Question 1

Since the mid- 1960s, tariffs in the United States

Accepted Answer

A)  rose sharply until 1980, then fell. 
B)  have been about the same. 
C)  have been falling. 
D)  have been rising. 
A)  rose sharply until 1980, then fell. 
B)  have been about the same. 
C)  have been falling. 
D)  have been rising.

Question 2

The proposition that protection is necessary to allow an infant industry to grow into a mature industry so that it can compete in world markets is the .

Accepted Answer

A)  growth proposition 
B)  infant- maturity argument 
C)  new industry proposition 
D)  infant- industry argument 
A)  growth proposition 
B)  infant- maturity argument 
C)  new industry proposition 
D)  infant- industry argument

Question 3

Some people assert that protection from foreign competition prevents rich countries from exploiting developing countries. What is this argument in more detail and what is its flaw?

Accepted Answer

The argument claims that rich nations wi

Question 4

When a rich nation buys a product made in a poor nation, in the poor nation the demand for labor
And the wage rate .

Accepted Answer

A)  increases; falls 
B)  decreases; rises 
C)  increases; rises 
D)  decreases; falls 
A)  increases; falls 
B)  decreases; rises 
C)  increases; rises 
D)  decreases; falls

Question 5

Because wage rates are so low in Africa, why don't Microsoft, Cisco and other major corporations close down their American operations and move to Africa?

Accepted Answer

Wage rates must be weighed against produ

Question 6

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

Accepted Answer

A)  raise; not change 
B)  lower; not change 
C)  raise; decrease 
D)  raise; increase 
A)  raise; not change 
B)  lower; not change 
C)  raise; decrease 
D)  raise; increase

Question 7

Voluntary export restraints (VERs)

Accepted Answer

A)  raise revenue for the governments involved. 
B)  raise the prices paid by domestic consumers. 
C)  do not protect domestic producers. 
D)  Both answers B and C are correct. 
A)  raise revenue for the governments involved. 
B)  raise the prices paid by domestic consumers. 
C)  do not protect domestic producers. 
D)  Both answers B and C are correct.

Question 8

During 2006, as oil and gas prices continued to increase, a growing number of Americans called for the United States to become less reliant on Middle- Eastern oil. Would it make sense for the United States to try to become totally self- reliant in the production of oil? Why or why not?

Accepted Answer

It would be foolish for the United State

Question 9

A difference between a quota and a tariff is that

Accepted Answer

A)  the government collects revenues from a tariff but does not collect revenues from a quota. 
B)  a tariff generates a higher price than does a quota. 
C)  a tariff generates a greater reduction in exports than does a quota. 
D)  a quota increases profits of domestic producers more than does a tariff. 
A)  the government collects revenues from a tariff but does not collect revenues from a quota. 
B)  a tariff generates a higher price than does a quota. 
C)  a tariff generates a greater reduction in exports than does a quota. 
D)  a quota increases profits of domestic producers more than does a tariff.

Question 10

A tariff is

Accepted Answer

A)  a government imposed limit on the amount of a good that can be exported from a nation. 
B)  an agreement between governments to limit exports from a nation. 
C)  a tax on a good imported into a nation. 
D)  a government imposed barrier that sets a fixed limit on the amount of a good that can be imported into a nation. 
A)  a government imposed limit on the amount of a good that can be exported from a nation. 
B)  an agreement between governments to limit exports from a nation. 
C)  a tax on a good imported into a nation. 
D)  a government imposed barrier that sets a fixed limit on the amount of a good that can be imported into a nation.

Question 11

Two arguments used to promote trade barriers are the infant- industry argument, and the dumping argument. Explain each of these arguments and evaluate whether each one has any flaws.

Accepted Answer

The infant- industry argument is that it

Question 12

Lowering the tariff on good X will

Accepted Answer

A)  have no effect unless the nation's trading partner also lowers its tariff on good X. 
B)  increase the domestic price of good X. 
C)  increase the domestic imports of good X. 
D)  increase domestic employment in industry X. 
A)  have no effect unless the nation's trading partner also lowers its tariff on good X. 
B)  increase the domestic price of good X. 
C)  increase the domestic imports of good X. 
D)  increase domestic employment in industry X.

Question 13

If the United States imposes a tariff on imported steel, the tariff will

Accepted Answer

A)  decrease employment in the U.S. steel industry. 
B)  decrease the U.S. production of steel. 
C)  increase the total U.S. consumption of steel. 
D)  raise the U.S. price of imported steel. 
A)  decrease employment in the U.S. steel industry. 
B)  decrease the U.S. production of steel. 
C)  increase the total U.S. consumption of steel. 
D)  raise the U.S. price of imported steel.

Question 14

Define comparative advantage and discuss its role in international trade.

Accepted Answer

Comparative advantage is the factor that

Question 15

What is dumping?

Accepted Answer

Dumping is the situation in wh

Question 16

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

Accepted Answer

A)  a tariff. 
B)  a quota. 
C)  an excise tax. 
D)  a surcharge. 
A)  a tariff. 
B)  a quota. 
C)  an excise tax. 
D)  a surcharge.

