Exam 5: International Trade

(Table: The Production Possibilities for Cars and Leather Boots) Use Table: The Production Possibilities for Cars and Leather Boots. The opportunity cost of producing one car in Mexico is:

Use the following to answer questions: -(Figure: A Tariff on Oranges in South Africa) Use Figure: A Tariff on Oranges in South Africa. When the government imposes a tariff on imported oranges, the price of oranges in South Africa rises from P_W to P_T and domestic consumer surplus _____ to _____.

In a single year, Argentina can raise 100 tons of beef or produce 1,000 boxes of tulips. In the same growing season, Venezuela can raise 50 tons of beef or produce 750 boxes of tulips. When the two countries begin trading beef for tulips, we expect the total surplus from beef consumption and production to:

Use the following to answer questions: -(Figure: The Market for Tea in Sri Lanka) Use Figure: The Market for Tea in Sri Lanka. In autarky, the price is P₁. When the economy is opened to trade, the price rises to P_W, and producer surplus _____ to _____.