Exam 20: International Trade, Comparative Advantage, and Protectionism

A country is said to have an absolute advantage over another country in the production of a product if it uses more resources to produce that product than the other country does.

Refer to the information provided in Figure 20.2 below to answer the question(s) that follow. Figure 20.2 -Refer to Figure 20.2. England has an absolute advantage in producing

If the domestic price is above the world price of a certain product, the domestic country will import the product.

When a nation's exports exceed its imports, it has a

A quota imposed on imported steel will cause the domestic ________ of steel to increase and the domestic ________ of steel to increase.

Refer to the information provided in Table 20.1 below to answer the question(s) that follow. Table 20.1 $\quad$$\quad$$\quad$$\quad$$\quad$ $\text {Mexico}$$\quad$ $\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\text {Guatemala}$ Oranges Bananas Oranges Bananas bushel/acre bushel/acre bushel/acre bushel/acre 200 0 50 0 160 40 40 20 120 80 30 40 80 120 20 60 40 160 10 80 0 200 0 100 -Refer to Table 20.1. Guatemala has

India has a comparative advantage compared to Spain in the production of clothing if

________ U.S. president(s) who has/have held office since GATT was signed has argued for free-trade policies, yet each one has used his powers to protect various sectors of the economy.

Related to the Economics in Practice on p. 673: Protectionism of the kind that is suggested in the petition of the candle makers would most likely result in

Refer to the information provided in Table 20.2 below to answer the question(s) that follow. Table 20.2 China Thailand Tractors Motorcycles Tractors Motorcycles 0 300 0 300 5 250 5 225 10 200 10 150 15 150 15 75 20 100 20 0 25 50 - - 30 0 - - -Refer to Table 20.2. The most that Thailand will be willing to pay for a tractor is

In 1991, what group of countries began the process of forming the largest free-trade zone in the world?

Initially trade between Australia and the United States is balanced. Then, if a change in the exchange rate increases the U.S. dollar price of Australian goods, ceteris paribus, we would expect

It costs a television manufacturer $1,000 to produce a plasma television. This manufacturer sells these televisions abroad for $750. This is an example of

According to some environmental groups, free trade policies are potentially harmful to the environment.

If the United States increases the tariff on imported salmon, this will

Refer to the information provided in Figure 20.4 below to answer the question(s) that follow. Figure 20.4 -Refer to Figure 20.4. The domestic price of a leather wallet is $20. With free trade the price of a leather wallet is $10 and after a tariff is imposed the price is $15. After the tariff is imposed, this country will import ________ leather wallets.

Related to the Economics in Practice on p. 673: The French economy would most likely have to pay higher prices for candles if the candle makers in the petition

If Brazil has a comparative advantage in the production of coffee compared to the United States, then

Refer to the information provided in Table 20.1 below to answer the question(s) that follow. Table 20.1 $\quad$$\quad$$\quad$$\quad$$\quad$ $\text {Mexico}$$\quad$ $\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\text {Guatemala}$ Oranges Bananas Oranges Bananas bushel/acre bushel/acre bushel/acre bushel/acre 200 0 50 0 160 40 40 20 120 80 30 40 80 120 20 60 40 160 10 80 0 200 0 100 -Refer to Table 20.1. In Mexico, the opportunity cost of 1 bushel of bananas is

Refer to the information provided in Figure 20.2 below to answer the question(s) that follow. Figure 20.2 -Refer to Figure 20.2. The opportunity cost of 1 ________ is 0.25 ________ in the United States and 0.67 ________ in England.