Question 1

The most efficient way to encourage the growth of an infant- industry is through a

Accepted Answer

A)  voluntary export restraint. 
B)  an import quota. 
C)  subsidy. 
D)  tariff. 
A)  voluntary export restraint. 
B)  an import quota. 
C)  subsidy. 
D)  tariff. C

Question 2

A tax that is imposed by the importing country when an imported good crosses its international boundary is called

Accepted Answer

A)  dumping. 
B)  an import quota. 
C)  a voluntary export restraint. 
D)  a tariff. 
A)  dumping. 
B)  an import quota. 
C)  a voluntary export restraint. 
D)  a tariff. D

Question 3

The figure shows the market for shirts in the United States, where D is the domestic demand curve and S is the domestic supp The world price is $20 per shirt. The United States imposes a tariff on imported shirts, $4 per shirt.
-In the figure above, with the tariff the United States imports million shirts per year.

Accepted Answer

A)  8 
B)  32 
C)  24 
D)  16 
A)  8 
B)  32 
C)  24 
D)  16 D

Question 4

An import quota directly restricts _ and are designed to protect domestic .

Accepted Answer

A)  imports; producers 
B)  imports; consumers 
C)  exports; consumers 
D)  exports; producers 
A)  imports; producers 
B)  imports; consumers 
C)  exports; consumers 
D)  exports; producers

Question 5

If a government imposes a quota on imports of a popular doll, the price of the doll in the country will and the quantity purchased in the country will .

Accepted Answer

A)  rise; increase 
B)  fall; decrease 
C)  rise; decrease 
D)  fall; increase 
A)  rise; increase 
B)  fall; decrease 
C)  rise; decrease 
D)  fall; increase

Question 6

Which of the following are TRUE regarding the argument that trade barriers protect U.S. workers fr cheap foreign labor?
I. Low- wage foreigners are just as productive as U.S. workers.
II. U.S. workers have a comparative advantage in low- wage jobs.

Accepted Answer

A)  II only 
B)  I only 
C)  I and II 
D)  Neither I nor II is correct. 
A)  II only 
B)  I only 
C)  I and II 
D)  Neither I nor II is correct.

Question 7

The reason tariffs and quotas are imposed is that

Accepted Answer

A)  their costs are spread among many people and their benefits are concentrated. 
B)  they create net benefits in the long run. 
C)  they reduce import dependence. 
D)  their costs are concentrated and their benefits are spread among many people. 
A)  their costs are spread among many people and their benefits are concentrated. 
B)  they create net benefits in the long run. 
C)  they reduce import dependence. 
D)  their costs are concentrated and their benefits are spread among many people.

Question 8

Tariffs

Accepted Answer

A)  generate revenue for the government. 
B)  generate revenue for consumers. 
C)  encourage domestic producers to produce less. 
D)  encourage domestic consumers to buy more imports. 
A)  generate revenue for the government. 
B)  generate revenue for consumers. 
C)  encourage domestic producers to produce less. 
D)  encourage domestic consumers to buy more imports.

Question 9

The figure shows the market for shirts in the United States, where D is the domestic demand curve and S is the domestic supp The world price is $20 per shirt.
-In the figure above, with international trade the United States million shirts per year.

Accepted Answer

A)  imports 48 
B)  exports 32 
C)  exports 16 
D)  imports 32 
A)  imports 48 
B)  exports 32 
C)  exports 16 
D)  imports 32

Question 10

Rent seeking is one reason why countries choose to

Accepted Answer

A)  follow the theory of comparative advantage. 
B)  restrict trade. 
C)  work for freer trade. 
D)  export and import the same goods. 
A)  follow the theory of comparative advantage. 
B)  restrict trade. 
C)  work for freer trade. 
D)  export and import the same goods.

Question 11

The fundamental force that drives international trade is

Accepted Answer

A)  importation duties and tariffs. 
B)  comparative advantage. 
C)  export licenses. 
D)  absolute advantage. 
A)  importation duties and tariffs. 
B)  comparative advantage. 
C)  export licenses. 
D)  absolute advantage.

