Question 1

A difference between a quota and a tariff is that

Accepted Answer

A) a tariff generates a higher price than does an import quota. 
B) a tariff generates a greater reduction in exports than does an import quota. 
C) an import quota increases profits of domestic producers more than a tariff. 
D) the government collects revenue from a tariff but does not collect revenue from an import quota. 
E) an import quota generates a deadweight loss and a tariff does not. 
A) a tariff generates a higher price than does an import quota. 
B) a tariff generates a greater reduction in exports than does an import quota. 
C) an import quota increases profits of domestic producers more than a tariff. 
D) the government collects revenue from a tariff but does not collect revenue from an import quota. 
E) an import quota generates a deadweight loss and a tariff does not.

Question 2

The fundamental force that drives international trade is

Accepted Answer

A) absolute advantage. 
B) tariffs. 
C) the balance of trade. 
D) export advantage. 
E) comparative advantage. 
A) absolute advantage. 
B) tariffs. 
C) the balance of trade. 
D) export advantage. 
E) comparative advantage.

Question 3

Refer to the figure below to answer the following questions.   Figure 7.2.1
The figure shows the market for shirts in Canada,where D is the domestic demand curve and S is the domestic supply curve.The world price is $20 per shirt.
-In Figure 7.2.1,if the economy moves from no trade to international trade,total surplus in Canada ________ by ________.

Accepted Answer

A) increases;$128 million 
B) decreases;$192 million 
C) increases;$320 million 
D) decreases;$256 million 
E) decreases;$128 million 
A) increases;$128 million 
B) decreases;$192 million 
C) increases;$320 million 
D) decreases;$256 million 
E) decreases;$128 million

Question 4

Refer to the figure below to answer the following questions.   Figure 7.2.2
The figure shows the market for helicopters in Canada,where D is the domestic demand curve and S is the domestic supply curve.The world price is $36 million per helicopter.
-In Figure 7.2.2,if the economy moves from no trade to international trade,producer surplus in Canada ________ by ________.

Accepted Answer

A) decreases;$2.88 billion 
B) decreases;$1.92 billion 
C) increases;$4.8 billion 
D) increases;$3.6 billion 
E) decreases;$4.8 billion 
A) decreases;$2.88 billion 
B) decreases;$1.92 billion 
C) increases;$4.8 billion 
D) increases;$3.6 billion 
E) decreases;$4.8 billion

Question 5

Suppose the country of Mooland imposes tariffs on imported beef from the country of Aqualand.As a result of the tariffs,the

Accepted Answer

A) price of beef in Mooland falls. 
B) quantity of beef exported by Mooland increases. 
C) quantity of beef imported by Mooland decreases. 
D) quantity of beef imported by Mooland increases. 
E) price of beef in Mooland does not change. 
A) price of beef in Mooland falls. 
B) quantity of beef exported by Mooland increases. 
C) quantity of beef imported by Mooland decreases. 
D) quantity of beef imported by Mooland increases. 
E) price of beef in Mooland does not change.

Question 6

Who benefits from imports?

Accepted Answer

A) domestic consumers 
B) domestic producers 
C) foreign consumers 
D) domestic workers in the industry 
E) suppliers to the domestic industry 
A) domestic consumers 
B) domestic producers 
C) foreign consumers 
D) domestic workers in the industry 
E) suppliers to the domestic industry

Question 7

If a country imposes a tariff on an imported good,the tariff ________ the price in the importing country and ________ the quantity of imports.

Accepted Answer

A) raises;increases 
B) raises;does not change 
C) lowers;does not change 
D) lowers;increases 
E) raises;decreases 
A) raises;increases 
B) raises;does not change 
C) lowers;does not change 
D) lowers;increases 
E) raises;decreases

Question 8

Refer to the figure below to answer the following questions.   Figure 7.3.1
The figure shows the market for shirts in Canada,where D is the domestic demand curve and S is the domestic supply curve.The world price is $20 per shirt.Canada imposes a tariff on imported shirts of $4 per shirt.
-Refer to Figure 7.3.1.The tariff ________ the domestic production of shirts in Canada by ________ per year.

Accepted Answer

A) increases;8 million 
B) decreases;16 million 
C) increases;4 million 
D) decreases;8 million 
E) increases;24 million 
A) increases;8 million 
B) decreases;16 million 
C) increases;4 million 
D) decreases;8 million 
E) increases;24 million

Question 9

Among the following,the domestic government gains the most revenue when it

Accepted Answer

A) imposes an import quota. 
B) eliminates an import quota. 
C) encourages freer trade. 
D) imposes a tariff. 
E) increases the demand for a domestically-produced good. 
A) imposes an import quota. 
B) eliminates an import quota. 
C) encourages freer trade. 
D) imposes a tariff. 
E) increases the demand for a domestically-produced good.

Question 10

Refer to the table below to answer the following questions.
Table 7.1.2
  
-Table 7.1.2 shows a country's demand and supply schedules for a good.At what world price would the country import this good?

