Question 1

Free trade will affect a country's employment in different industries.

Accepted Answer

A) True 
 B)False  True

Question 2

According to the data presented in the text, the effect of Japan's voluntary export restraints on cars was to:

Accepted Answer

A)  decrease the price of Japanese cars in the U.S. 
B)  increase the number of Japanese cars imported in the U.S. 
C)  caused Japanese car companies to delay building plants in the U.S. 
D)  increase the price of Japanese cars in the U.S. 
A)  decrease the price of Japanese cars in the U.S. 
B)  increase the number of Japanese cars imported in the U.S. 
C)  caused Japanese car companies to delay building plants in the U.S. 
D)  increase the price of Japanese cars in the U.S. D

Question 3

-Refer to Table 18.1. If Poland produces 50 bagpipes, how many accordions can they produce for the rest of the day?

Accepted Answer

A)  75 
B)  50 
C)  125 
D)  25 
A)  75 
B)  50 
C)  125 
D)  25 B

Question 4

Which of the following trade policies will prevent a foreign supplier to sell even one unit of the good in the domestic market?

Accepted Answer

A)  import quota 
B)  voluntary export restraint 
C)  import tariffs 
D)  import ban 
A)  import quota 
B)  voluntary export restraint 
C)  import tariffs 
D)  import ban

Question 5

The difficulty with enforcing anti- dumping laws is that predatory pricing is difficult to determine if the lower price is due to:

Accepted Answer

A)  firm generosity. 
B)  higher costs. 
C)  economies of scale. 
D)  price discrimination. 
A)  firm generosity. 
B)  higher costs. 
C)  economies of scale. 
D)  price discrimination.

Question 6

The opportunity cost of a table is 5 chairs in nation A and 1 chair in nation B. If the nations specialize and trade, an acceptable terms of trade for both nations would be 3 chairs per table.

Accepted Answer

A) True 
 B)False

Question 7

Dumping occurs when a firm:

Accepted Answer

A)  generates toxic waste when producing export goods and then dumps the waste in the ocean. 
B)  stops selling to a foreign market due to excessive tariffs. 
C)  charges a lower price to a foreign market than either its home market or the production costs. 
D)  charges a higher price to a foreign market than either its home market or the production costs. 
A)  generates toxic waste when producing export goods and then dumps the waste in the ocean. 
B)  stops selling to a foreign market due to excessive tariffs. 
C)  charges a lower price to a foreign market than either its home market or the production costs. 
D)  charges a higher price to a foreign market than either its home market or the production costs.

Question 8

Recall Application 3, "Are They Really Dumping?" to answer the following questions:
-According to the application, how does the Department of Commerce determine the price of the good in the foreign market?

Accepted Answer

A)  They use a "constructed value" method where it makes its own estimates of what prices in countries' own markets would be based on available data. 
B)  They rely on the information supplied by the firms that bring about the charges. 
C)  They use dated and very crude estimates. 
D)  All of the above are correct. 
A)  They use a "constructed value" method where it makes its own estimates of what prices in countries' own markets would be based on available data. 
B)  They rely on the information supplied by the firms that bring about the charges. 
C)  They use dated and very crude estimates. 
D)  All of the above are correct.

Question 9

What is the rationale for protecting infant industries?

Accepted Answer

The rationale for protecting infant indu

Question 10

The argument that calls for the trade protection of only newly developing industries is known as the _______ argument.

Accepted Answer

A)  developing nation 
B)  learning by doing 
C)  predatory dumping 
D)  infant industry 
A)  developing nation 
B)  learning by doing 
C)  predatory dumping 
D)  infant industry

Question 11

What is the GATT?

Accepted Answer

The General Agreement on Tarif

Question 12

The Asian Pacific Economic Cooperation (APEC) was modeled after NAFTA.

Accepted Answer

A) True 
 B)False

Question 13

-Refer to Table 18.2. Japan has a comparative advantage in the production of

Accepted Answer

A)  tractors. 
B)  stereos. 
C)  both stereos and tractors. 
D)  neither stereos nor tractors. 
A)  tractors. 
B)  stereos. 
C)  both stereos and tractors. 
D)  neither stereos nor tractors.

Question 14

Suppose the United States produces only two goods, textiles and computer chips. If the United States has a comparative advantage in computer chips, a move toward free trade will:

Accepted Answer

A)  benefit computer chip workers, harm textile workers, but benefit the nation as a whole. 
B)  harm computer chip workers, benefit textile workers, but benefit the nation as a whole. 
C)  benefit computer chip workers, harm textile workers, but harm the nation as a whole. 
D)  harm computer chip workers, harm textile workers, but benefit the nation as a whole. 
A)  benefit computer chip workers, harm textile workers, but benefit the nation as a whole. 
B)  harm computer chip workers, benefit textile workers, but benefit the nation as a whole. 
C)  benefit computer chip workers, harm textile workers, but harm the nation as a whole. 
D)  harm computer chip workers, harm textile workers, but benefit the nation as a whole.

Question 15

If the U.S .government imposes an import ban on German made cars, then:

Accepted Answer

A)  any German made car after a certain predetermined number is not allowed. 
B)  no German made can can enter the US without being taxed. 
C)  no German made cars can enter the US. 
D)  any German made car after a certain predetermined number is taxed. 
A)  any German made car after a certain predetermined number is not allowed. 
B)  no German made can can enter the US without being taxed. 
C)  no German made cars can enter the US. 
D)  any German made car after a certain predetermined number is taxed.

Question 16

Suppose nation A produces only two goods, apples and oranges . If nation A produces only apples, it can make 20 apples per day. If nation A produces only oranges, it can make 15 oranges per day. If the country has a constant production trade- off between apples and oranges, then the opportunity cost of one apple in nation A is:

Accepted Answer

A)  1.33 oranges. 
B)  20 oranges. 
C)  15 oranges. 
D)  .75 oranges. 
A)  1.33 oranges. 
B)  20 oranges. 
C)  15 oranges. 
D)  .75 oranges.