Question 12

It is possible for the United States to compete against cheap foreign labor because expensive domestic workers

Accepted Answer

A)  belong to unions. 
B)  receive subsidies. 
C)  pay U.S. taxes. 
D)  are more productive. 
A)  belong to unions. 
B)  receive subsidies. 
C)  pay U.S. taxes. 
D)  are more productive.

Question 13

In 2006, European Union tariff on imported bananas from Latin America was €176 a ton. Suppose
2)5 million tons of bananas were imported in 2006 but then the tariff decreased to €152 a ton in 2007 and as a result, 3 million tons were imported in 2007. What is the change in tariff revenue between 2006 and 2007?

Accepted Answer

A)  - €1,000,000 
B)  €1,000,000 
C)  €440,000,000 
D)  €445,000,000 
A)  - €1,000,000 
B)  €1,000,000 
C)  €440,000,000 
D)  €445,000,000

Question 14

Which of the following statements about U.S. tariffs is true?

Accepted Answer

A)  U.S. tariffs have generally decreased since World War II. 
B)  U.S. tariff rates now are lower than at most other times in the past 70 years. 
C)  U.S. tariffs reached a peak of about 20 percent in 1933 as a result of passage of the Smoot- Hawley Act. 
D)  All of the above answers are correct. 
A)  U.S. tariffs have generally decreased since World War II. 
B)  U.S. tariff rates now are lower than at most other times in the past 70 years. 
C)  U.S. tariffs reached a peak of about 20 percent in 1933 as a result of passage of the Smoot- Hawley Act. 
D)  All of the above answers are correct.

Question 15

Economists usually agree with which of the following arguments that favor protectionism?

Accepted Answer

A)  the competition with cheap foreign labor defense 
B)  the dumping defense 
C)  the job protection defense 
D)  None of the above. Economists generally agree that arguments in favor of protection are flawed. 
A)  the competition with cheap foreign labor defense 
B)  the dumping defense 
C)  the job protection defense 
D)  None of the above. Economists generally agree that arguments in favor of protection are flawed.

Question 16

The United States has a comparative advantage in producing cotton if the U.S. price of cotton before international trade is _ the world price

Accepted Answer

A)  less than 
B)  greater than 
C)  equal to 
D)  not comparable to 
A)  less than 
B)  greater than 
C)  equal to 
D)  not comparable to

Question 17

Agriculture Secretary Ed Schafer today announced that Chile's Livestock and Agricultural Service approved the U.S. inspection, control and certification systems for poultry, allowing these products to enter the Chilean market effective immediately. What is NOT an effect of this change in Chilean policy on the Chilean poultry market?

Accepted Answer

A)  The quantity of Chilean imports will increase. 
B)  The quantity of poultry consumed in Chile will increase. 
C)  The price for poultry in Chile will decrease. 
D)  Chile's tariff revenue will increase. 
A)  The quantity of Chilean imports will increase. 
B)  The quantity of poultry consumed in Chile will increase. 
C)  The price for poultry in Chile will decrease. 
D)  Chile's tariff revenue will increase.

Question 18

Give a brief description of the history of tariffs in the U.S.

Accepted Answer

Today, U.S. tariffs are low compared to

Question 19

The U.S.-Colombia Trade Promotion Agreement was signed on November 22, 2006, in Washington, D.C. This comprehensive trade agreement eliminated tariffs and other barriers to goods and services. Currently, no U.S. agricultural exports enjoy tariff- free access to the Colombian market. If the United States has a comparative advantage in agricultural, which of the following is true?

Accepted Answer

A)  Columbian agricultural consumers were better off before free trade. 
B)  Columbian agricultural producers were better off before free trade. 
C)  Columbia must have comparative disadvantage in all production. 
D)  Columbia was better off before the international trade. 
A)  Columbian agricultural consumers were better off before free trade. 
B)  Columbian agricultural producers were better off before free trade. 
C)  Columbia must have comparative disadvantage in all production. 
D)  Columbia was better off before the international trade.

