Question 1

Faced with the evidence of poor working conditions and low wages in the border maquiladoras,economists

Accepted Answer

A) argue that U.S.consumers should not consume lettuce. 
B) argue that the poor conditions and low wages are actually improvements for the Mexican workers,and may be cited as gains- from- trade. 
C) argue that Mexico's generally high overall productivity offsets these conditions. 
D) agree that trade theory is thus proven hollow and internally inconsistent. 
E) shrug their shoulders and ignore the issue. 
A) argue that U.S.consumers should not consume lettuce. 
B) argue that the poor conditions and low wages are actually improvements for the Mexican workers,and may be cited as gains- from- trade. 
C) argue that Mexico's generally high overall productivity offsets these conditions. 
D) agree that trade theory is thus proven hollow and internally inconsistent. 
E) shrug their shoulders and ignore the issue.

Question 2

Labor standards in trade are typically opposed by most developing countries who believe that they will be used

Accepted Answer

A) as a protectionist tool by import- competing producers in industrial countries. 
B) to further neo- imperialist colonial exploitation. 
C) to charge these countries with crimes against child- labor standards at the Hague. 
D) as a means of spreading U.S.Corporate Values and destroying local cultures. 
E) to hinder investment in foreign- based multinational corporations. 
A) as a protectionist tool by import- competing producers in industrial countries. 
B) to further neo- imperialist colonial exploitation. 
C) to charge these countries with crimes against child- labor standards at the Hague. 
D) as a means of spreading U.S.Corporate Values and destroying local cultures. 
E) to hinder investment in foreign- based multinational corporations.

Question 3

When Japan's MITI (Ministry of International Trade and Industry)focused resources on the semiconductor industry,and in particular on Random Access Memory (RAM),it was viewed as a typically successful Japanese foray into a new dynamic strategic sector.The results,as viewed by the late 1990s

Accepted Answer

A) justified this view. 
B) propelled Japan into the leading country in high- tech manufacturing. 
C) led to similar structuring of industrial policy in the U.S. 
D) helped shift the focus of economists away from Japanese- style industrial policy. 
E) lent support to the Brander- Spencer model. 
A) justified this view. 
B) propelled Japan into the leading country in high- tech manufacturing. 
C) led to similar structuring of industrial policy in the U.S. 
D) helped shift the focus of economists away from Japanese- style industrial policy. 
E) lent support to the Brander- Spencer model.

Question 4

Japan's protection of its semiconductor (RAM)producers is today seen as an object lesson in

Accepted Answer

A) how monopolies can outlast government intervention. 
B) how strategic planning may backfire and cause a large waste of resources. 
C) how externalities may be successfully exploited by protectionist policies. 
D) how government intervention may create a meaningful comparative advantage. 
E) how excess returns may be successfully exploited by protectionist policies. 
A) how monopolies can outlast government intervention. 
B) how strategic planning may backfire and cause a large waste of resources. 
C) how externalities may be successfully exploited by protectionist policies. 
D) how government intervention may create a meaningful comparative advantage. 
E) how excess returns may be successfully exploited by protectionist policies.

Question 5

The Shipbreakers of Alang utilize much labor and little capital,thereby supporting the applicability of the

Accepted Answer

A) monopolistic competition theory of comparative advantage. 
B) basis of the non- dumping legislation. 
C) scale economies theory of comparative advantage. 
D) factor proportions explanation of the sources of comparative advantage. 
E) specific factor theory of comparative advantage. 
A) monopolistic competition theory of comparative advantage. 
B) basis of the non- dumping legislation. 
C) scale economies theory of comparative advantage. 
D) factor proportions explanation of the sources of comparative advantage. 
E) specific factor theory of comparative advantage.

Question 6

The shipbreakers of Alang are

Accepted Answer

A) competing with pollution- producing industries in countries outside of India. 
B) doing environmentally conscious work. 
C) a metaphysical representation of the WTO,deriving from Edgar Rice Burroughs' Princess of Mars. 
D) an early version of the Russian Ice- breaker of the Dnieper- Alang class. 
E) a capital- intensive industry. 
A) competing with pollution- producing industries in countries outside of India. 
B) doing environmentally conscious work. 
C) a metaphysical representation of the WTO,deriving from Edgar Rice Burroughs' Princess of Mars. 
D) an early version of the Russian Ice- breaker of the Dnieper- Alang class. 
E) a capital- intensive industry.

Question 7

The best economic case one can make for an active industrial policy involves

Accepted Answer

A) the high value added argument. 
B) raising the national income. 
C) the environment preservation argument. 
D) the technological spillover argument. 
E) the national security argument. 
A) the high value added argument. 
B) raising the national income. 
C) the environment preservation argument. 
D) the technological spillover argument. 
E) the national security argument.

