ECONOMICS (CBSE/UGC NET)

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ECONOMICS

ECONOMIC SYSTEMS

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
Leading exports in Saudi Arabia:petroleum & petroleum productsLeading exports in Israel:machinery and equipment, software, cut diamonds, agricultural products, chemicals, textiles and apparel.Which statement describes the potential trading relationship between Saudi Arabia and Israel?
A
Since they both specialize, they do not make good trading partners
B
Because hey specialize in different goods, they could make good trading partners.
C
They do not use the same currency; therefore it is impossible for them to trade.
D
Petroleum is always worth more than Israel’s exports so the countries should not trade.
Explanation: 

Detailed explanation-1: -Saudi Arabia has an oil-based economy with strong government controls over major economic activities. It possesses about 16% of the world’s proven petroleum reserves, ranks as the largest exporter of petroleum, and plays a leading role in OPEC.

Detailed explanation-2: -Answer and Explanation: While Saudi Arabia experiences government control of their economy in a number of ways, it remains a primarily market economy.

Detailed explanation-3: -Today, industrial products make up more than 90 percent of the Kingdom’s non-oil exports. Saudi Arabia exports petrochemicals, plastics, metal goods, construction materials and electrical appliances to some 90 countries.

Detailed explanation-4: -The economy of Israel is a highly developed free-market economy.

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