Question 1

Intra-industry trade will tend to dominate trade flows when which of the following exists?

Accepted Answer

A)  small differences between relative country factor availabilities 
B)  large differences between relative country factor availabilities 
C)  homogeneous products that cannot be differentiated 
D)  constant cost industries 
E)  uneven distribution of abundant resources between two countries 
A)  small differences between relative country factor availabilities 
B)  large differences between relative country factor availabilities 
C)  homogeneous products that cannot be differentiated 
D)  constant cost industries 
E)  uneven distribution of abundant resources between two countries A

Question 2

A firm in long-run equilibrium under monopolistic competition will earn

Accepted Answer

A)  zero economic profits because of free entry. 
B)  positive monopoly profits because each sells a differentiated product. 
C)  positive oligopoly profits because each firm sells a differentiated product. 
D)  negative economic profits because it has economies of scale. 
E)  positive economic profit if it engages in international trade. 
A)  zero economic profits because of free entry. 
B)  positive monopoly profits because each sells a differentiated product. 
C)  positive oligopoly profits because each firm sells a differentiated product. 
D)  negative economic profits because it has economies of scale. 
E)  positive economic profit if it engages in international trade. A

Question 3

A monopolistic firm

Accepted Answer

A)  will never sell a product whose demand is inelastic at the quantity sold. 
B)  can sell as much as it wants for any price it determines in the market. 
C)  cannot determine the price, which is determined by consumer demand. 
D)  cannot sell additional quantity unless it raises the price on each unit. 
E)  will always earn a profit in the long run. 
A)  will never sell a product whose demand is inelastic at the quantity sold. 
B)  can sell as much as it wants for any price it determines in the market. 
C)  cannot determine the price, which is determined by consumer demand. 
D)  cannot sell additional quantity unless it raises the price on each unit. 
E)  will always earn a profit in the long run. A

Question 4

During the past decade,U.S.imports of business services have ________,U.S.exports of business services have ________,and U.S.net exports of business services have ________.

Accepted Answer

A)  increased; increased; increased 
B)  increased; decreased; decreased 
C)  decreased; increased; increased 
D)  increased; increased; not changed 
E)  decreased; decreased; increased 
A)  increased; increased; increased 
B)  increased; decreased; decreased 
C)  decreased; increased; increased 
D)  increased; increased; not changed 
E)  decreased; decreased; increased

Question 5

-Refer to above figure.The monopolist can export as much as it likes of its steel at the world price of $5/ton.How much steel will the monopolist sell,and at what price?

Accepted Answer

It would s

Question 6

In the model of monopolistic competition,trade costs between countries cause

Accepted Answer

A)  some firms that can earn a profit on domestic sales to refrain from exporting their goods. 
B)  prices of goods sold domestically to exceed the prices of exported goods. 
C)  marginal costs of goods sold domestically to exceed the marginal costs of exported goods. 
D)  all firms that can earn a profit on domestic sales to export their goods at higher prices. 
E)  countries to negotiate the elimination of trade costs by mutual subsidization of trade. 
A)  some firms that can earn a profit on domestic sales to refrain from exporting their goods. 
B)  prices of goods sold domestically to exceed the prices of exported goods. 
C)  marginal costs of goods sold domestically to exceed the marginal costs of exported goods. 
D)  all firms that can earn a profit on domestic sales to export their goods at higher prices. 
E)  countries to negotiate the elimination of trade costs by mutual subsidization of trade.

Question 7

An imperfectly competitive firm has the following demand curve: Q = 100 - 2P.What is marginal revenue equal to when P = 40?

Accepted Answer

Q = 20,so

Question 8

-The figure above represents the demand and cost functions facing a Brazilian Steel producing monopolist.If it were unable to export,and was constrained by its domestic market,what quantity would it sell at what price?

Accepted Answer

It would sell 5 (mil

Question 9

We often observe "pseudo-intra-industry trade" between the United States and Mexico.Actually,such trade is consistent with

Accepted Answer

A)  comparative advantage associated with Heckscher-Ohlin model. 
B)  oligopolistic markets. 
C)  optimal tariff issues. 
D)  the Ricardian model of trade. 
E)  the specific factors model of trade. 
A)  comparative advantage associated with Heckscher-Ohlin model. 
B)  oligopolistic markets. 
C)  optimal tariff issues. 
D)  the Ricardian model of trade. 
E)  the specific factors model of trade.

Question 10

Intra-industry trade is most common in the trade patterns of

Accepted Answer

A)  the industrial countries of Western Europe. 
B)  the developing countries of Asia and Africa. 
C)  raw material producers. 
D)  China with the rest of the world. 
E)  labor-intensive products. 
A)  the industrial countries of Western Europe. 
B)  the developing countries of Asia and Africa. 
C)  raw material producers. 
D)  China with the rest of the world. 
E)  labor-intensive products.

