Question 1

Which of the following statements regarding partial equilibrium analysis is false?

Accepted Answer

A) It relies on traditional demand and supply curves 
B) it isolates for study one market 
C) it can be used to determine the equilibrium relative commodity price but not the equilibrium quantity with trade 
D) none of the above 
A) It relies on traditional demand and supply curves 
B) it isolates for study one market 
C) it can be used to determine the equilibrium relative commodity price but not the equilibrium quantity with trade 
D) none of the above C

Question 2

If the nation's tastes for its import commodity increases:

Accepted Answer

A) the nation's terms of trade remain unchanged 
B) the nation's terms of trade deteriorate 
C) the partner's terms of trade deteriorate 
D) any of the above 
A) the nation's terms of trade remain unchanged 
B) the nation's terms of trade deteriorate 
C) the partner's terms of trade deteriorate 
D) any of the above B

Question 3

In what way does partial equilibrium analysis differ from general equilibrium analysis?

Accepted Answer

A) The former but not the latter can be used to determine the equilibrium price with trade 
B) the former but not the latter can be used to determine the equilibrium quantity with trade 
C) the former but not the latter takes into consideration the interaction among all markets in the economy 
D) the former gives only an approximation to the answer sought. 
A) The former but not the latter can be used to determine the equilibrium price with trade 
B) the former but not the latter can be used to determine the equilibrium quantity with trade 
C) the former but not the latter takes into consideration the interaction among all markets in the economy 
D) the former gives only an approximation to the answer sought. D

Question 4

If a nation does not affect world prices by its trading,its offer curve:

Accepted Answer

A) is a straight line 
B) bulges toward the axis measuring the import commodity 
C) intersects the straight-line segment of the world's offer curve 
D) intersects the positively-sloped portion of the world's offer curve 
A) is a straight line 
B) bulges toward the axis measuring the import commodity 
C) intersects the straight-line segment of the world's offer curve 
D) intersects the positively-sloped portion of the world's offer curve

Question 5

Export prices must rise for a nation to increase its exports because the nation:

Accepted Answer

A) incurs increasing opportunity costs in export production 
B) faces decreasing opportunity costs in producing import substitutes 
C) faces decreasing marginal rate of substitution in consumption 
D) all of the above 
A) incurs increasing opportunity costs in export production 
B) faces decreasing opportunity costs in producing import substitutes 
C) faces decreasing marginal rate of substitution in consumption 
D) all of the above

Question 6

If the tastes for a nation import commodity increases,trade volume:

Accepted Answer

A) increases 
B) declines 
C) remains unchanged 
D) any of the above 
A) increases 
B) declines 
C) remains unchanged 
D) any of the above

Question 7

If the nation's tastes for its import commodity increases:

Accepted Answer

A) the nation's offer curve rotates toward the axis measuring its import commodity 
B) the partner's offer curve rotates toward the axis measuring its import commodity 
C) the partner's offer curve rotates toward the axis measuring its export commodity 
D) the nation's offer curve rotates toward the axis measuring its export commodity 
A) the nation's offer curve rotates toward the axis measuring its import commodity 
B) the partner's offer curve rotates toward the axis measuring its import commodity 
C) the partner's offer curve rotates toward the axis measuring its export commodity 
D) the nation's offer curve rotates toward the axis measuring its export commodity

Question 8

If the terms of trade of a nation are 1.5 in a two-nation world,those of the trade partner are:

Accepted Answer

A) 3/4 
B) 2/3 
C) 3/2 
D) 4/3 
A) 3/4 
B) 2/3 
C) 3/2 
D) 4/3

Question 9

The offer curve of a nation bulges toward the axis measuring the nations

Accepted Answer

A) import commodity 
B) export commodity 
C) export or import commodity 
D) nontraded commodity 
A) import commodity 
B) export commodity 
C) export or import commodity 
D) nontraded commodity

Question 10

A deterioration of a nation's terms of trade causes the nation's welfare to:

Accepted Answer

A) deteriorate 
B) improve 
C) remain unchanged 
D) any of the above 
A) deteriorate 
B) improve 
C) remain unchanged 
D) any of the above

Question 11

Which of the following statements is correct?

Accepted Answer

A) The demand for imports is given by the excess demand for the commodity 
B) the supply of exports is given by the excess supply of the commodity 
C) the supply curve of exports is flatter than the total supply curve of the commodity 
D) all of the above 
A) The demand for imports is given by the excess demand for the commodity 
B) the supply of exports is given by the excess supply of the commodity 
C) the supply curve of exports is flatter than the total supply curve of the commodity 
D) all of the above

Question 12

The offer curve of a nation shows:

Accepted Answer

A) the supply of a nation's imports 
B) the demand for a nation's exports 
C) the trade partner's demand for imports and supply of exports 
D) the nation's demand for imports and supply of exports 
A) the supply of a nation's imports 
B) the demand for a nation's exports 
C) the trade partner's demand for imports and supply of exports 
D) the nation's demand for imports and supply of exports

