Business Degree Certification Practice Test

What is one of the primary activities of the World Trade Organization (WTO)?

1. Enforcement of the Foreign Corrupt Practices Act

2. Elimination of all trade barriers between Canada, Mexico, and the U.S.

3. Stimulating international commerce and resolving trade disputes

4. Creation of trade alliances

The correct answer is: Stimulating international commerce and resolving trade disputes

The primary activity of the World Trade Organization (WTO) is to stimulate international commerce and resolve trade disputes. The WTO facilitates the smooth flow of trade by providing a framework for negotiating trade agreements and a mechanism for settling disputes between member countries. This involves ensuring that trade flows as predictably and freely as possible, reducing tariffs and other trade barriers, and promoting transparency in trade policies. The organization acts as a third party in disputes to help maintain fair competition and adherence to trade agreements, contributing to a more stable and predictable international trading environment. This central role of the WTO is crucial for countries engaging in global trade, as it helps to prevent conflicts arising from trade disagreements and fosters cooperation among nations, ultimately leading to increased economic growth. The other options listed focus on specific aspects of trade regulation or regional agreements but do not encapsulate the broader purpose and operations of the WTO as effectively as the correct choice.