WGU C211 OA Global Economics Exam
2026/2027: Actual Questions with Verified
Answers – Complete Study Guide – 100%
Guaranteed Pass – Graded A+
COMPETENCY 1: GLOBALIZATION AND INTERNATIONAL TRADE THEORY
(Questions 1-20)
Q1: Which view of globalization claims that the phenomenon was initially driven by the
desire of Western economies to exploit their power through multinational enterprises
(MNEs)?
A. Evolutionary view
B. Pendulum view
C. New view
D. Classical view
Correct Answer: C - ✔✔
Rationale: The "new view" of globalization suggests it is a recent phenomenon driven by
Western economies seeking to exploit their power through MNEs. The evolutionary view
(A) sees globalization as a long-run historical evolution since the dawn of humanity. The
pendulum view (B) sees it swinging back and forth over time. Classical view (D) refers
to trade theories, not views of globalization.
,(Competency: 1-Globalization | Difficulty: Easy)
Q2: What is the term for the theory that the wealth of the world is fixed and that a
nation that imports more and exports less will be richer?
A. Absolute advantage
B. Comparative advantage
C. Mercantilism
D. Free trade
Correct Answer: C - ✔✔
Rationale: Mercantilism is the classical trade theory that views international trade as a
zero-sum game with fixed world wealth, advocating government protection of domestic
industries and promotion of exports. Absolute advantage (A) focuses on specialization
in what a nation produces most efficiently. Comparative advantage (B) focuses on
opportunity cost differences. Free trade (D) is the opposite of mercantilism's
protectionist approach.
(Competency: 1-Globalization | Difficulty: Easy)
Q3: Which view of globalization claims that globalization is swinging from one extreme
to another from time to time, neither recent nor one-directional?
A. New view
B. Evolutionary view
C. Pendulum view
D. Resource-based view
Correct Answer: C - ✔✔
,Rationale: The pendulum view claims globalization swings between extremes over
time—it is neither recent nor one-directional. The new view (A) sees it as recent and
Western-driven. The evolutionary view (B) sees it as continuous since humanity's dawn.
The resource-based view (D) focuses on firm-specific resources, not globalization
patterns.
(Competency: 1-Globalization | Difficulty: Easy)
Q4: According to the theory of absolute advantage, under free trade:
A. Each nation should protect its domestic industries
B. Each nation gains by specializing in activities where it has absolute advantage
C. Nations should focus on what they import most
D. Government intervention is always necessary
Correct Answer: B - ✔✔
Rationale: Absolute advantage theory states that under free trade, each nation gains by
specializing in economic activities where it has absolute advantage (can produce more
efficiently than others). This stems from factor endowments. Option A describes
mercantilism. Option C is economically illogical. Option D contradicts free trade
principles.
(Competency: 1-Globalization | Difficulty: Medium)
Q5: The theory of comparative advantage focuses on:
A. Only countries with absolute advantage can benefit from trade
B. Countries should specialize where opportunity costs are lowest, even without
absolute advantage
C. Government protection of all domestic industries
D. Zero-sum game perspectives
, Correct Answer: B - ✔✔
Rationale: Comparative advantage (David Ricardo) shows that even without absolute
advantage, countries benefit by specializing in goods where they have lower opportunity
costs. Patterns of trade may change over time based on factor endowments. Option A
contradicts the theory. Options C and D describe mercantilism.
(Competency: 1-Globalization | Difficulty: Medium)
Q6: In the Product Life Cycle Theory, during the "new stage," production concentrates
in:
A. Low-cost developing nations
B. The United States, which exports to other developed nations
C. Any country with available labor
D. Countries with the lowest tariffs
Correct Answer: B - ✔✔
Rationale: In the new stage, innovative products commanding price premiums
concentrate in the U.S., which exports to other developed nations. In the maturing stage
(A is incorrect), production moves to other developed nations. In the standardized stage,
production shifts to low-cost developing nations.
(Competency: 1-Globalization | Difficulty: Medium)
Q7: During which stage of the product life cycle does production move to low-cost
developing nations that export to developed nations?
