Question 1

Import restrictions create an incentive to smuggle.

Accepted Answer

A) True 
 B)False

Question 2

-Refer to Table 18.1. Poland has a comparative advantage in:

Accepted Answer

A)  accordions. 
B)  bagpipes. 
C)  both accordions and bagpipes. 
D)  neither accordions nor bagpipes. 
A)  accordions. 
B)  bagpipes. 
C)  both accordions and bagpipes. 
D)  neither accordions nor bagpipes.

Question 3

Figure 18.5
-For the good in Figure 18.5 ,with the tariff, the people in the country will produce:

Accepted Answer

A)  Q1. 
B)  Q5. 
C)  Q2. 
D)  Q4. 
A)  Q1. 
B)  Q5. 
C)  Q2. 
D)  Q4.

Question 4

-Refer to Table 18.2. After trade begins, _______ will specialize in the production of stereos and _______ will specialize in the production of tractors.

Accepted Answer

A)  U.S.; Japan 
B)  Japan; U.S. 
C)  U.S.; U.S. 
D)  Japan; Japan 
A)  U.S.; Japan 
B)  Japan; U.S. 
C)  U.S.; U.S. 
D)  Japan; Japan

Question 5

The terms of trade refers to the:

Accepted Answer

A)  opportunity cost of producing each good in each country. 
B)  relative amounts of the goods that will be exchanged for each other in trade. 
C)  slope of the production possibilities curve. 
D)  all of the above 
A)  opportunity cost of producing each good in each country. 
B)  relative amounts of the goods that will be exchanged for each other in trade. 
C)  slope of the production possibilities curve. 
D)  all of the above

Question 6

Dumping is sometimes legal under international trade agreements.

Accepted Answer

A) True 
 B)False

Question 7

Recall Application 3, "Are They Really Dumping?" to answer the following questions:
-According to the application, how many cases of dumping in 1995- 1998 used the actual price in the foreign market to make a determination if a dumping occurred?

Accepted Answer

A)  4 out of 141 
B)  137 out of 141 
C)  all 141 out of 141 
D)  none of the 141 
A)  4 out of 141 
B)  137 out of 141 
C)  all 141 out of 141 
D)  none of the 141

Question 8

Which of the following statements is true?

Accepted Answer

A)  Free trade will benefit all workers in a nation equally. 
B)  Free trade leads to lower wages for all workers in both nations. 
C)  As a result of specialization some workers will be displaced and hence, harmed by free trade. 
D)  Specialization will result in a decline in an industry and none of those workers will be able to find other jobs. 
A)  Free trade will benefit all workers in a nation equally. 
B)  Free trade leads to lower wages for all workers in both nations. 
C)  As a result of specialization some workers will be displaced and hence, harmed by free trade. 
D)  Specialization will result in a decline in an industry and none of those workers will be able to find other jobs.

Question 9

If a firm charges a foreign market a lower price than it charges the domestic market that firm is said to be _______ its product.

Accepted Answer

A)  stumping 
B)  disposing of 
C)  transferring 
D)  dumping 
A)  stumping 
B)  disposing of 
C)  transferring 
D)  dumping

Question 10

-Refer to Table 18.1. Possible terms of trade between Scotland and Poland are:

Accepted Answer

A)  1 accordion for 1/4 bagpipe. 
B)  1 bagpipe for 1/3 accordion. 
C)  1 bagpipe for 2 accordions. 
D)  1 accordion for 1 bagpipe. 
A)  1 accordion for 1/4 bagpipe. 
B)  1 bagpipe for 1/3 accordion. 
C)  1 bagpipe for 2 accordions. 
D)  1 accordion for 1 bagpipe.

Question 11

Which of the following statements is false?

Accepted Answer

A)  The production possibilities curve shows the combinations of goods that can be produced by a nation before trading begins. 
B)  The production possibilities curve shows the combinations of goods that can be consumed by a nation before trade begins. 
C)  The production possibilities curve shows the combinations of goods that can be consumed by a nation after trade and specialization begins. 
D)  The production possibilities curve shows the combinations of goods that can be produced by a nation after trade and specialization begins. 
A)  The production possibilities curve shows the combinations of goods that can be produced by a nation before trading begins. 
B)  The production possibilities curve shows the combinations of goods that can be consumed by a nation before trade begins. 
C)  The production possibilities curve shows the combinations of goods that can be consumed by a nation after trade and specialization begins. 
D)  The production possibilities curve shows the combinations of goods that can be produced by a nation after trade and specialization begins.