Question 8

The United States

Accepted Answer

A) provides support for R&D through grant incentives. 
B) does not provide more support for R&D as compared to other forms of investment. 
C) provides support for R&D by providing direct subsidies for such activities. 
D) provides support for R&D through tax legislation. 
E) provides support for R&D by imposing high tariffs on R&D intensive products. 
A) provides support for R&D through grant incentives. 
B) does not provide more support for R&D as compared to other forms of investment. 
C) provides support for R&D by providing direct subsidies for such activities. 
D) provides support for R&D through tax legislation. 
E) provides support for R&D by imposing high tariffs on R&D intensive products.

Question 9

In the second half of the 1990s a rapidly growing movement focused on the harm caused by international trade to

Accepted Answer

A) land owners in poor countries. 
B) land owners in rich industrialized countries. 
C) capital owners in rich industrialized countries. 
D) production workers in both rich and poor countries. 
E) terms of trade in developing countries. 
A) land owners in poor countries. 
B) land owners in rich industrialized countries. 
C) capital owners in rich industrialized countries. 
D) production workers in both rich and poor countries. 
E) terms of trade in developing countries.

Question 10

It is argued that high- tech industries typically generate new technologies but cannot fully appropriate the commercial benefits associated with their inventions or discoveries.If this is TRUE,then in order to maximize a country's real income,the government should

Accepted Answer

A) protect the high- tech firms. 
B) subsidize the high- tech firms. 
C) tax the high- tech firms. 
D) discourage high- tech investments. 
E) outsource high- tech production. 
A) protect the high- tech firms. 
B) subsidize the high- tech firms. 
C) tax the high- tech firms. 
D) discourage high- tech investments. 
E) outsource high- tech production.

Question 11

When one applies the Heckscher- Ohlin model of trade to the issue of trade- related income redistributions,one must conclude that North- South trade,such as U.S.- Mexico trade

Accepted Answer

A) is likely to hurt low- skilled workers in Mexico. 
B) is likely to help highly skilled workers in Mexico. 
C) is likely to hurt high- skilled workers in the U.S. 
D) is likely to hurt low- skilled workers in the U.S. 
E) must help low- skilled workers on both sides of the border. 
A) is likely to hurt low- skilled workers in Mexico. 
B) is likely to help highly skilled workers in Mexico. 
C) is likely to hurt high- skilled workers in the U.S. 
D) is likely to hurt low- skilled workers in the U.S. 
E) must help low- skilled workers on both sides of the border.

Question 12

The evidence usually cited to prove that globalization hurts workers in developing countries

Accepted Answer

A) is conclusive. 
B) is inconclusive due to poor statistical design of the underlying samples. 
C) is inconclusive due to the poorly funded Central Statistical Office of Mexico. 
D) does not take into account the Heckscher- Ohlin model. 
E) is inconclusive due to the ambiguous theoretical implications of the findings. 
A) is conclusive. 
B) is inconclusive due to poor statistical design of the underlying samples. 
C) is inconclusive due to the poorly funded Central Statistical Office of Mexico. 
D) does not take into account the Heckscher- Ohlin model. 
E) is inconclusive due to the ambiguous theoretical implications of the findings.

Question 13

The argument that strategic planning is NOT likely to be practical due to insufficient information means that

Accepted Answer

A) the government would need to employ its intelligence agencies in order to gain a complete understanding of the market. 
B) due to recent cuts in the Department of the Census' sampling budgets,industry surveys are no longer reliable,so that there is no way to determine if a subsidy is in the public's interest. 
C) if the government had all the relevant information in a given industry then it could decide whether a subsidy would enhance the public's welfare. 
D) because of trade secrets,the government does not know true cost relationships in any given industry. 
E) even if the government had all the relevant information in a given industry,it still could not decide whether a subsidy would enhance the public's welfare. 
A) the government would need to employ its intelligence agencies in order to gain a complete understanding of the market. 
B) due to recent cuts in the Department of the Census' sampling budgets,industry surveys are no longer reliable,so that there is no way to determine if a subsidy is in the public's interest. 
C) if the government had all the relevant information in a given industry then it could decide whether a subsidy would enhance the public's welfare. 
D) because of trade secrets,the government does not know true cost relationships in any given industry. 
E) even if the government had all the relevant information in a given industry,it still could not decide whether a subsidy would enhance the public's welfare.

Question 14

If firms in an industry are generating knowledge that other firms can use without paying for it,this industry is characterized by

Accepted Answer

A) social costs that exceed private costs. 
B) social benefits that undermine private benefits. 
C) social benefits that exceed private benefits. 
D) private benefits that exceed social benefits. 
E) social costs that exceed social benefits. 
A) social costs that exceed private costs. 
B) social benefits that undermine private benefits. 
C) social benefits that exceed private benefits. 
D) private benefits that exceed social benefits. 
E) social costs that exceed social benefits.

