Question 1

Several arguments for restricting trade have been advanced. Those arguments do not include

Accepted Answer

A) the jobs argument. 
B) the protection-as-a-bargaining-chip argument. 
C) the no-deadweight-loss argument. 
D) the infant-industry argument. 
A) the jobs argument. 
B) the protection-as-a-bargaining-chip argument. 
C) the no-deadweight-loss argument. 
D) the infant-industry argument.

Question 2

Scenario 9-3
Suppose domestic demand and domestic supply in a market are given by the following equations:  
-Refer to Scenario 9-3. Suppose the world price in this market is $8 per unit, and suppose the country imposes a $1 per unit tariff. If the country allows trade with a tariff, how much is the deadweight loss caused by the tariff?

Accepted Answer

The deadwe

Question 3

Suppose in the country of Nash that the price of oranges is $8 per bushel with no trade allowed. If the world price of oranges is $10 per bushel and if Nash allows free trade, will Nash be an importer or an exporter of oranges?

Accepted Answer

Nash will

Question 4

Figure 9-13  
-Refer to Figure 9-13. The price and domestic quantity demanded after trade are

Accepted Answer

A) $8 and 300. 
B) $8 and 900. 
C) $14 and 900. 
D) $14 and 600. 
A) $8 and 300. 
B) $8 and 900. 
C) $14 and 900. 
D) $14 and 600.

Question 5

When markets open up to international trade, we know that consumer surplus will rise.​

Accepted Answer

A) True 
 B)False

Question 6

Figure 9-27
The following diagram shows the domestic demand and supply curves in a market. Assume that the world price in this market is $20 per unit.  
-Refer to Figure 9-27. With no trade allowed, how much are consumer surplus, producer surplus, and total surplus?

Accepted Answer

Without trade, consu

Question 7

Both tariffs and import quotas

Accepted Answer

A) increase the quantity of imports and raise the domestic price of the good. 
B) increase the quantity of imports and lower the domestic price of the good. 
C) decrease the quantity of imports and raise the domestic price of the good. 
D) decrease the quantity of imports and lower the domestic price of the good. 
A) increase the quantity of imports and raise the domestic price of the good. 
B) increase the quantity of imports and lower the domestic price of the good. 
C) decrease the quantity of imports and raise the domestic price of the good. 
D) decrease the quantity of imports and lower the domestic price of the good.

Question 8

​Imposing a tariff on the import of a good is preferable to a quota because a tariff produces revenue for the government, while a quota never produces any revenue for a government.

Accepted Answer

A) True 
 B)False

Question 9

Suppose the world price of coffee is $2 per pound and Brazil's domestic price of coffee without trade is $3 per pound. If Brazil allows free trade, will Brazil be an importer or an exporter of coffee?

Accepted Answer

Brazil wil

Question 10

Scenario 9-2
• For a small country called Boxland, the equation of the domestic demand curve for
cardboard is   ,
where   represents the domestic quantity of cardboard demanded, in tons, and   represents the price of a ton of cardboard.
• For Boxland, the equation of the domestic supply curve for cardboard is   ,
where   represents the domestic quantity of cardboard supplied, in tons, and   again
represents the price of a ton of cardboard.
-Refer to Scenario 9-2. Suppose the world price of cardboard is $60. Then, if Boxland goes from prohibiting international trade in cardboard to allowing international trade in cardboard,

Accepted Answer

A) domestic producers of cardboard become better off and domestic consumers of cardboard become better off. 
B) domestic producers of cardboard become better off and domestic consumers of cardboard become worse off. 
C) domestic producers of cardboard become worse off and domestic consumers of cardboard become better off. 
D) domestic producers of cardboard become worse off and domestic consumers of cardboard become worse off. 
A) domestic producers of cardboard become better off and domestic consumers of cardboard become better off. 
B) domestic producers of cardboard become better off and domestic consumers of cardboard become worse off. 
C) domestic producers of cardboard become worse off and domestic consumers of cardboard become better off. 
D) domestic producers of cardboard become worse off and domestic consumers of cardboard become worse off.

Question 11

Figure 9-1
The figure illustrates the market for coffee in Guatemala.  
-Refer to Figure 9-1. Relative to the no-trade situation, trade with the rest of the world results in

Accepted Answer

A) Guatemalan consumers paying a higher price for coffee. 
B) a decrease in producer surplus in Guatemala. 
C) a decrease in total surplus in Guatemala. 
D) All of the above are correct. 
A) Guatemalan consumers paying a higher price for coffee. 
B) a decrease in producer surplus in Guatemala. 
C) a decrease in total surplus in Guatemala. 
D) All of the above are correct.

