1.

What is a significant factor contributing to the explosion in international commerce, as

discussed in the reading?
D . Decrease in transportation costs
=> : "But one force behind the import-export boom has passed all but unnoticed: the rapidly
falling cost of getting goods to market."

2. What is the theoretical assumption about the movement of goods in the world of trade?
A. Goods move instantly with no cost from place to place.
=> : "Theoretically, in the world of trade, shipping costs do not matter. Goods, once they
have been made, are assumed to move instantly and at no cost from place to place."

3. What was the dominant nature of international commerce at the turn of the 20th century?
B. Raw materials and processed commodities.
=> : "International commerce was therefore dominated by raw materials, such as wheat,
wood and iron ore, or processed commodities, such as meat and steel."

4. How has the composition of trade shifted over time?

C. Towards goods unrelated to size and weight**
=> : "Today, it is finished manufactured products that dominate the flow of trade, and, thanks
to technological advances such as lightweight components, manufactured goods themselves
have tended to become lighter and less bulky."

5. What technological advancement has contributed to the decrease in transportation costs

for manufactured goods?
C. Advancement in lightweight components.
=> : "Thanks to technological advances such as lightweight components, manufactured
goods themselves have tended to become lighter and less bulky."

6. According to the reading, where is most of the world's disk-drive manufacturing

concentrated?
C. South-east Asia
=> : "Most of the world's disk-drive manufacturing is concentrated in South-east Asia."

7. What makes it possible for disk drive manufacturing to be concentrated in South-east

Asia?
C. Lightweight and small size of disk drives
=> : "This is possible only because disk drives, while valuable, are small and light and so
cost little to ship."

8. How does the decrease in transportation costs affect the globalisation of industries?
C. It reduces the significance of geographic distance.
=> : "Distance therefore poses no obstacle to the globalisation of the disk-drive industry."

9. What percentage of total output did agriculture and manufacturing account for at the turn
of the 20th century, according to the reading?
B. 70%
=> : "At the turn of the 20th century, agriculture and manufacturing were the two most
important sectors almost everywhere, accounting for about 70% of total output..."
10. What is highlighted as a potential drawback if delays in shipment occur, according to the
reading?
C. Loss of trade advantages
=> : "...but if delays in shipment tie up working capital and cause winter coats to arrive in
spring, trade may lose its advantages."