CBSE Class 12 Geography Chapter 9 International Trade Question Answer Part 1

Class 12 Geography Chapter 9 International Trade Question Answer NCERT Textbook Questions Solved

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NCERT Solutions for Class 12 Geography Part A – Fundamentals of Human Geography Chapter 9 International Trade – Free PDF download

CBSE Class 12 Geography Chapter 9 International Trade Question Answer

1. Choose the right answer from the four alternatives given below.

(i) Most of the world’s great ports are classified as

Naval ports
Oil Ports
Comprehensive Ports
Industrial Ports

Ans. (3) Comprehensive Ports

(ii) Which one of the following continents has the maximum flow of global trade?

Asia
North America
Europe
Africa

Ans. (2) North America

(iii) Which one of the following South American nation is a part of OPEC?

Brazil
Chile
Venezuela
Peru

Ans. (3) Venezuela

(iv) In Which of the following trade blocs, is Indian an associate member?

SAFTA
OECD
ASEAN
OPEC

Ans. (1) SAFTA

2. Answer the following questions in about 30 words.

(i) What is the basic function of the World Trade Organisation?

Ans.The main functions of WTO are discussed below:

1. To implement rules and provisions related to trade policy review mechanism.

2. To provide a platform to member countries to decide future strategies related to trade and tariff.

3. To provide facilities for implementation, administration and operation of multilateral and bilateral agreements of the world trade.

4. To administer the rules and processes related to dispute settlement.

5. To ensure the optimum use of world resources.

6. To assist international organizations such as, IMF and IBRD for establishing coherence in Universal Economic Policy determination.

(ii) Why is it detrimental for a nation to have negative balance of payments?

Ans. Balance of trade records the volume of goods and services imported as well as exported by a country to other countries. If the value of imports is more than the value of a country’s
exports, the country has negative or unfavourable balance of trade. If the value of exports is more than the value of imports, then the country has a positive or favourable balance
of trade.Balance of trade and balance of payments have serious implications for a country’s
economy. A negative balance would mean that the country spends more on buying goods than it can earn by selling its goods. This would ultimately lead to exhaustion of its financial services.

(iii) What benefits do nations get by forming trading blocs?

Ans.The benefits nations get by forming trading blocs are-

(a) An increase in foreign direct investment may result from the creation of trade blocs. This can benefit the economies of participating nations by creating jobs in new or expanded businesses.

(b) The larger markets created by trade blocs permit companies to take advantage of economies of scale. Since the average cost of each good produced tends to fall as production increases, this results in lower prices for consumers.

(c) Trade blocs force the manufacturers in participating countries to compete with each other. Increased competition creates pressures for greater efficiency within firms, which results in lower prices for consumers.

(d) Trade blocs eliminate tariffs, which drives down the cost of imports. As a result, consumers can save money by buying imported goods when cheaper than locally-produced ones—they can then spend those savings on other goods. Reducing the cost of imports also reduces the cost of locally-produced goods that use imported parts or components.

(e) increased competition and the removal of tariffs, which may act as a price floor, drive down prices and allow for increased consumption. This reduces dead weightloss and hence improve market efficiency.

3. Answer the following questions in not more than 150 words.

(i) How are ports helpful for trade? Give a classification of ports on the basis of their location.

Ans. The chief gateways of the world of international trade are the harbours and ports.Port development not only accelerates the rate of international trade but also acts as a catalyst to employment and revenue effects.The beehive of activities in seaports all over the world clearly shows that ports have a significant economic impact regionally, nationally as well as internationally.

International trade is always interconnected with that of the transportation and port logistics is synonymous to the bulk and cheap transportation facilities. Thus, it can be safely concluded that if port efficiencies are taken care by that of the Nations, then it could lead to a booming economy.

Types of port on the basis of location:

(i) Inland Ports: These ports are located away from the sea coast. They are linked to the
sea through a river or a canal. Such ports are accessible to flat bottom ships or
barges. For example, Manchester is linked with a canal; Memphis is located on the river Mississippi; Rhine has several ports like Mannheim and Duisburg; and
Kolkata is located on the river Hoogli, a branch of the river Ganga.

(ii) Out Ports: These are deep water ports built away from the actual ports. These serve the parent ports by receiving those ships which are unable to approach them due to their large size. Classic combination,for example, is Athens and its out port
Piraeus in Greece.

(ii) How do nations gain from International Trade?

