Question 1

What are the major imports and exports of the United States?

Accepted Answer

The major imports of the U.S. include pe

Question 2

$$\begin{array}{l}
{ ~~~~~~~~~~~~~~~~~~~~~\text { Wat's Production Possibilities } }\
\begin{array} { | l | c | c | c | c | c | c | } 
\hline \text { Product } & A & B & C & D & E & F \
\hline \text { Rice } & 750 & 600 & 450 & 300 & 150 & 0 \
\hline \text { Corn } & 0 & 50 & 100 & 150 & 200 & 250 \
\hline
\end{array}\\
{ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~\text { Xat's Production Possibilities } }\
\begin{array} { | l | c | c | c | c | c | c | } 
\hline \text { Product } & A & B & C & D & E & F \
\hline \text { Rice } & 2,500 & 2,000 & 1,500 & 1,000 & 500 & 0 \
\hline \text { Corn } & 0 & 100 & 200 & 300 & 400 & 500 \
\hline
\end{array}
\end{array}$$ The hypothetical nations Wat and Xat have the production possibilities for rice and corn given in the accompanying tables. Which of the following statements about the two nations is correct based on
The principle of comparative advantage?

Accepted Answer

A)  Xat should specialize in the production of corn. 
B)  Wat should specialize in the production of rice. 
C)  Xat has a comparative advantage in the production of rice. 
D)  Xat has a comparative advantage in the production of corn. 
A)  Xat should specialize in the production of corn. 
B)  Wat should specialize in the production of rice. 
C)  Xat has a comparative advantage in the production of rice. 
D)  Xat has a comparative advantage in the production of corn.

Question 3

The accompanying table gives domestic supply and demand schedules for a product. Suppose that the world price of the product is $1.
$$\begin{array} { | c | c | c | } 
\hline \begin{array} { c } 
\text { Quantity } \
\text { Supplied } \
\text { (Domestic) }
\end{array} & \text { Price } & \begin{array} { c } 
\text { Quantity } \
\text { Demanded } \
\text { (Domestic) }
\end{array} \
\hline 12 & \$ 5 & 2 \
\hline 10 & 4 & 4 \
\hline 7 & 3 & 7 \
\hline 4 & 2 & 11 \
\hline 1 & 1 & 16 \
\hline
\end{array}$$ If the economy was opened to free trade and the world price of $1 prevailed, the price and quantity
Sold of this product would be

Accepted Answer

A)  $1 and 1 unit. 
B)  $1 and 16 units. 
C)  $3 and 7 units. 
D)  $2 and 11 units. 
A)  $1 and 1 unit. 
B)  $1 and 16 units. 
C)  $3 and 7 units. 
D)  $2 and 11 units.

Question 4

The accompanying table gives domestic supply and demand schedules for a product. Suppose that the world price of the product is $1.
$$\begin{array} { | c | c | c | } 
\hline \begin{array} { c } 
\text { Quantity } \
\text { Supplied } \
\text { (Domestic) }
\end{array} & \text { Price } & \begin{array} { c } 
\text { Quantity } \
\text { Demanded } \
\text { (Domestic) }
\end{array} \
\hline 12 & \$ 5 & 2 \
\hline 10 & 4 & 4 \
\hline 7 & 3 & 7 \
\hline 4 & 2 & 11 \
\hline 1 & 1 & 16 \
\hline
\end{array}$$ With a $1-per-unit tariff, prices (revenue per unit) received by domestic and foreign producers
Respectively will be

Accepted Answer

A)  $2 and $1. 
B)  $1 and $2. 
C)  $2 and $2. 
D)  $3 and $2. 
A)  $2 and $1. 
B)  $1 and $2. 
C)  $2 and $2. 
D)  $3 and $2.

Question 5

Which nation had the largest share of world exports in 2018?