Question 17

Figure 18.2
-Refer to Figure 18.2. Pizzaland has a comparative advantage in the production of:

Accepted Answer

A)  cheese. 
B)  tomatoes. 
C)  both cheese and tomatoes. 
D)  neither cheese nor tomatoes. 
A)  cheese. 
B)  tomatoes. 
C)  both cheese and tomatoes. 
D)  neither cheese nor tomatoes.

Question 18

In the last few decades there has been considerable progress in lowering the barriers to international trade.

Accepted Answer

A) True 
 B)False

Question 19

Figure 18.2
-Refer to Figure 18.2. After trade and specialization begin, the maximum amount of cheese that Pizzaland can consume is:

Accepted Answer

A)  150. 
B)  60. 
C)  120. 
D)  90. 
A)  150. 
B)  60. 
C)  120. 
D)  90.

Question 20

Among the rationales for protection is that it helps the domestic economy grow.

Accepted Answer

A) True 
 B)False

Free trade will affect a country's employment in different industries.

According to the data presented in the text, the effect of Japan's voluntary export restraints on cars was to:

-Refer to Table 18.1. If Poland produces 50 bagpipes, how many accordions can they produce for the rest of the day?

Which of the following trade policies will prevent a foreign supplier to sell even one unit of the good in the domestic market?

The difficulty with enforcing anti- dumping laws is that predatory pricing is difficult to determine if the lower price is due to:

The opportunity cost of a table is 5 chairs in nation A and 1 chair in nation B. If the nations specialize and trade, an acceptable terms of trade for both nations would be 3 chairs per table.

Dumping occurs when a firm:

Recall Application 3, "Are They Really Dumping?" to answer the following questions: -According to the application, how does the Department of Commerce determine the price of the good in the foreign market?

What is the rationale for protecting infant industries?

The argument that calls for the trade protection of only newly developing industries is known as the _______ argument.

What is the GATT?

The Asian Pacific Economic Cooperation (APEC) was modeled after NAFTA.

-Refer to Table 18.2. Japan has a comparative advantage in the production of

Suppose the United States produces only two goods, textiles and computer chips. If the United States has a comparative advantage in computer chips, a move toward free trade will:

If the U.S .government imposes an import ban on German made cars, then:

Figure 18.2 -Refer to Figure 18.2. Pizzaland has a comparative advantage in the production of:

In the last few decades there has been considerable progress in lowering the barriers to international trade.

Figure 18.2 -Refer to Figure 18.2. After trade and specialization begin, the maximum amount of cheese that Pizzaland can consume is:

Among the rationales for protection is that it helps the domestic economy grow.

Introduction: What Is Economics

The Key Principles of Economics

Exchange and Markets

Demand, Supply, and Market Equilibrium

Measuring a Nations Production and Income

Unemployment and Inflation

The Economy at Full Employment

Why Do Economies Grow

Aggregate Demand and Aggregate Supply

Fiscal Policy

The Income-Expenditure Model

Investment and Financial Markets

Money and the Banking System

The Federal Reserve and Monetary Policy

Modern Macroeconomics: From the Short Run to the Long Run

The Dynamics of Inflation and Unemployment

Macroeconomic Policy Debates

The World of International Finance

Filters

Exam 18: International Trade and Public Policy

Free trade will affect a country's employment in different industries.

According to the data presented in the text, the effect of Japan's voluntary export restraints on cars was to:

-Refer to Table 18.1. If Poland produces 50 bagpipes, how many accordions can they produce for the rest of the day?

Which of the following trade policies will prevent a foreign supplier to sell even one unit of the good in the domestic market?

The difficulty with enforcing anti- dumping laws is that predatory pricing is difficult to determine if the lower price is due to:

The opportunity cost of a table is 5 chairs in nation A and 1 chair in nation B. If the nations specialize and trade, an acceptable terms of trade for both nations would be 3 chairs per table.

Dumping occurs when a firm:

Recall Application 3, "Are They Really Dumping?" to answer the following questions: -According to the application, how does the Department of Commerce determine the price of the good in the foreign market?

What is the rationale for protecting infant industries?

The argument that calls for the trade protection of only newly developing industries is known as the _______ argument.

What is the GATT?

The Asian Pacific Economic Cooperation (APEC) was modeled after NAFTA.

-Refer to Table 18.2. Japan has a comparative advantage in the production of

Suppose the United States produces only two goods, textiles and computer chips. If the United States has a comparative advantage in computer chips, a move toward free trade will:

If the U.S .government imposes an import ban on German made cars, then:

Figure 18.2 -Refer to Figure 18.2. Pizzaland has a comparative advantage in the production of:

In the last few decades there has been considerable progress in lowering the barriers to international trade.

Figure 18.2 -Refer to Figure 18.2. After trade and specialization begin, the maximum amount of cheese that Pizzaland can consume is:

Among the rationales for protection is that it helps the domestic economy grow.

Introduction: What Is Economics

The Key Principles of Economics

Exchange and Markets

Demand, Supply, and Market Equilibrium

Measuring a Nations Production and Income

Unemployment and Inflation

The Economy at Full Employment

Why Do Economies Grow

Aggregate Demand and Aggregate Supply

Fiscal Policy

The Income-Expenditure Model

Investment and Financial Markets

Money and the Banking System

The Federal Reserve and Monetary Policy

Modern Macroeconomics: From the Short Run to the Long Run

The Dynamics of Inflation and Unemployment

Macroeconomic Policy Debates

The World of International Finance

Filters