A. New stage
B. Maturing stage
C. Standardized stage
2026/2027: Actual Questions with Verified
Answers – Complete Study Guide – 100%
Guaranteed Pass – Graded A+
COMPETENCY 1: GLOBALIZATION AND INTERNATIONAL TRADE THEORY
(Questions 1-20)
Q1: Which view of globalization claims that the phenomenon was initially driven by the
desire of Western economies to exploit their power through multinational enterprises
(MNEs)?
A. Evolutionary view
B. Pendulum view
C. New view
D. Classical view
Correct Answer: C - ✔✔
Rationale: The "new view" of globalization suggests it is a recent phenomenon driven by
Western economies seeking to exploit their power through MNEs. The evolutionary view
(A) sees globalization as a long-run historical evolution since the dawn of humanity. The
pendulum view (B) sees it swinging back and forth over time. Classical view (D) refers
to trade theories, not views of globalization.
,(Competency: 1-Globalization | Difficulty: Easy)
Q2: What is the term for the theory that the wealth of the world is fixed and that a
nation that imports more and exports less will be richer?
A. Absolute advantage
B. Comparative advantage
C. Mercantilism
D. Free trade
Correct Answer: C - ✔✔
Rationale: Mercantilism is the classical trade theory that views international trade as a
zero-sum game with fixed world wealth, advocating government protection of domestic
industries and promotion of exports. Absolute advantage (A) focuses on specialization
in what a nation produces most efficiently. Comparative advantage (B) focuses on
opportunity cost differences. Free trade (D) is the opposite of mercantilism's
protectionist approach.
(Competency: 1-Globalization | Difficulty: Easy)
Q3: Which view of globalization claims that globalization is swinging from one extreme
to another from time to time, neither recent nor one-directional?
A. New view
B. Evolutionary view
C. Pendulum view
D. Resource-based view
Correct Answer: C - ✔✔
,Rationale: The pendulum view claims globalization swings between extremes over
time—it is neither recent nor one-directional. The new view (A) sees it as recent and
Western-driven. The evolutionary view (B) sees it as continuous since humanity's dawn.
The resource-based view (D) focuses on firm-specific resources, not globalization
patterns.
(Competency: 1-Globalization | Difficulty: Easy)
Q4: According to the theory of absolute advantage, under free trade:
A. Each nation should protect its domestic industries
B. Each nation gains by specializing in activities where it has absolute advantage
C. Nations should focus on what they import most
D. Government intervention is always necessary
Correct Answer: B - ✔✔
Rationale: Absolute advantage theory states that under free trade, each nation gains by
specializing in economic activities where it has absolute advantage (can produce more
efficiently than others). This stems from factor endowments. Option A describes
mercantilism. Option C is economically illogical. Option D contradicts free trade
principles.
(Competency: 1-Globalization | Difficulty: Medium)
Q5: The theory of comparative advantage focuses on:
A. Only countries with absolute advantage can benefit from trade
B. Countries should specialize where opportunity costs are lowest, even without
absolute advantage
C. Government protection of all domestic industries
D. Zero-sum game perspectives
, Correct Answer: B - ✔✔
Rationale: Comparative advantage (David Ricardo) shows that even without absolute
advantage, countries benefit by specializing in goods where they have lower opportunity
costs. Patterns of trade may change over time based on factor endowments. Option A
contradicts the theory. Options C and D describe mercantilism.
(Competency: 1-Globalization | Difficulty: Medium)
Q6: In the Product Life Cycle Theory, during the "new stage," production concentrates
in:
A. Low-cost developing nations
B. The United States, which exports to other developed nations
C. Any country with available labor
D. Countries with the lowest tariffs
Correct Answer: B - ✔✔
Rationale: In the new stage, innovative products commanding price premiums
concentrate in the U.S., which exports to other developed nations. In the maturing stage
(A is incorrect), production moves to other developed nations. In the standardized stage,
production shifts to low-cost developing nations.
(Competency: 1-Globalization | Difficulty: Medium)
Q7: During which stage of the product life cycle does production move to low-cost
developing nations that export to developed nations?
A. New stage
B. Maturing stage
C. Standardized stage
