Question 1

Exhibit 33-1
   ​
-Refer to Exhibit 33-1. Country B is the lower opportunity cost producer of

Accepted Answer

A) good Y. 
B) both goods. 
C) neither good. 
D) good X. 
A) good Y. 
B) both goods. 
C) neither good. 
D) good X.

Question 2

Major U.S. exports include automobiles and aircraft.

Accepted Answer

A) True 
 B)False

Question 3

Two major exports for the United States are

Accepted Answer

A) clothing and office machines. 
B) soybeans and scientific instruments. 
C) footwear and fish. 
D) coffee and diamonds. 
E) none of the above 
A) clothing and office machines. 
B) soybeans and scientific instruments. 
C) footwear and fish. 
D) coffee and diamonds. 
E) none of the above

Question 4

A quota on imported avocadoes ______________ the price of avocadoes, _____________ consumers' surplus for avocado buyers, _______________ producers' surplus of avocado growers and __________________ tariff revenue. Because the loss to _____________ is more than the gain to ___________________, there is a net loss to society.

Accepted Answer

A) raises; increases; decreases; generates; producers; consumers and government 
B) lowers; increases; decreases; does not generate; producers; consumers 
C) raises; increases; decreases; does not generate;consumers; producers and importers 
D) raises; decreases; increases; generates; consumers; producers and government 
A) raises; increases; decreases; generates; producers; consumers and government 
B) lowers; increases; decreases; does not generate; producers; consumers 
C) raises; increases; decreases; does not generate;consumers; producers and importers 
D) raises; decreases; increases; generates; consumers; producers and government

Question 5

Exhibit 33-10
  
-Refer to Exhibit 33-10. Who has the comparative advantage when it comes to mowing lawns?

Accepted Answer

A) Danielle 
B) Jason 
C) neither Jason nor Danielle 
D) both Danielle and Jason 
A) Danielle 
B) Jason 
C) neither Jason nor Danielle 
D) both Danielle and Jason

Question 6

Exhibit 33-6
​
  
-Refer to Exhibit 33-6. Which of the following terms of trade would both countries agree on?

Accepted Answer

A) 1 unit of wine = 2.5 units of cheese 
B) 1 unit of wine = 1.5 units of cheese 
C) 2.5 units of wine = 1 unit of cheese 
D) 1.5 units of wine = 1 unit of cheese 
E) none of the above 
A) 1 unit of wine = 2.5 units of cheese 
B) 1 unit of wine = 1.5 units of cheese 
C) 2.5 units of wine = 1 unit of cheese 
D) 1.5 units of wine = 1 unit of cheese 
E) none of the above

Question 7

Exhibit 33-3
​
  
-Refer to Exhibit 33-3. The world price is PW. If a tariff is imposed, the price rises to PW + T. Because of the tariff, government collects tariff revenues equal to the area of

Accepted Answer

A) 1. 
B) 1 + 2. 
C) 3. 
D) 1 + 2 + 4. 
E) 1 + 3. 
A) 1. 
B) 1 + 2. 
C) 3. 
D) 1 + 2 + 4. 
E) 1 + 3.

Question 8

Exhibit 33-1
   ​
-Refer to Exhibit 33-1. The opportunity cost of one unit of Y in country A is

Accepted Answer

A) 0.67 units of X. 
B) 0.75 units of X. 
C) 2 units of X. 
D) 10 units of X. 
A) 0.67 units of X. 
B) 0.75 units of X. 
C) 2 units of X. 
D) 10 units of X.

Question 9

Which of the following conditions makes it most likely for a quota to be imposed?

Accepted Answer

A) The benefits of the quota are spread over many and the costs are concentrated on a few. 
B) The benefits of the quota are spread over many and the costs are spread over many. 
C) The benefits of the quota are spread over few and the costs are spread over many. 
D) The benefits of the quota are spread over few and the costs are spread over few. 
E) There is not enough information to answer the question. 
A) The benefits of the quota are spread over many and the costs are concentrated on a few. 
B) The benefits of the quota are spread over many and the costs are spread over many. 
C) The benefits of the quota are spread over few and the costs are spread over many. 
D) The benefits of the quota are spread over few and the costs are spread over few. 
E) There is not enough information to answer the question.

