
C. Globalisation has no effect on domestic producers
D. Globalisation affects different groups differently, making the distribution of its benefits an important issue
DETAILED ANSWER KEY
Topic 1
| Q | Answer | Explanation |
| 1 | B | The company is organising production in India while selling internationally. This illustrates how production can be spread across different countries. |
| 2 | C | Buying an existing local company can provide immediate access to established facilities, workers, suppliers and markets. |
| 3 | A | Different stages of one product are being carried out in different countries, showing interlinking of production. |
| 4 | D | When MNCs place orders with small producers, these producers become connected with international production networks. |
| 5 | B | The local company is supplying components to an MNC according to its requirements, showing integration between an MNC and a local producer. |
| 6 | D | MNCs consider several factors, including skilled labour, infrastructure, market size and production conditions. |
| 7 | C | The example demonstrates that production may involve several countries even though the finished product is sold in India. |
| 8 | A | MNCs can divide production among locations where particular resources, skills and production conditions are suitable. |
Topic 2
| Q | Answer | Explanation |
| 9 | D | When a disruption in one country affects production elsewhere, it shows interdependence within a global production network. |
| 10 | B | International orders may encourage local firms to improve their technology and quality so that they can meet MNC requirements. |
| 11 | A | Working with local companies gives MNCs access to existing local production capabilities and knowledge. |
| 12 | C | Global production can provide orders and opportunities but can also make local firms dependent on decisions made by MNCs. |
| 13 | D | Locating different production stages where suitable resources and skills exist can improve efficiency. |
| 14 | A | Meeting international quality standards may require the Indian company to improve its production methods and standards. |
| 15 | B | Communication and transport allow firms to coordinate activities that are physically located in different countries. |
| 16 | C | Global production networks can allow firms to change suppliers or locations when production conditions change. |
Topic 3
| Q | Answer | Explanation |
| 17 | A | Foreign trade makes goods from different countries available in domestic markets, increasing consumer choice. |
| 18 | B | Imported toys compete with domestic toys, increasing competitive pressure in the domestic market. |
| 19 | D | Cheaper imports can increase competition and put pressure on domestic producers to reduce costs or improve competitiveness. |
| 20 | C | When products from several countries become available in the same market, markets become increasingly interconnected. |
| 21 | B | Foreign competition can encourage domestic firms to improve quality and other aspects of competitiveness. |
| 22 | A | Cotton moves from one country to another for processing and the finished product returns to the first market, showing connected markets and production. |
| 23 | D | Expansion of foreign trade can increase product variety and integrate domestic markets with international markets. |
| 24 | C | Foreign trade can create pressure through competition while also motivating domestic producers to improve their performance. |
Topic 4
| Q | Answer | Explanation |
| 25 | C | Production is spread across several countries, illustrating globalisation through increasing interconnection of production. |
| 26 | D | The example shows goods, producers and markets in different countries becoming interconnected, which is globalisation. |
| 27 | A | Increasing connections in production, investment and trade provide strong evidence of integration with the world economy. |
| 28 | B | The example includes foreign investment, production linkages and exports, combining several aspects of globalisation. |
| 29 | C | Imported goods represent only one part of globalisation; globalisation also involves investment, production and market integration. |
| 30 | D | Globalisation involves several forms of economic integration, including trade, investment and internationally organised production. |
| 31 | A | If production and investment remain entirely domestic, cross-border integration in these areas remains limited. |
| 32 | B | At its broadest level, globalisation refers to increasing integration between countries. |
Topic 5
| Q | Answer | Explanation |
| 33 | A | Information and communication technology allows firms in different countries to exchange information almost instantly. |
| 34 | D | Faster and more efficient transportation makes it easier to move goods between distant countries. |
| 35 | C | Internet-based communication helps firms coordinate production and suppliers located in different countries. |
| 36 | B | Even with fast communication, physical goods must still move between countries, so slow and expensive transport remains a major obstacle. |
| 37 | A | Liberalisation combined with improvements in communication and transport creates conditions favourable to greater global integration. |
| 38 | D | Electronic communication supports coordination while improved transport enables physical components to move efficiently. |
| 39 | B | Communication technology helps firms coordinate orders, designs, schedules and other production information across countries. |
| 40 | C | Better technology alone cannot guarantee complete integration if significant restrictions on trade and investment remain. |
Topic 6
| Q | Answer | Explanation |
| 41 | D | A tax imposed on imports is a trade barrier because it makes imported goods more expensive and can restrict their entry. |
| 42 | A | Reducing restrictions on imports and foreign investment is part of liberalisation. |
| 43 | B | Easier imports expose domestic producers to greater competition from foreign producers. |
