Exam 19: World Trade Equilibrium

According to the Heckscher-Ohlin theory, comparative advantage is based on:

For purposes of determining comparative advantage, the cost of producing a good in each of two countries is measured in terms of:

The import demand curve shows the amount of the home country's:

The difference between absolute and comparative advantage is that:

The product life cycle theory predicts that comparative advantage shifts away from the country of origin if:

The following table shows that in one day poultry farmers in Arkansas can produce 3 cartons of eggs, while poultry farmers in Idaho can produce 2 cartons of eggs. It takes Arkansas potato farmers one day to produce 30 tons of potatoes, while Idaho potato farmers produce 10 tons of potatoes in that same time.?Table 20.4 -Refer to Table 20.4. Producing 1 more crate of eggs would require Arkansas to:

The figure given below shows the import demand and export supply curves of corn of the U.S. and Mexico.?Figure 20.2 -According to Figure 20.2, the international equilibrium price of corn is:

Suppose France can produce 9,000 potatoes or 3,000 lemons per day, and that Italy can produce 3,000 potatoes or 3,000 lemons per day. Which of the following statements in this context is true?

The following table shows the units of calculators and rice produced by a laborer in a day in Japan and Korea.?Table 20.3 -Refer to Table 20.3. Determine the limits on the terms of trade for 1 pound of rice.

The table below shows units of wheat and cloth produced by each worker per day in both the countries.?Table 20.1 -Which of the following can be inferred from the information provided in Table 20.1?

The most heavily traded category of goods in the world is:

Absolute advantage is irrelevant, because knowing the absolute number of labor hours required to produce a good does not tell us if we can benefit from trade.

Developing countries can be expected to have a comparative advantage in industries requiring a relatively large amount of skilled labor.

Differences in the productivity of labor account for comparative advantage if:

If Bolivia can produce 6 calculators or 3 televisions in a day, and Argentina can produce 4 calculators or 12 televisions in a day, then Bolivia would be willing to trade 1 calculator for 1 television with Argentina.

The comparative advantage in a specific good can shift over time from one country to another, as the other countries can produce it at a cheaper cost after imitating the technology.

The simultaneous import and export of goods in the same industry by a particular country is known as interindustry trade.

Whether exchange is between individuals, firms, or countries, voluntary trade occurs because:

Which of the following factors are least likely to affect what countries end up trading in the international market?

If a laborer in Mexico can produce 2 bushels of wheat or 4 bushels of corn in a day, the opportunity cost of producing wheat is 4 bushels of corn.