Global and Regional Institutions Like the WTO and the EU

question 26

Multiple Choice

Global and regional institutions like the WTO and the EU help reduce transaction costs by

• A) providing a forum for exchanging goods and services.
• B) setting tariff rates on imports and exports.
• C) increasing information and transparency.
• D) forcing all states to remove barriers to trade.

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Definitions:

Excess Demand

A scenario in which the demand for a product or service surpasses the supply available at the existing price.

Surplus

An excess of production or supply over demand.

Excess Supply

A situation where the quantity of a good or service supplied exceeds the quantity demanded at the current price, leading to downward pressure on the price.

Equilibrium Quantity

The amount of products or services that are both offered and sought after at the balance price, where the supply meets the demand exactly.