Question 12

Figure 9-10. The figure applies to Mexico and the good is rifles.  
-Refer to Figure 9-10. Mexico's gains from trade are represented by the area that is bounded by the points

Accepted Answer

A) (0, P0), (Q0, P0), (Q2, P1), and (0, P1). 
B) (0, P1), (0, P2), (Q0, P0), and (Q1, P1). 
C) (Q0, P0), (Q2, P1), and (Q1, P1). 
D) (0, P0), (0, P2), and (Q0, P0). 
A) (0, P0), (Q0, P0), (Q2, P1), and (0, P1). 
B) (0, P1), (0, P2), (Q0, P0), and (Q1, P1). 
C) (Q0, P0), (Q2, P1), and (Q1, P1). 
D) (0, P0), (0, P2), and (Q0, P0).

Question 13

Figure 9-7. The figure applies to the nation of Wales and the good is cheese.  
-Refer to Figure 9-7. The equilibrium price and the equilibrium quantity of cheese in Wales before trade are

Accepted Answer

A) P1 and Q2. 
B) P1 and Q1. 
C) P0 and Q0. 
D) P0 and Q1. 
A) P1 and Q2. 
B) P1 and Q1. 
C) P0 and Q0. 
D) P0 and Q1.

Question 14

When a country that imports shoes imposes a tariff on shoes, buyers of shoes in that country become worse off.

Accepted Answer

A) True 
 B)False

Question 15

Domestic consumers gain and domestic producers lose when the government imposes a tariff on imports.

Accepted Answer

A) True 
 B)False

Question 16

Figure 9-18. On the diagram below, Q represents the quantity of peaches and P represents the price of peaches. The domestic country is Isoland.  
-Refer to Figure 9-18. If Isoland allows international trade and if the world price of peaches is $5, then

Accepted Answer

A) Isoland has a comparative advantage, relative to other countries, in producing peaches. 
B) Isoland will import peaches. 
C) consumer surplus with trade exceeds consumer surplus without trade. 
D) All of the above are correct. 
A) Isoland has a comparative advantage, relative to other countries, in producing peaches. 
B) Isoland will import peaches. 
C) consumer surplus with trade exceeds consumer surplus without trade. 
D) All of the above are correct.

Question 17

A tariff on a product makes

Accepted Answer

A) domestic sellers better off and domestic buyers worse off. 
B) domestic sellers worse off and domestic buyers worse off. 
C) domestic sellers better off and domestic buyers better off. 
D) domestic sellers worse off and domestic buyers better off. 
A) domestic sellers better off and domestic buyers worse off. 
B) domestic sellers worse off and domestic buyers worse off. 
C) domestic sellers better off and domestic buyers better off. 
D) domestic sellers worse off and domestic buyers better off.

Question 18

If Freedonia changes its laws to allow international trade in software and the world price is higher than its domestic price, then it must be the case that

Accepted Answer

A) both consumer surplus and producer surplus increase. 
B) consumer surplus increases and producer surplus decreases. 
C) consumer surplus decreases and producer surplus increases. 
D) both consumer surplus and producer surplus decrease. 
A) both consumer surplus and producer surplus increase. 
B) consumer surplus increases and producer surplus decreases. 
C) consumer surplus decreases and producer surplus increases. 
D) both consumer surplus and producer surplus decrease.

Question 19

Figure 9-17  
-Refer to Figure 9-17. When comparing no trade to free trade, the gains from trade amount to

Accepted Answer

A) $400. 
B) $600. 
C) $750. 
D) $1,000. 
A) $400. 
B) $600. 
C) $750. 
D) $1,000.

Question 20

The sum of consumer and producer surplus measures the total benefits that buyers and sellers receive from participating in a market.

Accepted Answer

A) True 
 B)False

Several arguments for restricting trade have been advanced. Those arguments do not include

Suppose in the country of Nash that the price of oranges is $8 per bushel with no trade allowed. If the world price of oranges is $10 per bushel and if Nash allows free trade, will Nash be an importer or an exporter of oranges?

Figure 9-13 -Refer to Figure 9-13. The price and domestic quantity demanded after trade are

When markets open up to international trade, we know that consumer surplus will rise.

Figure 9-27 The following diagram shows the domestic demand and supply curves in a market. Assume that the world price in this market is $20 per unit. -Refer to Figure 9-27. With no trade allowed, how much are consumer surplus, producer surplus, and total surplus?