Question 13

At a relative commodity price above equilibrium

Accepted Answer

A) the excess demand for a commodity exceeds the excess supply of the commodity 
B) the quantity demanded of imports exceeds the quantity supplied of exports 
C) the commodity price will fall 
D) all of the above 
A) the excess demand for a commodity exceeds the excess supply of the commodity 
B) the quantity demanded of imports exceeds the quantity supplied of exports 
C) the commodity price will fall 
D) all of the above

Question 14

If the terms of trade increase in a two-nation world,those of the trade partner:

Accepted Answer

A) deteriorate 
B) improve 
C) remain unchanged 
D) any of the above 
A) deteriorate 
B) improve 
C) remain unchanged 
D) any of the above

Question 15

Which of the following statements regarding partial equilibrium analysis is true?

Accepted Answer

A) The demand and supply curve are derived from the nation's production frontier and indifference map 
B) It shows the same basic information as offer curves 
C) It shows the same equilibrium relative commodity prices as with offer curves 
D) all of the above 
A) The demand and supply curve are derived from the nation's production frontier and indifference map 
B) It shows the same basic information as offer curves 
C) It shows the same equilibrium relative commodity prices as with offer curves 
D) all of the above

Which of the following statements regarding partial equilibrium analysis is false?

If the nation's tastes for its import commodity increases:

In what way does partial equilibrium analysis differ from general equilibrium analysis?

If a nation does not affect world prices by its trading,its offer curve:

Export prices must rise for a nation to increase its exports because the nation:

If the tastes for a nation import commodity increases,trade volume:

If the nation's tastes for its import commodity increases:

If the terms of trade of a nation are 1.5 in a two-nation world,those of the trade partner are:

The offer curve of a nation bulges toward the axis measuring the nations

A deterioration of a nation's terms of trade causes the nation's welfare to:

Which of the following statements is correct?

The offer curve of a nation shows:

At a relative commodity price above equilibrium

If the terms of trade increase in a two-nation world,those of the trade partner:

Which of the following statements regarding partial equilibrium analysis is true?

Introduction

The Law of Comparative Advantage

The Standard Theory of International Trade

Factor Endowments and the Heckscherohlin Theory

Economies of Scale, Imperfect Competition, and International Trade

Economic Growth and International Trade

Trade Restrictions: Tariffs

Nontariff Trade Barriers and the New Protectionism

Economic Integration: Customs Unions and Free Trade Areas

International Trade and Economic Development

International Resource Movements and Multinational Corporations

Balance of Payments

Foreign Exchange Markets and Exchange Rates

Exchange Rate Determination

The Price Adjustment Mechanism With Flexible and Fixed Exchange Rates

The Income Adjustment Mechanism and Synthesis of Automatic Adjustments

Open-Economy Macroeconomics: Adjustment Policies

Prices and Output in an Open Economy: Aggregate Demand and Aggregate Supply

Flexible Versus Fixed Exchange Rates, the European Monetary System, and Macroeconomic Policy Coordination

The International Monetary System: Past, Present, and Future

Filters

Exam 4: Demand and Supply, Offer Curves, and the Terms of Trade

Which of the following statements regarding partial equilibrium analysis is false?

If the nation's tastes for its import commodity increases:

In what way does partial equilibrium analysis differ from general equilibrium analysis?

If a nation does not affect world prices by its trading,its offer curve:

Export prices must rise for a nation to increase its exports because the nation:

If the tastes for a nation import commodity increases,trade volume:

If the nation's tastes for its import commodity increases:

If the terms of trade of a nation are 1.5 in a two-nation world,those of the trade partner are:

The offer curve of a nation bulges toward the axis measuring the nations

A deterioration of a nation's terms of trade causes the nation's welfare to:

Which of the following statements is correct?

The offer curve of a nation shows:

At a relative commodity price above equilibrium

If the terms of trade increase in a two-nation world,those of the trade partner:

Which of the following statements regarding partial equilibrium analysis is true?

Introduction

The Law of Comparative Advantage

The Standard Theory of International Trade

Factor Endowments and the Heckscherohlin Theory

Economies of Scale, Imperfect Competition, and International Trade

Economic Growth and International Trade

Trade Restrictions: Tariffs

Nontariff Trade Barriers and the New Protectionism

Economic Integration: Customs Unions and Free Trade Areas

International Trade and Economic Development

International Resource Movements and Multinational Corporations

Balance of Payments

Foreign Exchange Markets and Exchange Rates

Exchange Rate Determination

The Price Adjustment Mechanism With Flexible and Fixed Exchange Rates

The Income Adjustment Mechanism and Synthesis of Automatic Adjustments

Open-Economy Macroeconomics: Adjustment Policies

Prices and Output in an Open Economy: Aggregate Demand and Aggregate Supply

Flexible Versus Fixed Exchange Rates, the European Monetary System, and Macroeconomic Policy Coordination

The International Monetary System: Past, Present, and Future

Filters