Ans. International trade has flourished over the years due to the many benefits it has offered to different countries across the globe. International trade is the exchange of services, goods, and capital among various countries and regions, without much hindrance. The international trade accounts for a good part of a country’s gross domestic product. It is also one of important sources of revenue for a developing country.

The benefits of international trade have been the major drivers of growth for the last half of the 20th century. Nations with strong international trade have become prosperous and have the power to control the world economy. The global trade can become one of the major contributors to the reduction of poverty.

The gains from International Trade are-

1) Greater Variety of Goods Available for Consumption:

International trade brings in different varieties of a particular product from different destinations. This gives consumers a wider array of choices which will not only improve their quality of life but as a whole it will help the country grow.

2) Efficient Allocation and Better Utilization of Resources:

Efficient allocation and better utilization of resources since countries tend to produce goods in which they have a comparative advantage. When countries produce through comparative advantage, wasteful duplication of resources is prevented. It helps save the environment from harmful gases being leaked into the atmosphere and also provides countries with a better marketing power.

3) Promotes Efficiency in Production:

International trade promotes efficiency in production as countries will try to adopt better methods of production to keep costs down in order to remain competitive. Countries that can produce a product at me lowest possible cost will be able to gain larger share in the market.

Therefore an incentive to produce efficiently arises. This will help to increase the standards of the product and consumers will have a good quality product to consume.

4) More Employment:

More employment could be generated as the market for the countries’ goods widens through trade. International trade helps generate more employment through the establishment of newer industries to cater to the demands of various countries. This will help countries to bring-down their unemployment rates.

5) Consumption at Cheaper Cost:

International trade enables a country to consume things which either cannot be produced within its borders or production may cost very high. Therefore it becomes cost cheaper to import from other countries through foreign trade.

6) Reduces Trade Fluctuations:

By making the size of the market large with large supplies and extensive demand international trade reduces trade fluctuations. The prices of goods tend to remain more stable.

7) Utilization of Surplus Produce:

International trade enables different countries to sell their surplus products to other countries and earn foreign exchange.

8) Fosters Peace and Goodwill:

International trade fosters peace, goodwill, and mutual understanding among nations. Economic interdependence of countries often leads to close cultural relationship and thus avoid war between them.

NCERT Solutions Class 12th Geography Question Answer Free Download

CBSE Class 12th Geography Question Answer: Fundamentals of Human Geography

NCERT Books Solutions for Class 12 Geography Question and Answer: Fundamentals of Human Geography

CBSE Class 12 Geography Question Answer: India People and Economy

NCERT Solutions for Class 12 Geography: India People and Economy

International Trade Important Extra Questions Very Short Answer Type

Question 1.
To which category of activities does trade belong ?
Answer:
Tertiary.

Question 2.
Name two types of trade.
Answer:
International and national.

Question 3.
What was the initial form of trade ?
Answer:
Barter system.

Question 4.
What does word ‘Salary’ mean ?
Answer:
It comes from the Latin word Solarium meaning payment by salt which was rare and expensive.

Question 5.
What was the length of Silk Route ?
Answer:
It was 6000 km long form Rome to China.

Question 6.
When was slave trade abolished in USA ?
Answer:
In 1808.

Question 7.
Name three products which are exported from tropical regions.
Answer:
Bananas, Rubber and Cocoa.

Question 8.
Name three aspects of international trade.
Answer:
Volume, sectoral composition and direction of trade.

Question 9.
What is positive balance of trade ? (C.B.S.E. 2013)
Answer:
If the value of exports is more than that of imports.

Question 10.
What is negative balance of trade ?
Answer:
If the value of imports is more than that of exports.

Question 11.
Expand MFN.
Answer:
Most Favoured Nation.

Question 12.
When was WTO formed ?
Answer:
On 1st January, 1995.

Question 13.
Expand WTO.
Answer:
World Trade Organisation.

Question 14.
What do you mean by GATT ?
Answer:
General Agreement on Trade and Tariffs.

Question 15.
Expand OPEC.
Answer:
Organisation of Petroleum Exporting Countries.

Question 16.
Mention any two problems of barter system. (Delhi 2019)
Answer:
(i) Double coincidence of wants.
(ii) Lack of information.

International Trade Important Extra Questions Short Answer Type

Question 1.
What do you mean by trade ?
Answer:
The term trade simply means the voluntary exchange of goods and services. Trade is one of the most important human (economic) activities. It refers to the movement of goods and services from areas of surplus to areas of deficit. In simple words, it is exchange of products or marketing between nations and regions. For both the parties, trade is mutually beneficial.