Both tariffs and import quotas

Imposing a tariff on the import of a good is preferable to a quota because a tariff produces revenue for the government, while a quota never produces any revenue for a government.

Suppose the world price of coffee is $2 per pound and Brazil's domestic price of coffee without trade is $3 per pound. If Brazil allows free trade, will Brazil be an importer or an exporter of coffee?

Figure 9-1 The figure illustrates the market for coffee in Guatemala. -Refer to Figure 9-1. Relative to the no-trade situation, trade with the rest of the world results in

Figure 9-10. The figure applies to Mexico and the good is rifles. -Refer to Figure 9-10. Mexico's gains from trade are represented by the area that is bounded by the points

Figure 9-7. The figure applies to the nation of Wales and the good is cheese. -Refer to Figure 9-7. The equilibrium price and the equilibrium quantity of cheese in Wales before trade are

When a country that imports shoes imposes a tariff on shoes, buyers of shoes in that country become worse off.

Domestic consumers gain and domestic producers lose when the government imposes a tariff on imports.

Figure 9-18. On the diagram below, Q represents the quantity of peaches and P represents the price of peaches. The domestic country is Isoland. -Refer to Figure 9-18. If Isoland allows international trade and if the world price of peaches is $5, then

A tariff on a product makes

If Freedonia changes its laws to allow international trade in software and the world price is higher than its domestic price, then it must be the case that

Figure 9-17 -Refer to Figure 9-17. When comparing no trade to free trade, the gains from trade amount to

The sum of consumer and producer surplus measures the total benefits that buyers and sellers receive from participating in a market.

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, Demand, and Government Policies

Consumers, Producers, and the Efficiency of Markets

Application: The Costs of Taxation

Externalities

Public Goods and Common Resources

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers in Microeconomics

Filters

Exam 9: Application: International Trade

Several arguments for restricting trade have been advanced. Those arguments do not include

Suppose in the country of Nash that the price of oranges is $8 per bushel with no trade allowed. If the world price of oranges is $10 per bushel and if Nash allows free trade, will Nash be an importer or an exporter of oranges?

Figure 9-13 -Refer to Figure 9-13. The price and domestic quantity demanded after trade are

When markets open up to international trade, we know that consumer surplus will rise.​

Figure 9-27 The following diagram shows the domestic demand and supply curves in a market. Assume that the world price in this market is $20 per unit. -Refer to Figure 9-27. With no trade allowed, how much are consumer surplus, producer surplus, and total surplus?

Both tariffs and import quotas

​Imposing a tariff on the import of a good is preferable to a quota because a tariff produces revenue for the government, while a quota never produces any revenue for a government.

Suppose the world price of coffee is $2 per pound and Brazil's domestic price of coffee without trade is $3 per pound. If Brazil allows free trade, will Brazil be an importer or an exporter of coffee?

Figure 9-1 The figure illustrates the market for coffee in Guatemala. -Refer to Figure 9-1. Relative to the no-trade situation, trade with the rest of the world results in

Figure 9-10. The figure applies to Mexico and the good is rifles. -Refer to Figure 9-10. Mexico's gains from trade are represented by the area that is bounded by the points

Figure 9-7. The figure applies to the nation of Wales and the good is cheese. -Refer to Figure 9-7. The equilibrium price and the equilibrium quantity of cheese in Wales before trade are

When a country that imports shoes imposes a tariff on shoes, buyers of shoes in that country become worse off.

Domestic consumers gain and domestic producers lose when the government imposes a tariff on imports.

Figure 9-18. On the diagram below, Q represents the quantity of peaches and P represents the price of peaches. The domestic country is Isoland. -Refer to Figure 9-18. If Isoland allows international trade and if the world price of peaches is $5, then

A tariff on a product makes

If Freedonia changes its laws to allow international trade in software and the world price is higher than its domestic price, then it must be the case that

Figure 9-17 -Refer to Figure 9-17. When comparing no trade to free trade, the gains from trade amount to

The sum of consumer and producer surplus measures the total benefits that buyers and sellers receive from participating in a market.

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, Demand, and Government Policies

Consumers, Producers, and the Efficiency of Markets

Application: The Costs of Taxation

Externalities

Public Goods and Common Resources

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers in Microeconomics

Filters

When markets open up to international trade, we know that consumer surplus will rise.

Imposing a tariff on the import of a good is preferable to a quota because a tariff produces revenue for the government, while a quota never produces any revenue for a government.