Exam 8: Trade

The figure below shows the potential gains from specialization for farms in Idaho and Iowa. -Refer to the figure above.Which of the following terms of trade will result in mutual gains for both Idaho and Iowa?

The underlying motivation for trade,relies on one simple principle.What is it?

Which of the following is not a factor in shifting the production possibilities curve?

The use of government regulations and barriers to control trade is referred to as ________.

A few decades ago,there were hardly any Subway restaurants in India.Now they are present in almost every big city.This is an outcome of ________.

Which of the following is likely to rightward shift the production possibilities curve of a nation?

The following figure depicts the production possibilities curve when Ann and Bob engage in trade. With all her resources, Ann can either produce two computer programs or one Web site. With all his resources, Bob can either produce one computer program or three Web sites. -Refer to the figure above.What should be the values of C and D?

Which of the following statements is true?

Scenario: Now suppose the United States can trade wheat with the rest of the world, taking the world price of $2 per bushel as given in the figure below. -Refer to the scenario above.The gain in consumer surplus from free trade is represented by the area ________.

The following figure shows the demand curve, D, and the supply curve, S, for calculators in Barylia in four different scenarios. Barylia is open to free trade. -Refer to the figure above.Let the world price of calculators be $4.In what scenario(s)does Barylia become a net exporter of calculators?

Scenario: Suppose the world price is $2 per bushel, and U.S. wheat growers are dissatisfied with the level of wheat imports into the United States. They lobby Congress for a $1 per bushel tariff on imported wheat. The following figure shows the U.S. wheat market. -Refer to the scenario above.The decrease in consumer surplus resulting from the tariff is given by which area in the figure?

Scenario: Norway and Sweden each produce cloudberries (CB) and salted cod (SC). Their production possibilities curves for these two goods are shown below. Production Possibilities: Norway and Sweden (thousands of kilos) Opportunity Costs: Norway and Sweden -Refer to the scenario above.________ has the absolute advantage in producing cloudberries,while ________ has the absolute advantage in producing salted cod.

The following figure shows the demand curve, D, and supply curve, S, of ballpoint pens in Lithasia. The world price of pens is $2. -Refer to the figure above.What is the consumer surplus before Lithasia opens up to free trade?

The following figure depicts a nonlinear production possibilities curve. -Refer to the figure above.If the market economy moves from point A to point C,________.

A firm producing calculators and cell phones purchases new machinery that increases the productivity of producing calculators.Assuming that the number of calculators produced is measured on the x-axis and the number of cell phones produced is measured on the y-axis,how will the introduction of the new machinery change the firm's production possibilities curve?

The following figure shows the production possibilities curves (PPCs) of two individuals, Ryan and Tom. -Refer to the figure above.Which of the following statements is true?

Which of the following best describes a production possibilities curve?

The shift toward more open,integrated economies that participate in foreign trade and investment is referred to as ________.

Scenario: Hawaii and South Carolina are trading partners. Hawaii has an absolute advantage in the production of both coffee and tea. The opportunity cost of producing 1 pound of tea in Hawaii is 2 pounds of coffee, and the opportunity cost of producing 1 pound of tea in South Carolina is 1/3 pound of coffee. -Refer to the scenario above.Which of the following statements is true?

Scenario: Now suppose the United States continues to trade wheat freely with the rest of the world but that the world price is $6 per bushel, as shown in the figure below. -Refer to the scenario above.At this new world price,the United States ________ wheat in the amount of ________ million metric tons.