Exam 14: Macroeconomics and International Trade

Comparative advantage and international trade are driven by ________.

The table below shows the quantities of rice and wheat that two countries can produce in a year if they specialize in the production of each good. -Refer to the table above.The opportunity cost of producing 1 ton of wheat in Country X is ________.

Scenario: Consider two economies, Beta and Zeta. Each farmer in Beta can grow 1,000 pounds of apples or 500 pounds of oranges in a year. Each farmer in Zeta can grow 400 pounds of apples or 1,200 pounds of oranges in a year. -Refer to the scenario above.The opportunity cost of producing 1 pound of apples in Zeta is ________.

A producer is said to have an absolute advantage in the production of a good when the producer ________ compared to other producers.

To qualify as foreign direct investment,the capital flow must generate a large ownership stake in a local firm for foreign investors.

Factor payments to foreigners represent remittances from domestic residents to foreigners.

Domestic residents can receive income-based payments in which of the following forms?

A U.S.company buying toys manufactured in China is an example of a(n)________.

Which of the following is likely to happen if the government imposes a tariff on steel imports?

Scenario: Mark can make three tables and one chair in a day, while John can make four tables and one chair in a day. -Refer to the scenario above.Which of the following is true in this case?

Scenario: Consider two economies, Beta and Zeta. Each farmer in Beta can grow 1,000 pounds of apples or 500 pounds of oranges in a year. Each farmer in Zeta can grow 400 pounds of apples or 1,200 pounds of oranges in a year. -Refer to the scenario above.The opportunity cost of producing 1 pound of apples in Beta is ________.

Scenario: A shoe manufacturer has factories in two countries, Country X and Country Y. Shoe manufacturing involves two main tasks-designing the shoe and stitching it. The value added per hour in each activity by workers in the two countries is shown in the table below. -Refer to the scenario above.Which of the following statements is true in this case?

Everything else equal,if a country has exports of $12 billion and imports of $10 billion,it follows that the country has a current account balance of ________ and a financial account balance of ________.

Scenario: Mike and John work as waiters in a restaurant. Mike can efficiently wait on ten customers per hour, while John can efficiently wait on seven customers per hour. The restaurant also has a bar. If both of them work as bartenders, Mike is able to serve nine customers per hour and John is able to serve ten customers per hour. -Refer to the scenario above.Which of the following statements is true in this case?

Assuming all else equal,if ________,net exports are positive.

There is ________ relationship between the real interest rate and net capital outflows.

What happens when a country runs a current account deficit?

A country has a current account deficit of −$100 billion.This implies that ________.

Does international trade benefit all the economic agents in a country when the country is opened to international trade? Explain your answer.

Which of the following is likely to reduce child labor in an economy?