Exam 20: International Trade

The accompanying table gives domestic supply and demand schedules for a product. Suppose that the world price of the product is $1. Quantity Supplied (Domestic) Price Quantity Demanded (Domestic) 12 \ 5 2 10 4 4 7 3 7 4 2 11 1 1 16 With a $1-per-unit tariff, the quantities sold by foreign and domestic producers, respectively, will be

Assume that a VER (voluntary export restraint) is imposed on an imported product. The difference between the domestic price and the world price is captured by

Assume that by devoting all its resources to the production of X, nation Alpha can produce 20 units of X. By devoting all its resources to Y, Alpha can produce 30Y. Comparable figures for nation Beta are 60X and 40Y. There is no basis for trade between Alpha and Beta, because Beta has an absolute advantage in the production of both goods.

Nation Alpha has a comparative advantage in product X, and nation Beta has a comparative advantage in product Y. Trade in the two products will only benefit the two nations if

Which of the following is a valid counterargument against using tariffs to protect high wages from cheap foreign labor?

If a nation's labor can produce more of a good compared to labor in another nation, then we say that the first nation has a comparative advantage in producing that good.

Refer to the diagram pertaining to two nations and a specific product. Lines FA and GB are

What other economic process needs to accompany international trade, for nations to benefit from such trade?

In Germany, one worker can produce either one cuckoo clock or one beer mug. In Taiwan, one worker can produce either two cuckoo clocks or three beer mugs. Who has the comparative Advantage in each good?

A nation will import a particular product if the world price is less than the domestic price.

The graph shows the production possibilities curves for two hypothetical nations, Orin and Pohl, which each make two hypothetical products, jaxs and keps. Which of the following statements is Correct?

Suppose the United States sets a limit on the number of tons of sugar that can be imported each year. This is an example of a(n)

The tables give production possibilities data for two countries, Alpha and Beta, which have populations of equal size. ${ \text { Alpha's production possibilities } }$ A B C D E Fish (Tons) 80 60 40 20 0 Chips (Tons) 0 5 10 15 20 Beta's production possibilities A B C D E Fish (Tons) 240 180 120 60 0 Chips (Tons) 0 10 20 30 40 Suppose that before specialization and trade, Alpha chose production alternative C and Beta chose Production alternative B. After specialization and trade, the gains will be

A major goal of the World Trade Organization is to

Common arguments often raised to present the case for protectionism include the following, except

Suppose the domestic price (no-international-trade price) of copper is $1.20 a pound in the United States while the world price is $1.00 a pound. Assuming no transportation costs, the United States Will

Specialization and trade based on comparative advantage allow nations to attain the following results, except

How will the difference between the world price and the domestic price of a good encourage exports and imports?

Trade protection in most instances transfers wealth from consumers to domestic producers and government.