Accepted Answer

A)  Japan 
B)  Germany 
C)  China 
D)  United States 
A)  Japan 
B)  Germany 
C)  China 
D)  United States

Question 6

$$\begin{array} { | c | c | c | } 
\hline \begin{array} { c } 
\text { Quantity Demanded } \
\text { Domestically }
\end{array} & \text { Price } & \begin{array} { c } 
\text { Quantity Supplied } \
\text { Domestically }
\end{array} \
\hline 1,400 & \$ 10 & 2,200 \
\hline 1,600 & 9 & 2,000 \
\hline 1,800 & 8 & 1,800 \
\hline 2,000 & 7 & 1,600 \
\hline 2,200 & 6 & 1,400 \
\hline 2,400 & 5 & 1,200 \
\hline
\end{array}$$ Refer to the accompanying table for a certain product's market in Econland. If the world price for this product were $6, then Econland would import

Accepted Answer

A)  400 units and domestic producers would supply 1,400. 
B)  800 units and domestic producers would supply 1,400. 
C)  800 units and domestic producers would supply 2,200. 
D)  400 units and domestic producers would supply 2,200. 
A)  400 units and domestic producers would supply 1,400. 
B)  800 units and domestic producers would supply 1,400. 
C)  800 units and domestic producers would supply 2,200. 
D)  400 units and domestic producers would supply 2,200.

Question 7

$$\begin{array}{l}
{ ~~~~~~~~~~~~~~~~~~~~~\text { Wat's Production Possibilities } }\
\begin{array} { | l | c | c | c | c | c | c | } 
\hline \text { Product } & A & B & C & D & E & F \
\hline \text { Rice } & 750 & 600 & 450 & 300 & 150 & 0 \
\hline \text { Corn } & 0 & 50 & 100 & 150 & 200 & 250 \
\hline
\end{array}\\
{ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~\text { Xat's Production Possibilities } }\
\begin{array} { | l | c | c | c | c | c | c | } 
\hline \text { Product } & A & B & C & D & E & F \
\hline \text { Rice } & 2,500 & 2,000 & 1,500 & 1,000 & 500 & 0 \
\hline \text { Corn } & 0 & 100 & 200 & 300 & 400 & 500 \
\hline
\end{array}
\end{array}$$ The hypothetical nations Wat and Xat have the production possibilities for rice and corn given in the accompanying tables. The mutually bene?cial terms of trade will be

Accepted Answer

A)  less than 2 units of rice for 1 unit of corn. 
B)  greater than 4 units of rice for 1 unit of corn. 
C)  between 3 and 5 units of corn for 1 unit of rice. 
D)  between 3 and 5 units of rice for 1 unit of corn. 
A)  less than 2 units of rice for 1 unit of corn. 
B)  greater than 4 units of rice for 1 unit of corn. 
C)  between 3 and 5 units of corn for 1 unit of rice. 
D)  between 3 and 5 units of rice for 1 unit of corn.

Question 8

Country A limits other nation's exports to Country A to 1,000 tons of coal annually. This is an example of a(n)

Accepted Answer

A)  protective tariff. 
B)  export subsidy. 
C)  import quota. 
D)  voluntary export restriction. 
A)  protective tariff. 
B)  export subsidy. 
C)  import quota. 
D)  voluntary export restriction.

Question 9

If countries A and B produce only either rubber bands or paper clips, their maximum outputs are shown in the accompanying production possibilities schedules.
$$\begin{array} { | c | c | c | } 
\hline \text { Country } & \text { Rubber Bands } & \text { Paper Clips } \
\hline A & 40 & 80 \
\hline B & 10 & 40 \
\hline
\end{array}$$ In country A the opportunity cost of 1 paper clip is

Accepted Answer

A)  2 rubber bands. 
B)  1 rubber band. 
C)  $1 / 2$ 1/2 rubber band. 
D)  $1 / 4$ 1/4 rubber band. 
A)  2 rubber bands. 
B)  1 rubber band. 
C)  $1 / 2$ 1/2 rubber band. 
D)  $1 / 4$ 1/4 rubber band.

Question 10

In 2018, the United States was the largest exporter in the world.

Accepted Answer

A) True 
 B)False

Question 11

When a nation starts opening up to international trade, it will see falling prices for

Accepted Answer

A)  goods that it exports. 
B)  goods that it imports. 
C)  goods that it has a comparative advantage in. 
D)  all goods traded. 
A)  goods that it exports. 
B)  goods that it imports. 
C)  goods that it has a comparative advantage in. 
D)  all goods traded.

