Exam 20: International Trade, Comparative Advantage, and Protectionism

Which of the following statements is true?

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. Mexico has

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 Guatemala, the opportunity cost of 1 bushel of oranges is

According to the theory of comparative advantage, a country should

Suppose that the United States and Italy both produce wine and shoes. In the United States, wine sells for $10 a bottle and shoes sell for $40 a pair. In Italy, wine sells for 15 euros a bottle and shoes sell for 20 euros a pair. Given this information, trade will flow in both directions if the price of a dollar is between

Suppose that the United States and Spain both produce cognac and handbags. In the United States, cognac sells for $20 a bottle and handbags sell for $80. In Spain, cognac sells for 30 euros a bottle and handbags sell for 40 euros. Given this information, trade will flow in both directions if the price of a dollar is between

Suppose a U.S. dollar exchanges for 0.8 euros, then each euro is worth

Related to the Economics in Practice on page 673: Satirist Frederic Bastiat's essay arguing for a quota on sunlight in order to protect domestic candle makers suggests that it is pointless to

A tax on imports is a(n)

If a country has a trade surplus of $60 billion, which of the following can be true?

The United States would have an absolute advantage compared to Canada in the production of wheat if

Related to the Economics in Practice on page 667: When a country lifts a quota, imports to that country generally ________ and the price of the affected product in that country generally ________.

If the exchange rate between the United States and Mexico changes from $1 = 100 pesos to $1 = 5 pesos, ceteris paribus

The main advantage of ________ is the ability to move out beyond previous resource and production constraints.

Refer to the information provided in Figure 20.1 below to answer the question(s) that follow. Figure 20.1 -Refer to Figure 20.1. The opportunity cost of producing a bushel of soybeans in the United States is

A significant portion of actual world trade patterns results from

Economic integration

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. With free trade domestic production is

When a nation's exports are less than its imports, it has a

Refer to the information provided in Figure 20.5 below to answer the question(s) that follow. Figure 20.5 -Refer to Figure 20.5. The domestic price of oil is $130 per barrel, and the world price of oil is $120 per barrel. If the domestic government imposes a tariff of $________ per barrel, it will eliminate all oil imports and achieve tariff revenues of $________.