Accepted Answer

A) at exactly $8 a unit 
B) any price above $8 a unit 
C) a price of $10 a unit 
D) a price of $20 a unit 
E) a price below $8 a unit 
A) at exactly $8 a unit 
B) any price above $8 a unit 
C) a price of $10 a unit 
D) a price of $20 a unit 
E) a price below $8 a unit

Question 11

Of the following,in which decade were Canada's tariffs at their lowest level?

Accepted Answer

A) 2000s 
B) 1970s 
C) 1950s 
D) 1930s 
E) 1890s 
A) 2000s 
B) 1970s 
C) 1950s 
D) 1930s 
E) 1890s

Question 12

Canada produces both lumber and wine.Canada exports lumber and imports wine.The rest of the world imports Canadian lumber and exports wine to Canada.Canada has a comparative advantage in producing ________.The rest of the world has a comparative advantage in producing ________.

Accepted Answer

A) lumber;wine 
B) wine;lumber 
C) wine;wine 
D) lumber;lumber 
E) lumber and wine;lumber and wine 
A) lumber;wine 
B) wine;lumber 
C) wine;wine 
D) lumber;lumber 
E) lumber and wine;lumber and wine

Question 13

Use the information below to answer the following questions.
Fact 7.3.1
Before 1995,trade between Canada and Mexico was subject to tariffs.In 1995,Mexico joined NAFTA and all Canadian and Mexican tariffs have gradually been removed.
-Refer to Fact 7.3.1.When Canadian tariffs are removed from a good,Canadian consumers of the good ________,and Canadian producers of the good ________.

Accepted Answer

A) gain;lose 
B) gain;gain 
C) lose;gain 
D) lose;lose 
E) and the Canadian government gain;lose 
A) gain;lose 
B) gain;gain 
C) lose;gain 
D) lose;lose 
E) and the Canadian government gain;lose

Question 14

Import quotas and tariffs both

Accepted Answer

A) decrease deadweight loss. 
B) cause a loss of revenue to domestic producers. 
C) lower prices on imported goods. 
D) decrease producer surplus. 
E) restrict foreign trade. 
A) decrease deadweight loss. 
B) cause a loss of revenue to domestic producers. 
C) lower prices on imported goods. 
D) decrease producer surplus. 
E) restrict foreign trade.

Question 15

The introduction of a tariff ________ consumer surplus and ________ total surplus.

Accepted Answer

A) increases;decreases 
B) increases;increases 
C) decreases;does not change 
D) decreases;decreases 
E) decreases;increases 
A) increases;decreases 
B) increases;increases 
C) decreases;does not change 
D) decreases;decreases 
E) decreases;increases

A difference between a quota and a tariff is that

The fundamental force that drives international trade is

Suppose the country of Mooland imposes tariffs on imported beef from the country of Aqualand.As a result of the tariffs,the

Who benefits from imports?

If a country imposes a tariff on an imported good,the tariff the price in the importing country and the quantity of imports.

Among the following,the domestic government gains the most revenue when it

Refer to the table below to answer the following questions. Table 7.1.2 -Table 7.1.2 shows a country's demand and supply schedules for a good.At what world price would the country import this good?

Of the following,in which decade were Canada's tariffs at their lowest level?

Canada produces both lumber and wine.Canada exports lumber and imports wine.The rest of the world imports Canadian lumber and exports wine to Canada.Canada has a comparative advantage in producing .The rest of the world has a comparative advantage in producing .

Import quotas and tariffs both

The introduction of a tariff consumer surplus and total surplus.

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Utility and Demand

Possibilities, preferences, and Choices

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Public Goods and Common Resources

Markets for Factors of Production

Economic Inequality

Filters

Exam 7: Global Markets in Action

A difference between a quota and a tariff is that

The fundamental force that drives international trade is

Suppose the country of Mooland imposes tariffs on imported beef from the country of Aqualand.As a result of the tariffs,the

Who benefits from imports?

If a country imposes a tariff on an imported good,the tariff ________ the price in the importing country and ________ the quantity of imports.

Among the following,the domestic government gains the most revenue when it

Refer to the table below to answer the following questions. Table 7.1.2 -Table 7.1.2 shows a country's demand and supply schedules for a good.At what world price would the country import this good?

Of the following,in which decade were Canada's tariffs at their lowest level?

Canada produces both lumber and wine.Canada exports lumber and imports wine.The rest of the world imports Canadian lumber and exports wine to Canada.Canada has a comparative advantage in producing ________.The rest of the world has a comparative advantage in producing ________.

Import quotas and tariffs both

The introduction of a tariff ________ consumer surplus and ________ total surplus.

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Utility and Demand

Possibilities, preferences, and Choices

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Public Goods and Common Resources

Markets for Factors of Production

Economic Inequality

Filters

If a country imposes a tariff on an imported good,the tariff the price in the importing country and the quantity of imports.

Canada produces both lumber and wine.Canada exports lumber and imports wine.The rest of the world imports Canadian lumber and exports wine to Canada.Canada has a comparative advantage in producing .The rest of the world has a comparative advantage in producing .

The introduction of a tariff consumer surplus and total surplus.