AP AP Trade, Resources & Economic Geography

Question 1

Comparative advantage in international trade means a country should:

Accepted Answer

Specialize in goods it produces at a relatively lower opportunity cost

Answer

Produce only goods it can make cheaper than any other country

Answer

Import all goods to avoid domestic production costs

Answer

Trade only with neighboring countries

Question 2

A free trade zone (FTZ) is an area where:

Accepted Answer

Goods can be imported, stored, or processed with reduced tariffs

Answer

All goods are manufactured locally without imports

Answer

Only agricultural products are traded

Answer

Foreign corporations are banned from operating

Question 3

Which sector of the economy involves extracting raw materials directly from the earth?

Accepted Answer

Primary sector

Answer

Secondary sector

Answer

Tertiary sector

Answer

Quaternary sector

Question 4

The 'resource curse' refers to the phenomenon where:

Accepted Answer

Resource-rich countries often experience slower economic growth and poor governance

Answer

Countries with many resources develop fastest

Answer

Natural resources always deplete faster than expected

Answer

Environmental protection prevents resource extraction

Question 5

Export Processing Zones (EPZs) are primarily used by developing countries to:

Accepted Answer

Attract foreign manufacturing investment by offering tax breaks and relaxed regulations

Answer

Restrict imports of manufactured goods

Answer

Protect domestic industries from foreign competition

Answer

Export agricultural surpluses to wealthy nations

Question 6

Which of the following best describes a 'commodity chain'?

Accepted Answer

The series of links connecting production, distribution, and consumption of a good

Answer

A chain of stores selling the same product globally

Answer

A cartel that controls global commodity prices

Answer

Infrastructure connecting mining regions to ports