Question 12

The greatest beneﬁt to an economy from international trade is

Accepted Answer

A)  greater employment in the export sector of the economy. 
B)  the economic power it gives a nation over other countries. 
C)  full employment of its labor force. 
D)  consumption beyond domestic production possibilities. 
A)  greater employment in the export sector of the economy. 
B)  the economic power it gives a nation over other countries. 
C)  full employment of its labor force. 
D)  consumption beyond domestic production possibilities.

Question 13

In which of the following countries did exports account for the biggest percentage of GDP in 2018?

Accepted Answer

A)  Japan 
B)  United States 
C)  Netherlands 
D)  Germany 
A)  Japan 
B)  United States 
C)  Netherlands 
D)  Germany

Question 14

Refer to the graph, which shows the domestic demand and supply curves for a speciﬁc product in a hypothetical nation called Econland. If the world price for this product is $2.00, then Econland will

Accepted Answer

A)  export 200 units. 
B)  export 400 units. 
C)  import 200 units. 
D)  import 400 units. 
A)  export 200 units. 
B)  export 400 units. 
C)  import 200 units. 
D)  import 400 units.

Question 15

The accompanying table gives domestic supply and demand schedules for a product. Suppose that the world price of the product is $1.
$$\begin{array} { | c | c | c | } 
\hline \begin{array} { c } 
\text { Quantity } \
\text { Supplied } \
\text { (Domestic) }
\end{array} & \text { Price } & \begin{array} { c } 
\text { Quantity } \
\text { Demanded } \
\text { (Domestic) }
\end{array} \
\hline 12 & \$ 5 & 2 \
\hline 10 & 4 & 4 \
\hline 7 & 3 & 7 \
\hline 4 & 2 & 11 \
\hline 1 & 1 & 16 \
\hline
\end{array}$$ If this nation were entirely closed to international trade, equilibrium price and quantity would be

Accepted Answer

A)  $5 and 2 units. 
B)  $1 and 1 unit. 
C)  $4 and 4 units. 
D)  $3 and 7 units. 
A)  $5 and 2 units. 
B)  $1 and 1 unit. 
C)  $4 and 4 units. 
D)  $3 and 7 units.

Question 16

Which of the U.S. industries below has not seen major shutdowns and layoffs because of free foreign trade?

Accepted Answer

A)  textiles 
B)  accounting services 
C)  steel 
D)  apparel 
A)  textiles 
B)  accounting services 
C)  steel 
D)  apparel

Question 17

Bastiat's "Petition of the Candlemakers," a classic reading in economics, presents a powerful
argument in favor of protectionism.

Accepted Answer

A) True 
 B)False

Question 18

$ \quad\quad { Country ~Y } $
$\begin{array} { | c | c | c | } 
\hline Price & Q _ { \text {dd } } & Q _ { \text {sd } } \
\hline \$ 9.00 & 250 & 450 \
\hline 8.00 & 300 & 400 \
\hline 7.00 & 350 & 350 \
\hline 6.00 & 400 & 300 \
\hline
\end{array}$
The accompanying table gives data for Country Y. Column 1 is the price of a product. Column 2 is the quantity demanded domestically $\left( Q _ { d d } \right)$, and Column 3 is the quantity supplied domestically $\left( Q _ { s d } \right)$. If the world price of the product is $\$ 6$, then Country $Y$ will

Accepted Answer

A)  export 100 units of the product 
B)  import 100 units of the product. 
C)  export 300 units of the product. 
D)  import 400 units of the product. 
A)  export 100 units of the product 
B)  import 100 units of the product. 
C)  export 300 units of the product. 
D)  import 400 units of the product.

Question 19

Specialization and trade between individuals or between nations leads to

Accepted Answer

A)  greater self-suﬃciency. 
B)  higher product prices. 
C)  higher utilization of resources. 
D)  higher total output. 
A)  greater self-suﬃciency. 
B)  higher product prices. 
C)  higher utilization of resources. 
D)  higher total output.