Question 2.
What is barter system ? (C.B.S.E. 2013)
Answer:
The initial form of trade in primitive societies was the barter system. In this, direct exchange of goods takes place. Two parties sell and purchase their products by exchanging these.

Question 3.
Where is barter system practised in India ?
Answer:
Every January, after the harvest season, Jon Beel Mela takes place in Jagirod, 35 km away from Guwahati. It is, the only fair in India where barter system is alive among tribes and communities.

Question 4.
Describe the different forms of art and craft developed in certain countries.
Answer:
(i) China produces the finest porcelains and brocades.
(ii) Iran is famous for carpets.
(iii) North Africa is famous for leather work.
(iv) Indonesian batik cloth is valuable.

Question 5.
Name the major items of merchandise which are traded over the world.
Answer:
The major items of merchandise traded over the world include the following :

machinary and equipment
fuel, minerals
office and telecom equipment
chemicals and automobiles
iron and steel
clothing and utensils.

Question 6.
What are Oil ports ? Give examples.
Answer:
Oil Ports. These ports deal in the processing and shipping of oil. Some of these are tanker ports and some are refinery ports. Maracaibo in Venezuela, Esskhira in Tunisia, Tripoli in Lebanon are tanker ports. Abadan on the Gulf of Persia is a refinery port.

Question 7.
What are Naval ports ? What [Mill are their functions ? Give two examples from India. (C.B.S.E. 2013)
Answer:
Naval Ports. These are the ports which have only strategic importance. These ports serve the warships and have repair workshops for them. Kochi and Karwar are the examples of such ports in India.

Question 8.
What are Entrepot ports ? Give one example.
Answer:
Entrepot Ports. These are collection centers where the goods are brought from different countries for export. Singapore is an entrepot for Asia. Rotterdam for Europe, and Copenhagen for the Baltic region.

Question 9.
Distinguish between International and National Trade.
Answer:
Trade may be classified into two levels : international and national. International trade is the exchange of goods and services among countries across national boundaries. Countries need to trade to obtain commodities they cannot produce themselves or they can purchase elsewhere at a lower cost. When trade occurs between different states of a country, it is called national trade.

Question 10.
What do you know about the Silk Route?
Answer:
The Silk Route is an early example of long distance trade connecting Rome to China— along 6000 km route, and the trade transported Chinese silk, Roman wool and precious metals and many other high value commodities from intermediate points in India, Persia and Central Asia.

Question 11.
Distinguish between Bilateral trade and Multi-lateral trade. (C.B.S.E. 2013-2014)
Answer:
(i) Bilateral trade. Bilateral trade is done by two countries with each other. They enter into an agreement to trade specified commodities against them. A country may import raw materials against export of manufactured goods.
(ii) Multi-lateral trade. Multilateral trade is conducted with many trading countries. The same country can trade with a number of countries. Some countries are granted the status of most favoured nation.

Question 12.
What is free trade ? What are its effects ? (C.B.S.E. 2013)
Or
Mention any two ill effects of free trade and economic globalization. (Delhi 2019)
Answer:
The act of opening up economies for trading is known as free trade or trade liberalisation. This is done by bringing down trade barriers like tariffs. It allows goods and services from anywhere to compete with domestic products.

Effects. It adversely affects the economies of developing countries. They impose unfavourable conditions. Free trade should not let rich countries enter the markets. They should allow the developed countries to keep their own markets protected from foreign products. Free trade does not make the lives of ordinary people more prosperous. It is actually widening the gap between the rich and the poor by making rich countries richer.

Question 13.
How will increasing international trade affect global environment ?
Answer:
Global trade affects many aspects of life :
(i) It can impact everything from the environment to health and well being of the people around the world.

(ii) As countries compete to trade more, production and the use of natural resources spiral up, resources get used up faster than they can be replenished.

(iii) The marine life is also depleting fast, forests are being cut down and river basins sold off to private drinking water companies.

(iv) Multinational Corporations trading in oil, gas mining, pharmaceuticals and agri-business keep expanding their operations at all costs creating more pollutions

(v) Their mode of work does not follow the norms of sustainable development. If organisations are geared only towards profit making, and environmental and health concerns are not addressed, then it could lead to serious implications in the future.