| 44 | C | Import restrictions may be used to protect domestic producers from competition from foreign goods. |
| 45 | A | A domestic producer can respond to competition by improving quality, reducing costs and becoming more competitive. |
| 46 | C | After 1991, India reduced several trade and investment restrictions, increasing its integration with the world economy. |
| 47 | A | Trade liberalisation and investment liberalisation are related but distinct; a government can change restrictions in one area without making identical changes in the other. |
| 48 | B | Liberalisation can increase competition for domestic producers while simultaneously expanding choices for consumers. |
Topic 7
| Q | Answer | Explanation |
| 49 | D | The WTO is the international organisation associated with rules governing trade between countries. |
| 50 | A | The concern relates to whether international trade rules provide fair opportunities for countries at different levels of development. |
| 51 | C | WTO participation is primarily related to international trade and the rules governing trade among countries. |
| 52 | D | The WTO provides a framework of rules for international trade; its role is not to stop countries from trading. |
| 53 | A | Lower trade restrictions can create greater opportunities for countries and firms to participate in international trade. |
| 54 | B | Countries differ in their levels of development and productive capacities, so they may experience international trade differently. |
| 55 | C | Common international rules do not eliminate competition; countries and firms can still compete within those rules. |
| 56 | D | International trade rules operate alongside domestic government policies. WTO membership does not remove the role of national governments. |
Topic 8
| Q | Answer | Explanation |
| 57 | C | Increased availability of domestic and foreign brands expands the choices available to consumers. |
| 58 | A | International competition can encourage Indian firms to improve technology, quality and efficiency. |
| 59 | B | Globalisation does not benefit all producers equally; some small producers may face greater competitive pressure. |
| 60 | C | Some Indian companies have used access to international markets to expand production and business opportunities. |
| 61 | B | Participation in global supply chains can require firms to meet international standards and therefore encourage improvements. |
| 62 | D | Different firms have different resources, technologies, productivity and competitive strengths, so their experiences can vary. |
| 63 | A | Globalisation can simultaneously expand opportunities and increase competitive pressure on different groups. |
| 64 | C | The effects of globalisation can differ according to the size, resources, technology and competitive capacity of producers. |
Topic 9
| Q | Answer | Explanation |
| 65 | D | A small producer with limited finance and technology may find it harder to compete with a large MNC possessing greater resources. |
| 66 | A | International production can provide business opportunities but also expose suppliers to changing costs and sourcing decisions. |
| 67 | B | Support such as training, technology and improved competitiveness can help weaker producers adjust to greater competition. |
| 68 | C | Workers and firms differ in skills, technology, resources and productivity, so the benefits and costs of globalisation can differ. |
| 69 | C | Although some small producers may face difficulties, it is not correct to conclude that every small producer must disappear. |
| 70 | A | Foreign investment may bring capital and technology while global integration simultaneously increases competitive pressure. |
| 71 | C | Different sectors have different levels of competitiveness and face different market conditions, so globalisation can affect them differently. |
| 72 | B | Combining global opportunities with measures that improve competitiveness and support vulnerable groups can address unequal effects. |
Topic 10
| Q | Answer | Explanation |
| 73 | A | Better working conditions relate to protecting workers’ interests as production becomes increasingly connected internationally. |
| 74 | B | Training and technology can improve the capacity of small producers to compete and participate in global markets. |
| 75 | C | The demand concerns making international trade rules fairer and ensuring developing countries have meaningful opportunities to benefit. |
| 76 | D | Vulnerable workers and small producers may have fewer resources to adjust to increased international competition. |
| 77 | C | Fair globalisation seeks to combine participation in global markets with policies that make the benefits more broadly shared. |
| 78 | B | A fair-globalisation approach focuses on making the gains from globalisation more broadly distributed. |
| 79 | A | A country can remain internationally connected while using appropriate economic and social policies to address disadvantages faced by weaker groups. |
| 80 | D | The chapter highlights that globalisation creates opportunities but does not affect all groups equally, making distribution of benefits an important issue. |
FINAL ANSWER-POSITION TABLE
| Q | Ans | Q | Ans | Q | Ans | Q | Ans |
| 1 | B | 21 | B | 41 | D | 61 | B |
| 2 | C | 22 | A | 42 | A | 62 | D |
| 3 | A | 23 | D | 43 | B | 63 | A |
| 4 | D | 24 | C | 44 | C | 64 | C |
| 5 | B | 25 | C | 45 | A | 65 | D |
| 6 | D | 26 | D | 46 | C | 66 | A |
| 7 | C | 27 | A | 47 | A | 67 | B |
| 8 | A | 28 | B | 48 | B | 68 | C |
| 9 | D | 29 | C | 49 | D | 69 | C |
| 10 | B | 30 | D | 50 | A | 70 | A |
| 11 | A | 31 | A | 51 | C | 71 | C |
| 12 | C | 32 | B | 52 | D | 72 | B |
| 13 | D | 33 | A | 53 | A | 73 | A |
| 14 | A | 34 | D | 54 | B | 74 | B |
| 15 | B | 35 | C | 55 | C | 75 | C |
| 16 | C | 36 | B | 56 | D | 76 | D |
| 17 | A | 37 | A | 57 | C | 77 | C |
| 18 | B | 38 | D | 58 | A | 78 | B |
| 19 | D | 39 | B | 59 | B | 79 | A |
| 20 | C | 40 | C | 60 | C | 80 | D |