Question 12

-Refer to Table 18.1. If Scotland produces and consumes 5 accordions and 40 bagpipes while Poland produces and consumes 25 bagpipes and 100 accordions, then we say that Poland and Scotland are:

Accepted Answer

A)  specializing and trading. 
B)  in autarky. 
C)  in limited trade. 
D)  fully utilizing the benefits of their comparative advantage. 
A)  specializing and trading. 
B)  in autarky. 
C)  in limited trade. 
D)  fully utilizing the benefits of their comparative advantage.

Question 13

Which of the following trade agreements took effect in 1994 and, over a 15- year period, will eliminate all tariffs and other trade barriers between its members?

Accepted Answer

A)  Asian Pacific Economic Cooperation 
B)  GATT 
C)  North American Free Trade Agreement 
D)  World Trade Organization 
A)  Asian Pacific Economic Cooperation 
B)  GATT 
C)  North American Free Trade Agreement 
D)  World Trade Organization

Question 14

Using a graph, illustrate what the market effects of a quota, a tariff, or a complete ban on imports would be.

Accepted Answer

185) @#IMG-DLM& As shown in the figure, the demand

Question 15

Recall Application 4, "Trade, Consumption and Inequality," to answer the following questions:
-According to the application, what was the moral of the story concerning free trade?

Accepted Answer

A)  Trade amplifies a country's income inequality. 
B)  Trade affects both employment and prices. 
C)  Everyone benefits from free trade. 
D)  Everyone gets hurt from free trade. 
A)  Trade amplifies a country's income inequality. 
B)  Trade affects both employment and prices. 
C)  Everyone benefits from free trade. 
D)  Everyone gets hurt from free trade.

Question 16

Exporting nations often agree to voluntary export restraints in an attempt to:

Accepted Answer

A)  decrease inflation. 
B)  increase global welfare. 
C)  avoid more restrictive trade policies. 
D)  employ more workers in the importing nation. 
A)  decrease inflation. 
B)  increase global welfare. 
C)  avoid more restrictive trade policies. 
D)  employ more workers in the importing nation.

Question 17

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

Accepted Answer

A)  benefit tractor workers, harm grape workers, but harm the nation as a whole. 
B)  harm tractor workers, benefit grape workers, but benefit the nation as a whole. 
C)  benefit tractor workers, harm grape workers, but benefit the nation as a whole. 
D)  harm tractor workers, harm grape workers, but benefit the nation as a whole. 
A)  benefit tractor workers, harm grape workers, but harm the nation as a whole. 
B)  harm tractor workers, benefit grape workers, but benefit the nation as a whole. 
C)  benefit tractor workers, harm grape workers, but benefit the nation as a whole. 
D)  harm tractor workers, harm grape workers, but benefit the nation as a whole.

Question 18

If Cowland can produce milk at a lower opportunity cost than any other nation, Cowland is said to have a(n) _______ in the production of milk.

Accepted Answer

A)  autarky 
B)  comparative disadvantage 
C)  absolute advantage 
D)  comparative advantage 
A)  autarky 
B)  comparative disadvantage 
C)  absolute advantage 
D)  comparative advantage

Question 19

From the perspective of consumers, a quota is preferred to a tariff.

Accepted Answer

A) True 
 B)False

Question 20

Recall Application 3, "Are They Really Dumping?" to answer the following questions:
-Based on what you learned from the application, how will the "constructed value" method used by the Department of Commerce affect the number of cases that it will deem as dumping?

