Question 1

-Refer to Table 18.2. The opportunity cost of tractors in the U.S. is:

Accepted Answer

A)  2 stereos. 
B)  1/2 stereo. 
C)  4 stereos. 
D)  1/4 stereo. 
A)  2 stereos. 
B)  1/2 stereo. 
C)  4 stereos. 
D)  1/4 stereo.

Question 2

-Refer to Table 18.1. The nation with a comparative advantage in accordions is:

Accepted Answer

A)  neither Scotland nor Poland. 
B)  Poland. 
C)  Scotland. 
D)  both Scotland and Poland. 
A)  neither Scotland nor Poland. 
B)  Poland. 
C)  Scotland. 
D)  both Scotland and Poland.

Question 3

Figure 18.5
-For the good in Figure 18.5, with free trade, the people in the country will buy:

Accepted Answer

A)  Q4. 
B)  Q3. 
C)  Q5. 
D)  Q2. 
A)  Q4. 
B)  Q3. 
C)  Q5. 
D)  Q2.

Question 4

Suppose Canada produces only two goods, corn and automobiles. If Canada has a comparative advantage in automobiles, a move toward free trade will:

Accepted Answer

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

Question 5

The example of the VCRs from Korea illustrates dumping due to:

Accepted Answer

A)  predatory pricing. 
B)  price discrimination. 
C)  avoidance of environmental laws. 
D)  retaliatory trade practices. 
A)  predatory pricing. 
B)  price discrimination. 
C)  avoidance of environmental laws. 
D)  retaliatory trade practices.

Question 6

Under current WTO rules, a country can adopt:

Accepted Answer

A)  only WTO- approved environmental standards. 
B)  any environmental standard it chooses, even if it discriminates against foreign producers. 
C)  only the same environmental standards as its immediate geographic neighbors. 
D)  any environmental standard it chooses as long as it does not discriminate against foreign producers. 
A)  only WTO- approved environmental standards. 
B)  any environmental standard it chooses, even if it discriminates against foreign producers. 
C)  only the same environmental standards as its immediate geographic neighbors. 
D)  any environmental standard it chooses as long as it does not discriminate against foreign producers.

Question 7

Which of the following is a criticism that economists have against regional free trade areas?

Accepted Answer

A)  Some countries have abandoned the WTO to join the regional trade areas. 
B)  Regional trade areas have been more successful in promoting worldwide trade than the WTO. 
C)  Regional trade areas promote trade within the trade area, but they do little to promote trade across the globe. 
D)  Regional trade areas require that member countries first withdraw membership from the WTO. 
A)  Some countries have abandoned the WTO to join the regional trade areas. 
B)  Regional trade areas have been more successful in promoting worldwide trade than the WTO. 
C)  Regional trade areas promote trade within the trade area, but they do little to promote trade across the globe. 
D)  Regional trade areas require that member countries first withdraw membership from the WTO.

Question 8

Figure 18.4
-Refer to Figure 18.4. With free trade, how many artichokes are produced domestically in Duckland?

Accepted Answer

A)  0 
B)  65 
C)  30 
D)  75 
A)  0 
B)  65 
C)  30 
D)  75

Question 9

What are the rationales for protectionist policies?

Accepted Answer

The rationales for protectioni

Question 10

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

Accepted Answer

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

Question 11

Recall Application 1, "The Impact of Tariffs on the Poor," to answer the following questions:
-What proof does the application use to illustrate that tariffs hurt the poor more than the rich?

Accepted Answer

A)  The total amount of dollars paid by the poor in the form of import tariffs is larger than the rich. 
B)  The amount of dollars paid by the poor in the form of income taxes is higher with poor individuals than rich individuals. 
C)  The proportion of tariffs paid relative to expenditures is lower on the poor than the rich. 
D)  The proportion of tariffs paid relative to expenditures is higher on the poor than the rich. 
A)  The total amount of dollars paid by the poor in the form of import tariffs is larger than the rich. 
B)  The amount of dollars paid by the poor in the form of income taxes is higher with poor individuals than rich individuals. 
C)  The proportion of tariffs paid relative to expenditures is lower on the poor than the rich. 
D)  The proportion of tariffs paid relative to expenditures is higher on the poor than the rich.

Question 12

If the opportunity cost of a table is 5 chairs in nation A and 1 chair in nation B, it makes sense for nation A to produce chairs.

Accepted Answer

A) True 
 B)False

Question 13

Figure 18.2
-Refer to Figure 18.2. In autarky, the maximum amount of cheese that Pizzaland can produce is:

Accepted Answer

A)  120. 
B)  90. 
C)  80. 
D)  150. 
A)  120. 
B)  90. 
C)  80. 
D)  150.

Question 14

Regional agreements help GATT reach agreements faster.

Accepted Answer

A) True 
 B)False

Question 15

Recall Application 2, "Protection for Candle Makers," to answer the following questions:
-In the application, what were some of the solutions that Bastiat proposed to protect candle makers from unfair competition from the sun?

