MEC 007 INTERNATIONAL TRADE AND FINANCE December 2019 Question Paper

 

MEC 007 INTERNATIONAL TRADE AND FINANCE

December 2019 Question Paper

Time : 3 Hours] [Maximum Marks : 100

Note : Attempt questions from each section as per instructions given.

Section - A

Answer any two questions from this section.

1. What do you mean by the term 'effective rate of protection'? What are the implications when the effective rate of protection is

i) equal to the nominal rate of protection

ii) greater than the nominal rate of protection and iii) negative

2. a) What justification is often used by economists to give preference to tariffs over quotas?

b) Mention at least two criticisms of the terms of trade argument for protectionism. Explain the market failure argument for justifying trade protection. What is the relation between the infant industry and the market failure arguments for protection?

 3. a) What do you mean by Gold standard? Why is Gold standard considered to be a fixed exchange rate regime? Why was Gold standard abandoned?

b) Describe the salient features of the Bretton Woods system. Explain the reasons behind the demise of the Bretton Woods system.

4. a) Provide a critical evaluation of the monetary approach to the balance of payments.

b) What are SDRs? Discuss their important features.

Section - B

Answer any five questions from this section.

5. Explain the causes, as explained by Ricardo, that result in the differences in opportunity cost and comparative advantage.

6. Examine the Leontief paradox as an empirical critique of Heckscher-Ohlin theorem.

7. Critically examine whether exports lead to growth. Is it applicable to INDIA currently.

8. What were the reasons behind the growing importance of services in trade? How many modes of providing services are discussed under WTO's CATS?

9. Explain the role of Regional Trade Agreements (RTAs) in Global Trade. Briefly discuss the welfare effects of RTA's both in case of

i) Trade diversion; and

ii) Trade creation

10. "ASEAN is a successful trading bloc". Discuss

11. Elaborate important export promotion measures including major innovative schemes launched in recent years.

12. What does capital account convertibility imply? Why India has been slow in bringing about capital account convertibility?

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