Question 11

International trade based on external scale economies in both countries is likely to be carried out by

Accepted Answer

A)  a relatively large number of price competing firms. 
B)  a relatively small number of price competing firms. 
C)  a relatively small number of imperfect competitors. 
D)  monopolists in each country. 
E)  a large number of oligopolists in each country. 
A)  a relatively large number of price competing firms. 
B)  a relatively small number of price competing firms. 
C)  a relatively small number of imperfect competitors. 
D)  monopolists in each country. 
E)  a large number of oligopolists in each country.

Question 12

In the model of monopolistic competition,trade costs between countries cause

Accepted Answer

A)  marginal costs of exported goods to exceed the marginal costs of goods sold domestically. 
B)  marginal costs of goods sold domestically to exceed the marginal costs of exported goods. 
C)  all firms that can earn a profit on domestic sales to export their goods at lower prices. 
D)  all firms that can earn a profit on domestic sales to export their goods at higher prices. 
E)  countries to negotiate the elimination of trade costs by mutual subsidization of trade. 
A)  marginal costs of exported goods to exceed the marginal costs of goods sold domestically. 
B)  marginal costs of goods sold domestically to exceed the marginal costs of exported goods. 
C)  all firms that can earn a profit on domestic sales to export their goods at lower prices. 
D)  all firms that can earn a profit on domestic sales to export their goods at higher prices. 
E)  countries to negotiate the elimination of trade costs by mutual subsidization of trade.

Question 13

An industry is characterized by scale economies,and exists in two countries.Should these two countries engage in trade such that the combined market is supplied by one country's industry,then

Accepted Answer

A)  consumers in both countries would have more varieties and lower prices. 
B)  consumers in both countries would have higher prices and fewer varieties. 
C)  consumers in the importing country only would have higher prices and fewer varieties. 
D)  consumers in the exporting country only would have higher prices and fewer varieties. 
E)  consumers in both countries would have fewer varieties at lower prices. 
A)  consumers in both countries would have more varieties and lower prices. 
B)  consumers in both countries would have higher prices and fewer varieties. 
C)  consumers in the importing country only would have higher prices and fewer varieties. 
D)  consumers in the exporting country only would have higher prices and fewer varieties. 
E)  consumers in both countries would have fewer varieties at lower prices.

Question 14

In the model of monopolistic competition,an increase in industry output will ________ producers of ________ higher-priced goods and ________ producers of lower-priced goods.

Accepted Answer

A)  harm; benefit 
B)  benefit; harm 
C)  harm; harm 
D)  benefit; benefit 
E)  benefit; have no effect on 
A)  harm; benefit 
B)  benefit; harm 
C)  harm; harm 
D)  benefit; benefit 
E)  benefit; have no effect on

Question 15

A product is produced in a monopolistically competitive industry with scale economies.If this industry exists in two countries,and these two countries engage in trade with each other,then we would expect

Accepted Answer

A)  each country will export different varieties of the product to the other. 
B)  the country in which the price of the product is lower will export the product. 
C)  the country with a relative abundance of the factor of production in which production of the product is intensive will export this product. 
D)  neither country will export this product since there is no comparative advantage. 
E)  the countries will trade only with other nations they are not in competition with. 
A)  each country will export different varieties of the product to the other. 
B)  the country in which the price of the product is lower will export the product. 
C)  the country with a relative abundance of the factor of production in which production of the product is intensive will export this product. 
D)  neither country will export this product since there is no comparative advantage. 
E)  the countries will trade only with other nations they are not in competition with.

Question 16

In the model of monopolistic competition,if firms have ________ average cost curves,then opening trade will ________ the total number of firms and ________ the average price.

Accepted Answer

A)  downward sloping; decrease; decrease 
B)  downward sloping; decrease; increase 
C)  downward sloping; increase; decrease 
D)  upward sloping; decrease; increase 
E)  upward sloping; increase; decrease 
A)  downward sloping; decrease; decrease 
B)  downward sloping; decrease; increase 
C)  downward sloping; increase; decrease 
D)  upward sloping; decrease; increase 
E)  upward sloping; increase; decrease

Question 17

If a firm increases its output in the ________ and unit costs ________,then the firm is experiencing ________ of scale.

Accepted Answer

A)  long-run; decrease; economies 
B)  short-run; decrease; economies 
C)  long-run; decrease; diseconomies 
D)  short-run; decrease; diseconomies 
E)  long-run; increase; economies 
A)  long-run; decrease; economies 
B)  short-run; decrease; economies 
C)  long-run; decrease; diseconomies 
D)  short-run; decrease; diseconomies 
E)  long-run; increase; economies

Question 18

It is possible that trade based on external scale economies may leave a country worse off than it would have been without trade.Explain how this could happen.

Accepted Answer

One answer is that t

Question 19

An imperfectly competitive firm has the following total cost curve: C = 100 + 4Q.What is average fixed cost equal to when Q = 10?

Accepted Answer

The answer of An imperfectly competitive firm has the following...

Question 20

What are the consequences of outsourcing production on the welfare of countries?

Accepted Answer

By taking advantage of cost differential

Intra-industry trade will tend to dominate trade flows when which of the following exists?