Question 20

A side beneﬁt of international trade is that it links national interests and increases the opportunity
costs of war.

Accepted Answer

A) True 
 B)False

What are the major imports and exports of the United States?

Which nation had the largest share of world exports in 2018?

Country A limits other nation's exports to Country A to 1,000 tons of coal annually. This is an example of a(n)

If countries A and B produce only either rubber bands or paper clips, their maximum outputs are shown in the accompanying production possibilities schedules. Country Rubber Bands Paper Clips A 40 80 B 10 40 In country A the opportunity cost of 1 paper clip is

In 2018, the United States was the largest exporter in the world.

When a nation starts opening up to international trade, it will see falling prices for

The greatest beneﬁt to an economy from international trade is

In which of the following countries did exports account for the biggest percentage of GDP in 2018?

Refer to the graph, which shows the domestic demand and supply curves for a speciﬁc product in a hypothetical nation called Econland. If the world price for this product is $2.00, then Econland will

Which of the U.S. industries below has not seen major shutdowns and layoffs because of free foreign trade?

Bastiat's "Petition of the Candlemakers," a classic reading in economics, presents a powerful argument in favor of protectionism.

Specialization and trade between individuals or between nations leads to

A side beneﬁt of international trade is that it links national interests and increases the opportunity costs of war.

The Market System and the Circular Flow

Demand, Supply, and Market Equilibrium

Market Failures Caused by Externalities Asymmetric Information

Public Goods, Public Choice, and Government Failure

An Introduction to Macroeconomics

Measuring Domestic Output and National Income

Economic Growth

Business Cycles, Unemployment, and Inflation

Basic Macroeconomic Relationships

The Aggregate Expenditures Model

Aggregate Demand and Aggregate Supply

Fiscal Policy, Deficits, and Debt

Money, Banking, and Financial Institutions

Money Creation

Interest Rates and Monetary Policy

Financial Economics

Extending the Analysis of Aggregate Supply

Current Issues in Macro Theory and Policy

The Balance of Payments, Exchange Rates, and Trade Deficits

The Economics of Developing Countries

Filters

Exam 20: International Trade

What are the major imports and exports of the United States?

Which nation had the largest share of world exports in 2018?

Country A limits other nation's exports to Country A to 1,000 tons of coal annually. This is an example of a(n)

If countries A and B produce only either rubber bands or paper clips, their maximum outputs are shown in the accompanying production possibilities schedules. Country Rubber Bands Paper Clips A 40 80 B 10 40 In country A the opportunity cost of 1 paper clip is

In 2018, the United States was the largest exporter in the world.

When a nation starts opening up to international trade, it will see falling prices for

The greatest beneﬁt to an economy from international trade is

In which of the following countries did exports account for the biggest percentage of GDP in 2018?

Refer to the graph, which shows the domestic demand and supply curves for a speciﬁc product in a hypothetical nation called Econland. If the world price for this product is $2.00, then Econland will

Which of the U.S. industries below has not seen major shutdowns and layoffs because of free foreign trade?

Bastiat's "Petition of the Candlemakers," a classic reading in economics, presents a powerful argument in favor of protectionism.

Specialization and trade between individuals or between nations leads to

A side beneﬁt of international trade is that it links national interests and increases the opportunity costs of war.

The Market System and the Circular Flow

Demand, Supply, and Market Equilibrium

Market Failures Caused by Externalities Asymmetric Information

Public Goods, Public Choice, and Government Failure

An Introduction to Macroeconomics

Measuring Domestic Output and National Income

Economic Growth

Business Cycles, Unemployment, and Inflation

Basic Macroeconomic Relationships

The Aggregate Expenditures Model

Aggregate Demand and Aggregate Supply

Fiscal Policy, Deficits, and Debt

Money, Banking, and Financial Institutions

Money Creation

Interest Rates and Monetary Policy

Financial Economics

Extending the Analysis of Aggregate Supply

Current Issues in Macro Theory and Policy

The Balance of Payments, Exchange Rates, and Trade Deficits

The Economics of Developing Countries

Filters