1. What is a trade barrier?

Name: __________________________________________ Date: __________________________
Study Guide for Test on Europe’s Economics
GPS: SS6E5 The student will analyze different economic systems. SS6E6 The student will analyze the
benefits of and barriers to voluntary trade in Europe. SS6E7 The student will describe factors that
influence economic growth and examine their presence or absence in Europe.
1. What is a trade barrier? a way to limit trade with other countries
2. What is a tariff? A tax on imported goods
3. What is a quota? a limit on the number of goods that may enter a country
4. What is an embargo? a government order stopping trade with another country
5. What is a free-trade zone? An area where there are no tariffs on imported
6. Which type of trade barrier involves a limit on goods brought into the
country? quota
7. In order to help Russian farmers sell more food, some people want to put a
tax on the food imported from other countries. This is an example of a(n) tariff
8. Which might make an embargo against a country successful? The citizens in
the country suffer because of the embargo and demand a change from their
9. What is currency? money
10. What is the currency in most of the EU called? Euro
11. What is the currency of Russia? Rubles
12. What is a problem with exchanging currency? It costs more because banks
charge fees for exchanging currencies
13. What is human capital?education and training
14. What is physical capital? factories, machines, technologies, buildings,
15. What is Gross Domestic Product, or GDP? the total value of all the goods and
services produced in a country in a year
16. What is literacy? The number of people over age 15 in a country who can
read and write
17. Which is an example of investing in human capital? education
18. What is the relationship between investing in human capital and the GDP?
Usually countries that invest in human capital have higher GDPs than countries
that don’t
19. What is an example of investing in physical capital by a company?
constructing a new factory
20. What is an example of a natural resource? forests
21. Why is a country better off if it does not have to import natural resources?
Buying from other countries costs more money
22. Which is an example of an entrepreneur? a person who uses her money to
start a business selling cell phones
23. Which is a way that entrepreneurs help increase a country’s GDP? creating
businesses that give people jobs
24. What are the 3 types of economies? market, command, traditional
25. Most countries in the world are ___ economies.