UPSC Prelims Practice Questions — With tariffs stalled, U.S. President Donald Trump’s China policy drifts

Q1. In the context of U.S. trade policy in 2025, the term 'Liberation Day' tariffs, announced on April 2, 2025, refers to which one of the following?

  • A. A 10% baseline tariff on all imports combined with higher 'reciprocal' tariffs on individual trading partners, including 34% on China
  • B. A single 145% tariff imposed exclusively on all Chinese goods with no other country affected
  • C. Tariffs imposed only on national-security grounds citing Chinese links to fentanyl trafficking
  • D. A tariff waiver granted to allied nations that agreed to 'liberate' their supply chains from China

Q2. The 145% cumulative U.S. tariff on certain Chinese goods reached in April 2025 incorporated a pre-existing 20% duty. On which one of the following grounds had that 20% duty originally been imposed?

  • A. Alleged Chinese links to the fentanyl trade
  • B. China's alleged currency manipulation under Treasury findings
  • C. Intellectual-property theft findings under a Section 301 report
  • D. China's excess steel and aluminium capacity under Section 232

Q3. As part of the understanding reached around the May 2026 Trump–Xi summit, China agreed to purchase at least how much worth of U.S. agricultural products each year for 2026 (prorated), 2027 and 2028?

  • A. $17 billion
  • B. $30 billion
  • C. $50 billion
  • D. $200 billion

Q4. China's March 2025 retaliatory tariffs on U.S. agricultural goods such as soybeans, pork and beef were announced as a direct response to which one of the following U.S. measures?

  • A. The U.S. doubling of the additional tariff on Chinese imports to 20% (from 10%) on March 4, 2025
  • B. The April 2025 'Liberation Day' 34% reciprocal tariff on China
  • C. The 145% peak cumulative tariff imposed on some Chinese goods in April 2025
  • D. The December 2025 Nvidia H200 chip revenue-sharing arrangement

Q5. With reference to U.S. President Donald Trump's May 2026 visit to China, consider the following statements: 1. It was the first visit by a sitting U.S. President to China in about eight years. 2. During the visit China approved an initial purchase of 200 American-made Boeing aircraft. 3. It marked the first-ever face-to-face meeting between Donald Trump and Xi Jinping. Which of the statements given above is/are correct?

  1. It was the first visit by a sitting U.S. President to China in about eight years.
  2. During the visit China approved an initial purchase of 200 American-made Boeing aircraft.
  3. It marked the first-ever face-to-face meeting between Donald Trump and Xi Jinping.
  • A. 1 only
  • B. 1 and 2 only
  • C. 2 and 3 only
  • D. 1, 2 and 3

Q6. The reciprocal tariff-reduction framework discussed at the May 2026 Trump–Xi summit would, on the U.S. side, be negotiated and operationalised principally through which one of the following offices?

  • A. Office of the U.S. Trade Representative (USTR)
  • B. Bureau of Economic Analysis (BEA)
  • C. U.S. Census Bureau
  • D. Board of Governors of the Federal Reserve System

Q7. The headline 2025 U.S.–China goods-trade statistics (exports, imports and the bilateral deficit) are attributed to how many distinct principal U.S. agencies — namely the Census Bureau, the Office of the U.S. Trade Representative and the Bureau of Economic Analysis?

  • A. Two
  • B. Three
  • C. Four
  • D. Five

Q8. Consider the following statements about U.S. federal bodies associated with trade and economic data: 1. The Bureau of Economic Analysis (BEA) compiles the U.S. national GDP estimates and input–output tables. 2. The U.S. Census Bureau, which conducts a full economic census once every five years, functions under the Department of Commerce. 3. The Office of the U.S. Trade Representative's Section 301 authority was created only in 2018 to counter China. Which of the statements given above is/are correct?

  1. The Bureau of Economic Analysis (BEA) compiles the U.S. national GDP estimates and input–output tables.
  2. The U.S. Census Bureau, which conducts a full economic census once every five years, functions under the Department of Commerce.
  3. The Office of the U.S. Trade Representative's Section 301 authority was created only in 2018 to counter China.
  • A. 1 and 2 only
  • B. 1 and 3 only
  • C. 2 and 3 only
  • D. 1, 2 and 3

Q9. Consider the following statements about U.S. AI-chip export decisions toward China: 1. In December 2025 the Trump administration cleared Nvidia to export its advanced H200 AI chips to approved customers in China. 2. That clearance required Nvidia to remit 25% of its revenue from such China sales to the U.S. government. 3. The same December 2025 decision simultaneously imposed a blanket ban on all Nvidia AI-chip sales to China on national-security grounds. Which of the statements given above is/are correct?

  1. In December 2025 the Trump administration cleared Nvidia to export its advanced H200 AI chips to approved customers in China.
  2. That clearance required Nvidia to remit 25% of its revenue from such China sales to the U.S. government.
  3. The same December 2025 decision simultaneously imposed a blanket ban on all Nvidia AI-chip sales to China on national-security grounds.
  • A. 1 and 2 only
  • B. 1 and 3 only
  • C. 2 and 3 only
  • D. 1, 2 and 3

Q10. Consider the following item–description pairs relating to U.S. technology and trade actions toward China: 1. 'AI Diffusion Rule' — a Biden-era export-control framework that the Trump administration rolled back in 2025. 2. Nvidia H20 chip — sales to China green-lit by the Trump administration in mid-2025 after earlier curbs. 3. Nvidia H200 chip — cleared for China sales in December 2025 under a revenue-sharing arrangement. 4. 'Liberation Day' tariff — a 25% Section 301 duty first imposed on China in 2018. Which of the pairs given above is/are correctly matched?

  1. 'AI Diffusion Rule' — a Biden-era export-control framework that the Trump administration rolled back in 2025.
  2. Nvidia H20 chip — sales to China green-lit by the Trump administration in mid-2025 after earlier curbs.
  3. Nvidia H200 chip — cleared for China sales in December 2025 under a revenue-sharing arrangement.
  4. 'Liberation Day' tariff — a 25% Section 301 duty first imposed on China in 2018.
  • A. 1, 2 and 3
  • B. 2 and 4 only
  • C. 1 and 4 only
  • D. 3 only

Q11. Consider the following statements about India in the context of the 2025 U.S.–China tariff conflict: 1. Under the April 2025 U.S. reciprocal-tariff structure, India (around 26%) faced a lower rate than China, Vietnam and Thailand. 2. A NITI Aayog assessment had noted that India's success in capturing the 'China-plus-one' shift has so far been limited. 3. The 'China-plus-one' strategy denotes firms relocating entirely out of China with no continuing operations there. Which of the statements given above is/are correct?

  1. Under the April 2025 U.S. reciprocal-tariff structure, India (around 26%) faced a lower rate than China, Vietnam and Thailand.
  2. A NITI Aayog assessment had noted that India's success in capturing the 'China-plus-one' shift has so far been limited.
  3. The 'China-plus-one' strategy denotes firms relocating entirely out of China with no continuing operations there.
  • A. 1 and 2 only
  • B. 2 and 3 only
  • C. 1 and 3 only
  • D. 1, 2 and 3

Q12. The Section 301 investigation that underpinned the roughly 25% tariffs imposed on Chinese goods during Trump's first term (2018) was conducted by which U.S. body, then headed by Robert Lighthizer?

  • A. Office of the U.S. Trade Representative (USTR)
  • B. U.S. Department of the Treasury
  • C. Bureau of Economic Analysis (BEA)
  • D. U.S. International Trade Commission