Accepted Answer

A)  Dim all blinds. 
B)  Close all windows. 
C)  Patch up all holes, chinks, and fissures through which light may pass. 
D)  All of the above are correct. 
A)  Dim all blinds. 
B)  Close all windows. 
C)  Patch up all holes, chinks, and fissures through which light may pass. 
D)  All of the above are correct.

Question 16

A tax on an imported good is known as a(n):

Accepted Answer

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

Question 17

A limit on the amount of a good that can be imported is known as:

Accepted Answer

A)  a tariff. 
B)  a tax. 
C)  an import quota. 
D)  an export agreement. 
A)  a tariff. 
B)  a tax. 
C)  an import quota. 
D)  an export agreement.

Question 18

Figure 18.3
-Refer to Figure 18.3. With a tariff or quota, the equilibrium quantity is:

Accepted Answer

A)  60. 
B)  80. 
C)  40. 
D)  100. 
A)  60. 
B)  80. 
C)  40. 
D)  100.

Question 19

If a country bans the importation of a particular good, the market equilibrium is shown by the intersection of the demand and domestic supply curves.

Accepted Answer

A) True 
 B)False

Question 20

A voluntary export restraint is a trade policy by which a nation agrees to limit its:

Accepted Answer

A)  exports of a good in order to avoid more restrictive trade policies. 
B)  imports of a good. 
C)  imports of a good, but only under the threat of more restrictive trade policies. 
D)  exports of a good in order to increase employment. 
A)  exports of a good in order to avoid more restrictive trade policies. 
B)  imports of a good. 
C)  imports of a good, but only under the threat of more restrictive trade policies. 
D)  exports of a good in order to increase employment.

-Refer to Table 18.2. The opportunity cost of tractors in the U.S. is:

-Refer to Table 18.1. The nation with a comparative advantage in accordions is:

Figure 18.5 -For the good in Figure 18.5, with free trade, the people in the country will buy:

Suppose Canada produces only two goods, corn and automobiles. If Canada has a comparative advantage in automobiles, a move toward free trade will:

The example of the VCRs from Korea illustrates dumping due to:

Under current WTO rules, a country can adopt:

Which of the following is a criticism that economists have against regional free trade areas?

Figure 18.4 -Refer to Figure 18.4. With free trade, how many artichokes are produced domestically in Duckland?

What are the rationales for protectionist policies?

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

Recall Application 1, "The Impact of Tariffs on the Poor," to answer the following questions: -What proof does the application use to illustrate that tariffs hurt the poor more than the rich?

If the opportunity cost of a table is 5 chairs in nation A and 1 chair in nation B, it makes sense for nation A to produce chairs.

Figure 18.2 -Refer to Figure 18.2. In autarky, the maximum amount of cheese that Pizzaland can produce is:

Regional agreements help GATT reach agreements faster.

Recall Application 2, "Protection for Candle Makers," to answer the following questions: -In the application, what were some of the solutions that Bastiat proposed to protect candle makers from unfair competition from the sun?

A tax on an imported good is known as a(n):

A limit on the amount of a good that can be imported is known as:

Figure 18.3 -Refer to Figure 18.3. With a tariff or quota, the equilibrium quantity is:

If a country bans the importation of a particular good, the market equilibrium is shown by the intersection of the demand and domestic supply curves.

A voluntary export restraint is a trade policy by which a nation agrees to limit its:

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

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Exam 18: International Trade and Public Policy

-Refer to Table 18.2. The opportunity cost of tractors in the U.S. is:

-Refer to Table 18.1. The nation with a comparative advantage in accordions is:

Figure 18.5 -For the good in Figure 18.5, with free trade, the people in the country will buy:

Suppose Canada produces only two goods, corn and automobiles. If Canada has a comparative advantage in automobiles, a move toward free trade will:

The example of the VCRs from Korea illustrates dumping due to:

Under current WTO rules, a country can adopt:

Which of the following is a criticism that economists have against regional free trade areas?

Figure 18.4 -Refer to Figure 18.4. With free trade, how many artichokes are produced domestically in Duckland?

What are the rationales for protectionist policies?

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

Recall Application 1, "The Impact of Tariffs on the Poor," to answer the following questions: -What proof does the application use to illustrate that tariffs hurt the poor more than the rich?

If the opportunity cost of a table is 5 chairs in nation A and 1 chair in nation B, it makes sense for nation A to produce chairs.

Figure 18.2 -Refer to Figure 18.2. In autarky, the maximum amount of cheese that Pizzaland can produce is:

Regional agreements help GATT reach agreements faster.

Recall Application 2, "Protection for Candle Makers," to answer the following questions: -In the application, what were some of the solutions that Bastiat proposed to protect candle makers from unfair competition from the sun?

A tax on an imported good is known as a(n):

A limit on the amount of a good that can be imported is known as:

Figure 18.3 -Refer to Figure 18.3. With a tariff or quota, the equilibrium quantity is:

If a country bans the importation of a particular good, the market equilibrium is shown by the intersection of the demand and domestic supply curves.

A voluntary export restraint is a trade policy by which a nation agrees to limit its:

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