Question 17

During 2005- 2006 Europe imported more than $70 million worth of US long- grain rice. In 2006, the European Union threatened to restrict imports of long- grain rice because traces of genetically modified rice were found mixed in to commercial supplies. What would NOT be an effect in the European rice market if U.S. imports were banned?

Accepted Answer

A)  There would be an increase European in rice production 
B)  The price of long- grain rice would increase 
C)  There would be a increase in long- grain rice consumption 
D)  The quantity of long- grain rice imports would decrease 
A)  There would be an increase European in rice production 
B)  The price of long- grain rice would increase 
C)  There would be a increase in long- grain rice consumption 
D)  The quantity of long- grain rice imports would decrease

Question 18

Increasing a tariff will the domestic quantity consumed of the good, while the domestic production of the good.

Accepted Answer

A)  increase; increasing 
B)  decrease; decreasing 
C)  increase; decreasing 
D)  decrease; increasing 
A)  increase; increasing 
B)  decrease; decreasing 
C)  increase; decreasing 
D)  decrease; increasing

Question 19

Japan was accused of dumping in the steel industry within the United States when it

Accepted Answer

A)  negotiated an illegal agreement to raise prices with U.S. steel industries. 
B)  negotiated a illegal trade deal with Canada. 
C)  prohibited imports of U.S. steel into Japan. 
D)  sold steel in the United States at a price below its cost of production. 
A)  negotiated an illegal agreement to raise prices with U.S. steel industries. 
B)  negotiated a illegal trade deal with Canada. 
C)  prohibited imports of U.S. steel into Japan. 
D)  sold steel in the United States at a price below its cost of production.

Question 20

When considering rent seeking, which of the following is TRUE?

Accepted Answer

A)  Only the pro- free trade group is concerned about the government's revenue from tariffs. 
B)  Usually only the anti- free trade group is concerned about what is best for society at large. 
C)  The pro- free trade group generally will lobby more than the anti- free trade group. 
D)  The anti- free trade group generally will lobby more than the pro- free trade group. 
A)  Only the pro- free trade group is concerned about the government's revenue from tariffs. 
B)  Usually only the anti- free trade group is concerned about what is best for society at large. 
C)  The pro- free trade group generally will lobby more than the anti- free trade group. 
D)  The anti- free trade group generally will lobby more than the pro- free trade group.

Since the mid- 1960s, tariffs in the United States

The proposition that protection is necessary to allow an infant industry to grow into a mature industry so that it can compete in world markets is the .

Some people assert that protection from foreign competition prevents rich countries from exploiting developing countries. What is this argument in more detail and what is its flaw?

When a rich nation buys a product made in a poor nation, in the poor nation the demand for labor And the wage rate .

Because wage rates are so low in Africa, why don't Microsoft, Cisco and other major corporations close down their American operations and move to Africa?

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

Voluntary export restraints (VERs)

During 2006, as oil and gas prices continued to increase, a growing number of Americans called for the United States to become less reliant on Middle- Eastern oil. Would it make sense for the United States to try to become totally self- reliant in the production of oil? Why or why not?

A difference between a quota and a tariff is that

A tariff is

Two arguments used to promote trade barriers are the infant- industry argument, and the dumping argument. Explain each of these arguments and evaluate whether each one has any flaws.

Lowering the tariff on good X will

If the United States imposes a tariff on imported steel, the tariff will

Define comparative advantage and discuss its role in international trade.

What is dumping?

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

Increasing a tariff will the domestic quantity consumed of the good, while the domestic production of the good.

Japan was accused of dumping in the steel industry within the United States when it

When considering rent seeking, which of the following is TRUE?

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

Since the mid- 1960s, tariffs in the United States

The proposition that protection is necessary to allow an infant industry to grow into a mature industry so that it can compete in world markets is the .

Some people assert that protection from foreign competition prevents rich countries from exploiting developing countries. What is this argument in more detail and what is its flaw?

When a rich nation buys a product made in a poor nation, in the poor nation the demand for labor And the wage rate .

Because wage rates are so low in Africa, why don't Microsoft, Cisco and other major corporations close down their American operations and move to Africa?

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

Voluntary export restraints (VERs)

During 2006, as oil and gas prices continued to increase, a growing number of Americans called for the United States to become less reliant on Middle- Eastern oil. Would it make sense for the United States to try to become totally self- reliant in the production of oil? Why or why not?

A difference between a quota and a tariff is that

A tariff is

Two arguments used to promote trade barriers are the infant- industry argument, and the dumping argument. Explain each of these arguments and evaluate whether each one has any flaws.

Lowering the tariff on good X will

If the United States imposes a tariff on imported steel, the tariff will

Define comparative advantage and discuss its role in international trade.

What is dumping?

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

Increasing a tariff will the domestic quantity consumed of the good, while the domestic production of the good.

Japan was accused of dumping in the steel industry within the United States when it

When considering rent seeking, which of the following is TRUE?

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