Question 1

If a country is exporting a good, this is because the country has an absolute advantage in the production of that good.
​

Accepted Answer

A) True 
 B)False

Question 2

Figure 9-4  
-Refer to Figure 9-4. The country for which the figure is drawn

Accepted Answer

A) has a comparative advantage relative to other countries in the production of crude oil and it will export crude oil. 
B) has a comparative advantage relative to other countries in the production of crude oil and it will import crude oil. 
C) has a comparative disadvantage relative to other countries in the production of crude oil and it will export crude oil. 
D) has a comparative disadvantage relative to other countries in the production of crude oil and it will import crude oil. 
A) has a comparative advantage relative to other countries in the production of crude oil and it will export crude oil. 
B) has a comparative advantage relative to other countries in the production of crude oil and it will import crude oil. 
C) has a comparative disadvantage relative to other countries in the production of crude oil and it will export crude oil. 
D) has a comparative disadvantage relative to other countries in the production of crude oil and it will import crude oil.

Question 3

Tariffs cause deadweight loss because they move the price of an imported product closer to the equilibrium without trade, thus reducing the gains from trade.

Accepted Answer

A) True 
 B)False

Question 4

What is the fundamental basis for trade among nations?

Accepted Answer

A) Shortages or surpluses in nations that do not trade 
B) Misguided economic policies 
C) Absolute advantage 
D) Comparative advantage 
A) Shortages or surpluses in nations that do not trade 
B) Misguided economic policies 
C) Absolute advantage 
D) Comparative advantage

Question 5

The infant-industry argument

Accepted Answer

A) is based on the belief that protecting industries when they are young will pay off later. 
B) is based on the belief that protecting industries producing goods and services for infants is necessary if a country is to have healthy children. 
C) has the support of most economists. 
D) is an argument that is advanced by advocates of free trade. 
A) is based on the belief that protecting industries when they are young will pay off later. 
B) is based on the belief that protecting industries producing goods and services for infants is necessary if a country is to have healthy children. 
C) has the support of most economists. 
D) is an argument that is advanced by advocates of free trade.

Question 6

Figure 9-4  
-Refer to Figure 9-4. Consumer surplus in this market before trade is

Accepted Answer

A) A. 
B) A + B. 
C) A + B + D. 
D) C. 
A) A. 
B) A + B. 
C) A + B + D. 
D) C.

Question 7

Figure 9-8
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 9-8. If the country allows free trade, how much are consumer surplus, producer surplus, and total surplus with trade?

Accepted Answer

With trade, consumer

Question 8

The "unfair-competition" argument might be cited by an American who believes that

Accepted Answer

A) almost every country has a comparative advantage, relative to the United States, in producing almost all goods. 
B) young industries should be protected against foreign competition until they become profitable. 
C) the American automobile industry should be protected against Japanese firms that are able to produce automobiles at relatively low cost. 
D) the French government's subsidies to French farmers justify restrictions on American imports of French agricultural products. 
A) almost every country has a comparative advantage, relative to the United States, in producing almost all goods. 
B) young industries should be protected against foreign competition until they become profitable. 
C) the American automobile industry should be protected against Japanese firms that are able to produce automobiles at relatively low cost. 
D) the French government's subsidies to French farmers justify restrictions on American imports of French agricultural products.

Question 9

Figure 9-7
The following diagram shows the domestic demand and domestic supply curves in a market.   ​
-Refer to Figure 9-7. With no trade allowed, what are the equilibrium price and equilibrium quantity in this market?

Accepted Answer

The equilibrium pric

Question 10

Figure 9-10
The following diagram shows the domestic demand and domestic supply curves in a market. Assume that the world price in this market is $1 per unit.   ​
-Refer to Figure 9-10. Suppose the country imposes a $1 per unit tariff. If the country allows trade with a tariff, what will be the domestic price in this market?

Accepted Answer

With trade and a tar

Question 11

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 12

Scenario 9-1
​
For a small country called Boxland, the equation of the domestic demand curve for cardboard is QS1U1P1DS1S1P0 = 210 − 2P, where QS1U1P1DS1S1P0 represents the domestic quantity of cardboard demanded, in tons, and P represents the price of a ton of cardboard. For Boxland, the equation of the domestic supply curve for cardboard is QS1U1P1SS1S1P0 = -90 + 3P, where QS1U1P1SS1S1P0 represents the domestic quantity of cardboard supplied, in tons, and P again represents the price of a ton of cardboard.
-Refer to Scenario 9-1. If Boxland prohibits international trade in cardboard, then the equilibrium price of a ton of cardboard is

Accepted Answer

A) $47 and the equilibrium quantity of cardboard is 116 tons. 
B) $53 and the equilibrium quantity of cardboard is 104 tons. 
C) $60 and the equilibrium quantity of cardboard is 90 tons. 
D) $82 and the equilibrium quantity of cardboard is 46 tons. 
A) $47 and the equilibrium quantity of cardboard is 116 tons. 
B) $53 and the equilibrium quantity of cardboard is 104 tons. 
C) $60 and the equilibrium quantity of cardboard is 90 tons. 
D) $82 and the equilibrium quantity of cardboard is 46 tons.

Question 13

Figure 9-3  
-Refer to Figure 9-3. Before the tariff is imposed, this country

Accepted Answer

A) imports 200 roses. 
B) imports 400 roses. 
C) exports 200 roses. 
D) exports 400 roses. 
A) imports 200 roses. 
B) imports 400 roses. 
C) exports 200 roses. 
D) exports 400 roses.

Question 14

Figure 9-10
The following diagram shows the domestic demand and domestic supply curves in a market. Assume that the world price in this market is $1 per unit.   ​
-Refer to Figure 9-10. If the country allows free trade, will the country import or export this good, and how many units will be imported/exported?

Accepted Answer

With trade

Exam 9: Application: International Trade

If a country is exporting a good, this is because the country has an absolute advantage in the production of that good. ​

Figure 9-4 -Refer to Figure 9-4. The country for which the figure is drawn

Tariffs cause deadweight loss because they move the price of an imported product closer to the equilibrium without trade, thus reducing the gains from trade.

What is the fundamental basis for trade among nations?

The infant-industry argument

Figure 9-4 -Refer to Figure 9-4. Consumer surplus in this market before trade is

Figure 9-8 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 9-8. If the country allows free trade, how much are consumer surplus, producer surplus, and total surplus with trade?

The "unfair-competition" argument might be cited by an American who believes that

Figure 9-7 The following diagram shows the domestic demand and domestic supply curves in a market. ​ -Refer to Figure 9-7. With no trade allowed, what are the equilibrium price and equilibrium quantity in this market?

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

Figure 9-3 -Refer to Figure 9-3. Before the tariff is imposed, this country

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

Applications: 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

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

Tools of Finance

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

Filters

If a country is exporting a good, this is because the country has an absolute advantage in the production of that good.

Figure 9-8 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 9-8. If the country allows free trade, how much are consumer surplus, producer surplus, and total surplus with trade?

Figure 9-7 The following diagram shows the domestic demand and domestic supply curves in a market. -Refer to Figure 9-7. With no trade allowed, what are the equilibrium price and equilibrium quantity in this market?