Question 15

The fact that articles of clothing sold in Walmart are produced by very poorly paid workers in Honduras,is a fact that if taken into account

Accepted Answer

A) would prove to economists that the Ricardian model of comparative advantage is false. 
B) proves that corporations are exempt from labor standards. 
C) proves to the Anti- Globalization Movement that trade is a negative sum game. 
D) proves to economists that trade is a negative sum game. 
E) would prove to economists that the equal- value in trade concept summed up in the trade triangles is incorrect. 
A) would prove to economists that the Ricardian model of comparative advantage is false. 
B) proves that corporations are exempt from labor standards. 
C) proves to the Anti- Globalization Movement that trade is a negative sum game. 
D) proves to economists that trade is a negative sum game. 
E) would prove to economists that the equal- value in trade concept summed up in the trade triangles is incorrect.

Faced with the evidence of poor working conditions and low wages in the border maquiladoras,economists

Labor standards in trade are typically opposed by most developing countries who believe that they will be used

When Japan's MITI (Ministry of International Trade and Industry)focused resources on the semiconductor industry,and in particular on Random Access Memory (RAM),it was viewed as a typically successful Japanese foray into a new dynamic strategic sector.The results,as viewed by the late 1990s

Japan's protection of its semiconductor (RAM)producers is today seen as an object lesson in

The Shipbreakers of Alang utilize much labor and little capital,thereby supporting the applicability of the

The shipbreakers of Alang are

The best economic case one can make for an active industrial policy involves

The United States

In the second half of the 1990s a rapidly growing movement focused on the harm caused by international trade to

It is argued that high- tech industries typically generate new technologies but cannot fully appropriate the commercial benefits associated with their inventions or discoveries.If this is TRUE,then in order to maximize a country's real income,the government should

When one applies the Heckscher- Ohlin model of trade to the issue of trade- related income redistributions,one must conclude that North- South trade,such as U.S.- Mexico trade

The evidence usually cited to prove that globalization hurts workers in developing countries

The argument that strategic planning is NOT likely to be practical due to insufficient information means that

If firms in an industry are generating knowledge that other firms can use without paying for it,this industry is characterized by

The fact that articles of clothing sold in Walmart are produced by very poorly paid workers in Honduras,is a fact that if taken into account

Introduction

World Trade: an Overview

Labor Productivity and Comparative Advantage: the Ricardian Model

Specific Factors and Income Distribution

Resources and Trade: the Heckscher-Ohlin Model

The Standard Trade Model

External Economies of Scale and the International Location of Production

Firms in the Global Economy: Export Decisions,outsourcing,and Multinational Enterprises

The Instruments of Trade Policy

The Political Economy of Trade Policy

Trade Policy in Developing Countries

Filters

Exam 12: Controversies in Trade Policy

Faced with the evidence of poor working conditions and low wages in the border maquiladoras,economists

Labor standards in trade are typically opposed by most developing countries who believe that they will be used

When Japan's MITI (Ministry of International Trade and Industry)focused resources on the semiconductor industry,and in particular on Random Access Memory (RAM),it was viewed as a typically successful Japanese foray into a new dynamic strategic sector.The results,as viewed by the late 1990s

Japan's protection of its semiconductor (RAM)producers is today seen as an object lesson in

The Shipbreakers of Alang utilize much labor and little capital,thereby supporting the applicability of the

The shipbreakers of Alang are

The best economic case one can make for an active industrial policy involves

The United States

In the second half of the 1990s a rapidly growing movement focused on the harm caused by international trade to

It is argued that high- tech industries typically generate new technologies but cannot fully appropriate the commercial benefits associated with their inventions or discoveries.If this is TRUE,then in order to maximize a country's real income,the government should

When one applies the Heckscher- Ohlin model of trade to the issue of trade- related income redistributions,one must conclude that North- South trade,such as U.S.- Mexico trade

The evidence usually cited to prove that globalization hurts workers in developing countries

The argument that strategic planning is NOT likely to be practical due to insufficient information means that

If firms in an industry are generating knowledge that other firms can use without paying for it,this industry is characterized by

The fact that articles of clothing sold in Walmart are produced by very poorly paid workers in Honduras,is a fact that if taken into account

Introduction

World Trade: an Overview

Labor Productivity and Comparative Advantage: the Ricardian Model

Specific Factors and Income Distribution

Resources and Trade: the Heckscher-Ohlin Model

The Standard Trade Model

External Economies of Scale and the International Location of Production

Firms in the Global Economy: Export Decisions,outsourcing,and Multinational Enterprises

The Instruments of Trade Policy

The Political Economy of Trade Policy

Trade Policy in Developing Countries

Filters