Module 3 : Market Integration

Question 1

where 27 countries operate as a cohesive economic and political block.

Answer 1

European Union

Question 2

Of these countries , ______are using the ______ as their official currency

Answer 2

19, Euro

Question 3

was established because of the desire to form a single European political entity , to end centuries of warfare among European countries that culminated in World War II.

Answer 3

European Union

Question 4

At first it was known as _______ and _______, then it became _____________ ,then it became __________ and then under the Maastricht Treaty , it became European Union.

Answer 4

European Coal and Steel Company
European Economic Community
European Community

Question 5

It is the fusing of markets into one.

Answer 5

Market Integration

Question 6

It means that the price differences between countries are eliminated
as all markets become one.

Answer 6

Global Market Integration

Question 7

long distance trade existed for centuries

Answer 7

First Millenium BC

Question 8

Driven buy growing population and income.

Answer 8

First Millenium BC

Question 9

Created a demand for new products.

Answer 9

First Millenium BC

Question 10

Globalization took off

Answer 10

1820s

Question 11

Price differences started to close –up during 1820s because of :

Answer 11

1. Transport revolution
2. Opening of Suez Canal

Question 12

steamship, railroads, and invention of refrigeration

Answer 12

Transport revolution

Question 13

slashed the journey time between
Europe and Asia.

Answer 13

Opening of Suez Canal

Question 14

Global economy was highly
integrated

Answer 14

Eve of World War I

Question 15

Unprecedented flows of capital,
goods and labor across borders

Answer 15

Eve of World War I

Question 16

Technological change helped
integrate markets because of steam
powered transport invention.

Answer 16

19th century Onwards

Question 17

Governments imposed tariffs which
were intended to switch the demand for domestically produced goods.

Answer 17

Great Depression of the 1930s

Question 18

They imposed tariffs which
were intended to switch the demand for domestically produced goods.

Answer 18

Governments

Question 19

Enacted in the United States which
raised tariffs on imported goods.

Answer 19

Smoot-Hawley Tariff

Question 20

Tariffs reduced demand for foreign
goods.

Answer 20

Smoot-Hawley Tariff

Question 21

Foreign countries retaliated that worsened the effects of Depression of 1930s.

Answer 21

Smoot-Hawley Tariff

Question 22

It took decades to rebuild the world
economy.

Answer 22

Smoot-Hawley Tariff

Question 23

Markets are more integrated as transportation cost have continued to fall

Answer 23

End of the 20th Century

Question 24

Most tariffs have been scrapped altogether

Answer 24

End of the 20th Century

Question 25

Trend was toward a freer flow of capital across borders

Answer 25

1970s

Question 26

Liberalization of capital markets , where funds for investment can be borrowed.

Answer 26

1970s

Question 27

Problems in Global Market Integration: (DIRS)

Answer 27

- Institutional Differences between countries - Incompatibility with democracy and sovereignty . - Removal of institutional variations between countries. - It suffocates countries’ economic development

Question 28

Advantages of Global Market Integration: (HP)

Answer 28

- Harmonization of institutions across countries - Brings prosperity .

Question 29

is a group of 27 countries that operates as a cohesive economic and political block.

Answer 29

European Union (EU)

Question 30

27 member countries are

Answer 30

Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, and Sweden.

Question 31

purpose is to be more competitive in the global marketplace. At the same time, it must balance the needs of its independent fiscal and political members.

Answer 31

European Union (EU)

Question 32

It eliminates all border controls between members.

Answer 32

European Union (EU)

Question 33

is the official currency in 19 European countries, 13 of which belong to the EU

Answer 33

Euro

Question 34

It is the second most commonly held currency in the world, after the U.S. dollar. It replaced the Italian lira, the French franc, and the German Deutschmark, among others.

Answer 34

Euro

Question 35

Three bodies that run the EU:

Answer 35

The EU Council The Parliament The European Commission

Question 36

represents national governments.

Answer 36

The EU Council

Question 37

is elected by the people.

Answer 37

The Parliament

Question 38

the EU staff.

Answer 38

The European Commission

Question 39

proposes new legislation. The commissioners serve a five- year term.

Answer 39

The European Commission

Question 40

gets the first read of all laws the Commission proposes. Its members are elected every five years.

Answer 40

European Parliament

Question 41

gets the second read on all laws and can accept the Parliament’s position, thus adopting the law.

Answer 41

The European Council

Question 42

is made up of the Union’s 27 heads of state, plus a president.

Answer 42

The council

Question 43

The European Coal and Steel Community had six founding members:

Answer 43

Belgium, France, Germany, Italy, Luxembourg, and the Netherlands.

Question 44

It eliminated customs duties in 1968. It put in place standard policies, particularly in trade and agriculture.

Answer 44

Treaty of Rome

Question 45

established the European Union common market.

Answer 45

Treaty of Maastricht

Question 46

increased the powers of the European Parliament. It gave the EU the legal authority to negotiate and sign international treaties. It increased EU powers, border control, immigration, judicial cooperation in civil and criminal matters, and police cooperation.

Answer 46

Treaty of Lisbon