Question 14.
International trade is beneficial to [ both exporting and importing countries.Discuss.
Answer:
The exchange of surplus goods between different countries is called international trade. The countries with surplus production export the particular goods. These countries benefit by earning foreign exchange. Some densely populated countries have to import goods to meet the demand.

These countries depend on the import of raw materials for their economic and industrial development. The economy of Sri Lanka depends upon export of tea. The industrial development of Japan depends upon the import of raw materials.

Question 15.
‘International trade is known as the barometer of economic development of a country.’Why ?
Or
“In modern times international trade is the basis of the world economy.” Support the statment with examples. (C.B.S.E.Outside Delhi 2017)
Answer:
International trade is the index of economic development of a country. International trade has increased manifold during the last forty years. This increase has been due to developed technology and the rapid means of transportation.

Now-a-days, the developed countries are major trading countries. On the other hand, developing countries have a low level of trade. The industrialized countries import raw materials and- export manufactured goods to earn foreign exchange. It helps to raise the standard of living of people of these countries. Thus the per capita trade represents the economic development of a country. But in countries of large population, the per capita trade is low despite the fact that the total amount of trade is high.

Question 16.
Why are the ports called ‘gateway^ of international trade’ ?
Answer:
Port. A port is a place on the coast which provides facilities such as docking, loading and unloading and storage facilities of cargo. A port handles the import and export trade of a country. A port is connected with its hinterland by rail-road transport. These land routes are used to transport the goods to a port from where these goods are exported through ocean routes.

Similarly, imports are sent to the hinterland of a port. In fact, a port acts as a point of entry for the goods received from foreign countries and a point of exit for the goods produced in its hinterland. Therefore, a port is called a gateway of international trade. For example, Kolkata is a commercial gateway for its hinterland comprising states of West Bengal, Bihar, Assam.

Question 17.
Name the geographical conditions necessary for the development of an ideal port.
Answer:
A port handles the import-export trade of a country. It acts as a commercial gateway for its hinterland. The following conditions favour the development of an ideal port:

Presence of protected Harbour.
A deep water natural harbour is required.
Sufficient space is required for docking facilities.
The hinterland should be well connected with the port by rail-road routes.
A rich hinterland is required.
Favourable climate so that the port remains open throughout the year.
Fuel facilities should be available.

Question 18.
What is the role of ‘World Trade Organisations’ as an international organisation ? Why has the World Trade Organisation been criticised by some countries? Explain the role of World Trade Organisation. (C.B.S.E. 2014)
Answer:
Role of WTO :

It formulates the global rules of trade between countries.
It resolves disputes between its member nations.
It covers trade in services particularly banking and communication facilities.

Criticism :

Some countries criticise WTO due to effects of free trade.
It widens the gap between the rich and poor nations.
WTO focuses on the commercial interests.
It ignores the issues of environmental pollution, health, right of workers and child labour

Question 19.
Distinguish between Barter trade and Monetary trade.
Answer:

Barter Trade	Monetary Trade
1. It is the earliest form of local trade. 2. Barter system means the exchange of goods without the use of money. 3. It is limited in nature and has the difficulty of rate of exchange of goods.	1. It is modern system of international trade. 2. Monetary system means the exchange of goods where one item is exchanged for the other. 3. It is used for trade of a number of commodities from different countries.

Question 20.
Distinguish between National trade and International trade.
Answer:

National Trade	International Trade
1. National trade means the wholesale trade on a large scale within the boundaries of a country’. 2. Tt is also known as internal trade. 3. National trade depends upon the extent of a country.	1. International trade means exchange of goods, services, capital across the national boundaries. 2. It is also known as foreign trade. 3. Internationa trade depends upon the surplus production and purchasing power

Question 21.
Distinguish between favourable balance of trade and unfavourable balance of trade.
Or
What is meant by balance of trade?
Answer:

Favourable balance	Unfavourable balance
1. When there is an excess of exports, it is called a favourable balance of trade. 2. In 1976-77 in India, the imports were of value = 5073 crore rupees while exports were of value = 5142 crore rupees. Balance of trade was + 69 crore rupees. 3. It helps to strengthen the economy of a country.	1. When there is an excess of imports, it is called an unfavourable balance of trade. 2. In India, in 1982-83. imports were of value = 14047 crore rupees. exports were of value = 8637 crore rupees. Balance of trade was 5410 crore rupees. 3. It creates problems for the economy of a country.