Accepted Answer

A)  The Department of Commerce will identify fewer cases of dumping into the U.S. 
B)  The Department of Commerce will identify more cases of dumping into the U.S. 
C)  The Department of Commerce will identify all cases brought in front of them as "not dumping." 
D)  The Department of Commerce will correctly identify all cases as "dumping." 
A)  The Department of Commerce will identify fewer cases of dumping into the U.S. 
B)  The Department of Commerce will identify more cases of dumping into the U.S. 
C)  The Department of Commerce will identify all cases brought in front of them as "not dumping." 
D)  The Department of Commerce will correctly identify all cases as "dumping."

Import restrictions create an incentive to smuggle.

-Refer to Table 18.1. Poland has a comparative advantage in:

Figure 18.5 -For the good in Figure 18.5 ,with the tariff, the people in the country will produce:

-Refer to Table 18.2. After trade begins, _ will specialize in the production of stereos and _ will specialize in the production of tractors.

The terms of trade refers to the:

Dumping is sometimes legal under international trade agreements.

Recall Application 3, "Are They Really Dumping?" to answer the following questions: -According to the application, how many cases of dumping in 1995- 1998 used the actual price in the foreign market to make a determination if a dumping occurred?

Which of the following statements is true?

If a firm charges a foreign market a lower price than it charges the domestic market that firm is said to be _______ its product.

-Refer to Table 18.1. Possible terms of trade between Scotland and Poland are:

Which of the following statements is false?

-Refer to Table 18.1. If Scotland produces and consumes 5 accordions and 40 bagpipes while Poland produces and consumes 25 bagpipes and 100 accordions, then we say that Poland and Scotland are:

Which of the following trade agreements took effect in 1994 and, over a 15- year period, will eliminate all tariffs and other trade barriers between its members?

Using a graph, illustrate what the market effects of a quota, a tariff, or a complete ban on imports would be.

Recall Application 4, "Trade, Consumption and Inequality," to answer the following questions: -According to the application, what was the moral of the story concerning free trade?

Exporting nations often agree to voluntary export restraints in an attempt to:

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

If Cowland can produce milk at a lower opportunity cost than any other nation, Cowland is said to have a(n) _______ in the production of milk.

From the perspective of consumers, a quota is preferred to a tariff.

Recall Application 3, "Are They Really Dumping?" to answer the following questions: -Based on what you learned from the application, how will the "constructed value" method used by the Department of Commerce affect the number of cases that it will deem as dumping?

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

Import restrictions create an incentive to smuggle.

-Refer to Table 18.1. Poland has a comparative advantage in:

Figure 18.5 -For the good in Figure 18.5 ,with the tariff, the people in the country will produce:

-Refer to Table 18.2. After trade begins, _______ will specialize in the production of stereos and _______ will specialize in the production of tractors.

The terms of trade refers to the:

Dumping is sometimes legal under international trade agreements.

Recall Application 3, "Are They Really Dumping?" to answer the following questions: -According to the application, how many cases of dumping in 1995- 1998 used the actual price in the foreign market to make a determination if a dumping occurred?

Which of the following statements is true?

If a firm charges a foreign market a lower price than it charges the domestic market that firm is said to be _______ its product.

-Refer to Table 18.1. Possible terms of trade between Scotland and Poland are:

Which of the following statements is false?

-Refer to Table 18.1. If Scotland produces and consumes 5 accordions and 40 bagpipes while Poland produces and consumes 25 bagpipes and 100 accordions, then we say that Poland and Scotland are:

Which of the following trade agreements took effect in 1994 and, over a 15- year period, will eliminate all tariffs and other trade barriers between its members?

Using a graph, illustrate what the market effects of a quota, a tariff, or a complete ban on imports would be.

Recall Application 4, "Trade, Consumption and Inequality," to answer the following questions: -According to the application, what was the moral of the story concerning free trade?

Exporting nations often agree to voluntary export restraints in an attempt to:

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

If Cowland can produce milk at a lower opportunity cost than any other nation, Cowland is said to have a(n) _______ in the production of milk.

From the perspective of consumers, a quota is preferred to a tariff.

Recall Application 3, "Are They Really Dumping?" to answer the following questions: -Based on what you learned from the application, how will the "constructed value" method used by the Department of Commerce affect the number of cases that it will deem as dumping?

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

-Refer to Table 18.2. After trade begins, _ will specialize in the production of stereos and _ will specialize in the production of tractors.