Question 10

Alexander Hamilton used the infant-industry argument to support trade restrictions.

Accepted Answer

A) True 
 B)False

Question 11

Exhibit 33-9
​
  
-Refer to Exhibit 33-9. For country Y, the opportunity cost of producing one unit of good A is __________ unit(s) of good B.

Accepted Answer

A) 1.5 
B) 2 
C) 1/2 
D) 2/3 
E) 10 
A) 1.5 
B) 2 
C) 1/2 
D) 2/3 
E) 10

Question 12

If a U.S. company operates within a competitive environment and chooses to offshore part of its production process, the resulting change in the firm's costs should shift the ______________ curve for its product ___________________, thus _____________ the price of the product being produced.

Accepted Answer

A) supply; leftward; lowering 
B) supply; rightward; raising 
C) demand rightward; raising 
D) supply; rightward; lowering 
A) supply; leftward; lowering 
B) supply; rightward; raising 
C) demand rightward; raising 
D) supply; rightward; lowering

Question 13

Exhibit 33-6
​
  
-Refer to Exhibit 33-6. The opportunity cost of 1 unit of cheese in terms of units of wine is __________ for country B.

Accepted Answer

A) 1 
B) 5 
C) 10 
D) 15 
A) 1 
B) 5 
C) 10 
D) 15

Question 14

The answer is: "A tax on imports." What is the question?

Accepted Answer

A) What is comparative advantage? 
B) What is a quota? 
C) What is a tariff? 
D) What reduces consumers' surplus? 
E) c and d 
A) What is comparative advantage? 
B) What is a quota? 
C) What is a tariff? 
D) What reduces consumers' surplus? 
E) c and d

Question 15

The answer is: "The difference between the price buyers pay for a good and the maximum or highest price they would have paid for the good." This is the definition for

Accepted Answer

A) taxes. 
B) producers' surplus. 
C) consumers' surplus. 
D) the sum of producers' and consumers' surpluses. 
E) the welfare triangle. 
A) taxes. 
B) producers' surplus. 
C) consumers' surplus. 
D) the sum of producers' and consumers' surpluses. 
E) the welfare triangle.

Question 16

Smith argues that American producers cannot compete with foreign producers because wages are lower in foreign countries than in the United States. Smith is

Accepted Answer

A) advancing the foreign export subsidies argument for protectionism. 
B) making the mistake of believing that high wages mean high costs. 
C) advancing the antidumping argument for protectionism. 
D) making the mistake of believing that productivity is higher in foreign countries than in the United States. 
E) none of the above 
A) advancing the foreign export subsidies argument for protectionism. 
B) making the mistake of believing that high wages mean high costs. 
C) advancing the antidumping argument for protectionism. 
D) making the mistake of believing that productivity is higher in foreign countries than in the United States. 
E) none of the above

Question 17

Dumping occurs when a firm sells goods abroad at a price below their cost and below the price charged in their domestic market.

Accepted Answer

A) True 
 B)False

Question 18

As a result of a quota, both consumers' surplus and producers' surplus fall.

Accepted Answer

A) True 
 B)False

Question 19

A tariff is imposed on strawberries. The tariff will ___________ the price of strawberries in the domestic market, _____________ the quantity of strawberries imported in the domestic market, and ____________ consumers' surplus.

Accepted Answer

A) raise; lower; lower 
B) lower; raise; lower 
C) raise; lower; raise 
D) lower; lower; raise 
A) raise; lower; lower 
B) lower; raise; lower 
C) raise; lower; raise 
D) lower; lower; raise

Question 20

Consumers receive more consumers' surplus when tariffs exist than when they do not exist.

Accepted Answer

A) True 
 B)False

Exam 33: International Trade

Exhibit 33-1 ​ -Refer to Exhibit 33-1. Country B is the lower opportunity cost producer of

Major U.S. exports include automobiles and aircraft.

Two major exports for the United States are

Exhibit 33-10 -Refer to Exhibit 33-10. Who has the comparative advantage when it comes to mowing lawns?

Exhibit 33-6 ​ -Refer to Exhibit 33-6. Which of the following terms of trade would both countries agree on?