Question 20

Which of the following is an effective counter argument to the claim that protectionism saves domestic jobs?

Accepted Answer

A)  Protectionism eliminates domestic jobs in export industries. 
B)  The cost of saving domestic jobs through protectionism may be high. 
C)  Imports create jobs in this country for people selling and servicing imported items. 
D)  all of the above 
A)  Protectionism eliminates domestic jobs in export industries. 
B)  The cost of saving domestic jobs through protectionism may be high. 
C)  Imports create jobs in this country for people selling and servicing imported items. 
D)  all of the above

The most efficient way to encourage the growth of an infant- industry is through a

A tax that is imposed by the importing country when an imported good crosses its international boundary is called

An import quota directly restricts _ and are designed to protect domestic .

If a government imposes a quota on imports of a popular doll, the price of the doll in the country will and the quantity purchased in the country will .

Which of the following are TRUE regarding the argument that trade barriers protect U.S. workers fr cheap foreign labor? I. Low- wage foreigners are just as productive as U.S. workers. II. U.S. workers have a comparative advantage in low- wage jobs.

The reason tariffs and quotas are imposed is that

Tariffs

The figure shows the market for shirts in the United States, where D is the domestic demand curve and S is the domestic supp The world price is $20 per shirt. -In the figure above, with international trade the United States million shirts per year.

Rent seeking is one reason why countries choose to

The fundamental force that drives international trade is

It is possible for the United States to compete against cheap foreign labor because expensive domestic workers

Which of the following statements about U.S. tariffs is true?

Economists usually agree with which of the following arguments that favor protectionism?

The United States has a comparative advantage in producing cotton if the U.S. price of cotton before international trade is _ the world price

Give a brief description of the history of tariffs in the U.S.

Which of the following is an effective counter argument to the claim that protectionism saves domestic jobs?

What Is Economics

The Economic Problem

Demand and Supply

Measuring Gdp and Economic Growth

Monitoring Jobs and Inflation

Economic Growth

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers: They Keynesian Model

U.S. Inflation, Unemployment, and Business Cycle

Fiscal Policy

Monetary Policy

Filters

Exam 15: International Trade Policy

The most efficient way to encourage the growth of an infant- industry is through a

A tax that is imposed by the importing country when an imported good crosses its international boundary is called

An import quota directly restricts _ and are designed to protect domestic .

If a government imposes a quota on imports of a popular doll, the price of the doll in the country will and the quantity purchased in the country will .

Which of the following are TRUE regarding the argument that trade barriers protect U.S. workers fr cheap foreign labor? I. Low- wage foreigners are just as productive as U.S. workers. II. U.S. workers have a comparative advantage in low- wage jobs.

The reason tariffs and quotas are imposed is that

Tariffs

The figure shows the market for shirts in the United States, where D is the domestic demand curve and S is the domestic supp The world price is $20 per shirt. -In the figure above, with international trade the United States million shirts per year.

Rent seeking is one reason why countries choose to

The fundamental force that drives international trade is

It is possible for the United States to compete against cheap foreign labor because expensive domestic workers

Which of the following statements about U.S. tariffs is true?

Economists usually agree with which of the following arguments that favor protectionism?

The United States has a comparative advantage in producing cotton if the U.S. price of cotton before international trade is _ the world price

Give a brief description of the history of tariffs in the U.S.

Which of the following is an effective counter argument to the claim that protectionism saves domestic jobs?

What Is Economics

The Economic Problem

Demand and Supply

Measuring Gdp and Economic Growth

Monitoring Jobs and Inflation

Economic Growth

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers: They Keynesian Model

U.S. Inflation, Unemployment, and Business Cycle

Fiscal Policy

Monetary Policy

Filters