A firm in long-run equilibrium under monopolistic competition will earn

A monopolistic firm

During the past decade,U.S.imports of business services have ,U.S.exports of business services have ,and U.S.net exports of business services have .

-Refer to above figure.The monopolist can export as much as it likes of its steel at the world price of $5/ton.How much steel will the monopolist sell,and at what price?

In the model of monopolistic competition,trade costs between countries cause

An imperfectly competitive firm has the following demand curve: Q = 100 - 2P.What is marginal revenue equal to when P = 40?

-The figure above represents the demand and cost functions facing a Brazilian Steel producing monopolist.If it were unable to export,and was constrained by its domestic market,what quantity would it sell at what price?

We often observe "pseudo-intra-industry trade" between the United States and Mexico.Actually,such trade is consistent with

Intra-industry trade is most common in the trade patterns of

International trade based on external scale economies in both countries is likely to be carried out by

In the model of monopolistic competition,trade costs between countries cause

An industry is characterized by scale economies,and exists in two countries.Should these two countries engage in trade such that the combined market is supplied by one country's industry,then

In the model of monopolistic competition,an increase in industry output will producers of higher-priced goods and producers of lower-priced goods.

A product is produced in a monopolistically competitive industry with scale economies.If this industry exists in two countries,and these two countries engage in trade with each other,then we would expect

In the model of monopolistic competition,if firms have average cost curves,then opening trade will the total number of firms and the average price.

If a firm increases its output in the and unit costs ,then the firm is experiencing of scale.

It is possible that trade based on external scale economies may leave a country worse off than it would have been without trade.Explain how this could happen.

An imperfectly competitive firm has the following total cost curve: C = 100 + 4Q.What is average fixed cost equal to when Q = 10?

What are the consequences of outsourcing production on the welfare of countries?

Introduction

National Income Accounting and the Balance of Payments

Labor Productivity and Comparative Advantage: The Ricardian Model

Specific Factors and Income Distribution

Resources and Trade: The Heckscher-Ohlin Model

The Standard Trade Model

External Economies of Scale and the International Location of Production

The Instruments of Trade Policy

The Political Economy of Trade Policy

Trade Policy in Developing Countries

Controversies in Trade Policy

Filters

Exam 8: Firms in the Global Economy: Export Decisions,Outsourcing,and Multinational Enterprises

Intra-industry trade will tend to dominate trade flows when which of the following exists?

A firm in long-run equilibrium under monopolistic competition will earn

A monopolistic firm

During the past decade,U.S.imports of business services have ________,U.S.exports of business services have ________,and U.S.net exports of business services have ________.

-Refer to above figure.The monopolist can export as much as it likes of its steel at the world price of $5/ton.How much steel will the monopolist sell,and at what price?

In the model of monopolistic competition,trade costs between countries cause

An imperfectly competitive firm has the following demand curve: Q = 100 - 2P.What is marginal revenue equal to when P = 40?

-The figure above represents the demand and cost functions facing a Brazilian Steel producing monopolist.If it were unable to export,and was constrained by its domestic market,what quantity would it sell at what price?

We often observe "pseudo-intra-industry trade" between the United States and Mexico.Actually,such trade is consistent with

Intra-industry trade is most common in the trade patterns of

International trade based on external scale economies in both countries is likely to be carried out by

In the model of monopolistic competition,trade costs between countries cause

An industry is characterized by scale economies,and exists in two countries.Should these two countries engage in trade such that the combined market is supplied by one country's industry,then

In the model of monopolistic competition,an increase in industry output will ________ producers of ________ higher-priced goods and ________ producers of lower-priced goods.

A product is produced in a monopolistically competitive industry with scale economies.If this industry exists in two countries,and these two countries engage in trade with each other,then we would expect

In the model of monopolistic competition,if firms have ________ average cost curves,then opening trade will ________ the total number of firms and ________ the average price.

If a firm increases its output in the ________ and unit costs ________,then the firm is experiencing ________ of scale.

It is possible that trade based on external scale economies may leave a country worse off than it would have been without trade.Explain how this could happen.

An imperfectly competitive firm has the following total cost curve: C = 100 + 4Q.What is average fixed cost equal to when Q = 10?

What are the consequences of outsourcing production on the welfare of countries?

Introduction

National Income Accounting and the Balance of Payments

Labor Productivity and Comparative Advantage: The Ricardian Model

Specific Factors and Income Distribution

Resources and Trade: The Heckscher-Ohlin Model

The Standard Trade Model

External Economies of Scale and the International Location of Production

The Instruments of Trade Policy

The Political Economy of Trade Policy

Trade Policy in Developing Countries

Controversies in Trade Policy

Filters

During the past decade,U.S.imports of business services have ,U.S.exports of business services have ,and U.S.net exports of business services have .

In the model of monopolistic competition,an increase in industry output will producers of higher-priced goods and producers of lower-priced goods.

In the model of monopolistic competition,if firms have average cost curves,then opening trade will the total number of firms and the average price.

If a firm increases its output in the and unit costs ,then the firm is experiencing of scale.