Exam 34: International Trade and Comparative Advantage

What matters most in determining efficient distribution of production over the world is

The United States has relatively low tariffs.

Large gains from trade are most likely when countries are very different.

The two primary reasons to adopt measures to restrict trade are that

A quota is

"The United States has more oil in Alaska than there is oil in Kuwait.Therefore, the United States should stop importing oil." Evaluate this statement using economic analysis.

Comparative advantage is the ability to produce a good at a lower opportunity cost than another producer.

Dumping means selling goods in a foreign market at lower prices than those charged in the home market.

Figure 34-6 ​ -From the graph in Figure 34-6, the opportunity cost of a unit of bananas is

The following table shows the units of output a worker can produce per month in country A and country B. The opportunity cost of 1 unit of electronics in country A is

Opportunity cost refers to whatever is given up to obtain some item.

The logic of why international trade increases well-being is

Why does equilibrium in the market for a traded good not occur where that country's quantity demanded equals quantity supplied?

The strategic argument for protectionism holds that a nation may sometimes have to threaten protectionism to induce other countries to drop their own protectionist measures.

If the production possibilities curves of two countries have the same slope,

Gain from trade is the increase in total production due to specialization allowed by trade.

Figure 34-10 ​ -Figure 34-10 shows the effect on the market for disk drives of a(n)

Which of the following positions would a mercantilist support?

In William Safire's 1983 essay, "Smoot-Hawley Lives," he argues that the United States should

The U.S.Constitution prevents tariffs on trade between the individual states.