Exhibit 33-3 ​ -Refer to Exhibit 33-3. The world price is PW. If a tariff is imposed, the price rises to PW + T. Because of the tariff, government collects tariff revenues equal to the area of

Exhibit 33-1 ​ -Refer to Exhibit 33-1. The opportunity cost of one unit of Y in country A is

Which of the following conditions makes it most likely for a quota to be imposed?

Alexander Hamilton used the infant-industry argument to support trade restrictions.

Exhibit 33-9 ​ -Refer to Exhibit 33-9. For country Y, the opportunity cost of producing one unit of good A is __________ unit(s) of good B.

If a U.S. company operates within a competitive environment and chooses to offshore part of its production process, the resulting change in the firm's costs should shift the ______________ curve for its product ___________________, thus _____________ the price of the product being produced.

Exhibit 33-6 ​ -Refer to Exhibit 33-6. The opportunity cost of 1 unit of cheese in terms of units of wine is __________ for country B.

The answer is: "A tax on imports." What is the question?

The answer is: "The difference between the price buyers pay for a good and the maximum or highest price they would have paid for the good." This is the definition for

Smith argues that American producers cannot compete with foreign producers because wages are lower in foreign countries than in the United States. Smith is

Dumping occurs when a firm sells goods abroad at a price below their cost and below the price charged in their domestic market.

As a result of a quota, both consumers' surplus and producers' surplus fall.

A tariff is imposed on strawberries. The tariff will ___________ the price of strawberries in the domestic market, _____________ the quantity of strawberries imported in the domestic market, and ____________ consumers' surplus.

Consumers receive more consumers' surplus when tariffs exist than when they do not exist.

What Economics Is About

Production Possibilities Frontier Framework

Supply and Demand Theory

Prices Free Controlled and Relative

Supply Demand and Price Applications

Macroeconomic Measurements Part I Prices and Unemployment

Macroeconomic Measurements Part II Gdp and Real Gdp

Aggregate Demand and Aggregate Supply

Classical Macroeconomics and the Self Regulating Economy

Keynesian Macroeconomics and Economic Instability a Critique of the Self Regulating Economy

Fiscal Policy and the Federal Budget

Money Banking and the Financial System

The Federal Reserve System

Money and the Economy

Monetary Policy

Expectations Theory and the Economy

Economic Growth Resources Technology Ideas and Institutions

Debates in Macroeconomics Over the Role and Effects of Government

Elasticity

Consumer Choice and Behavioral Economics

Production and Costs

Perfect Competition

Monopoly

Monopolistic Competition Oligopoly and Game Theory

Government and Product Markets Antitrust and Regulation

Factor Markets With Emphasis on the Labor Market

Wages Unions and Labor

The Distribution of Income and Poverty

Interest Rent and Profit

Market Failure Externalities Public Goods and Asymmetric Information

Public Choice and Special Interest Group Politics

Building Theories to Explain Everyday Life From Observations to Questions to Theories to Predictions

International Finance

The Economic Case for and Against Government Five Topics Considered

Stocks Bonds Futures and Options

Filters

Exhibit 33-1 -Refer to Exhibit 33-1. Country B is the lower opportunity cost producer of

Exhibit 33-6 -Refer to Exhibit 33-6. Which of the following terms of trade would both countries agree on?

Exhibit 33-3 -Refer to Exhibit 33-3. The world price is P_W. If a tariff is imposed, the price rises to P_W + T. Because of the tariff, government collects tariff revenues equal to the area of

Exhibit 33-1 -Refer to Exhibit 33-1. The opportunity cost of one unit of Y in country A is

Exhibit 33-9 -Refer to Exhibit 33-9. For country Y, the opportunity cost of producing one unit of good A is __________ unit(s) of good B.

If a U.S. company operates within a competitive environment and chooses to offshore part of its production process, the resulting change in the firm's costs should shift the ____ curve for its product _, thus _____ the price of the product being produced.

Exhibit 33-6 -Refer to Exhibit 33-6. The opportunity cost of 1 unit of cheese in terms of units of wine is __________ for country B.

A tariff is imposed on strawberries. The tariff will _____ the price of strawberries in the domestic market, _ the quantity of strawberries imported in the domestic market, and ______ consumers' surplus.