Exam 8: Trade

The following figure shows the demand curve, D, and the supply curve, S, for calculators in Barylia. The world price of calculators is $40. -Refer to the figure above.What is the domestic demand for calculators in Barylia once the economy opens up to free trade?

Scenario: Suppose a country produces only two goods: Good X and Good Y. -Refer to the scenario above.The opportunity cost of producing Good X equals ________.

The following figure represents various production possibilities curves (PPCs) of economies that produce apples and oranges. -Refer to the figure above.An economy produces apples and oranges.To expand the production of oranges,this economy needs to give up producing more and more apples.Which of the curves in the figure correctly represents the production possibilities frontier of this economy?

The figure below shows the domestic supply and demand of a product in the United States. -Refer to the figure above.If the world price of this product is $8,U.S.will gain ________ in social surplus if it engages in free trade in this product.

The following figure shows the production possibilities curve for a software engineer who has to divide her available time between producing computer programs and Web sites. -Refer to the figure above.If the engineer spends her entire time on producing Web sites,how many Web sites can she produce?

In the mid-nineteenth century,the American steel rail industry could not compete with the established British steel rail industry,and imports of British steel rails flooded the U.S.market.In response,the U.S.government imposed high tariffs on steel rails until U.S.steel rail mills could compete with their British counterparts.This is an example of ________.

Which of the following is not a characteristic of countries in a free trade area?

A(n)________ is any good that is produced domestically but sold abroad,and a(n)________ is any good that is produced abroad but sold domestically.

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 is the value of A?

Scenario: The domestic supply and demand of a good in the United States is shown in the figure below. Suppose the world price of this good is $4. Suppose the United States is considering levying a $2 tariff per unit on imports of this good. -Refer to the scenario above.The U.S.government will make ________ in revenue from this tariff.

The term "infant industries" often refers to ________.

Suppose an economy produces only solar panels and coal.Between 2005 and 2015,the production possibilities curve (PPC)for this economy shifted out as characterized in the figure below. Which of the following statements best describes the shift in the PPC between 2005 and 2015?

________ countries,in an effort to promote economic growth and jobs,use ________ pollution regulations to attract industry.

The following figure depicts four different scenarios in which the blue line represents California's production possibilities curve (PPC) and the red line represents Texas' PPC. These two states trade wine and cloth. -Refer to the figure above.In what scenario would the terms of trade of cloth for wine be between 0.2 and 0.67 ?

Scenario: The following figure shows the demand curve, D, and the supply curve, S, of chairs in Barylia. Barylia is open to free trade. The world price of chairs is $3, and the government of Barylia decides to impose a $1 tariff on the import of chairs. -Refer to the scenario above.What is the domestic price of chairs in Barylia in the absence of trade?

Scenario: Meryl and Steve are two classmates who form a study group. The graph below shows the production possibilities curves for each of them. -Refer to the scenario above.If Meryl and Steve decide to join forces to do school work and trade,then ________.

Scenario: Jack takes 3 hours to complete a painting and 6 hours to create a sculpture. He has 30 hours of time to spend on both activities. -Refer to the scenario above.Which of the following combinations will lie on Jack's production possibilities curve?

The figure below shows production possibilities curves for tomatoes and oranges in two prefectures in a country. -Refer to the figure above. Suppose that Prefecture A produces at point Y, while Prefecture B produces at point Z. Could there be gains from trade (Prefecture A sells oranges to Prefecture B, and Prefecture B sells tomatoes to Prefecture B)? Why or why not?

Scenario: Yasmin and Zeek are lawyers working at V, W, and X LLP. Yasmin works 48 hours a week, and Zeek also works 48 hours a week. They handle two types of cases, intellectual property (IP) cases and corporate fraud (CF) cases. It takes Yasmin 6 hours to handle each IP case and 4 hours to handle each CF case. Zeek can finish an IP case in 3 hours and a CF case in 6 hours. -Refer to the scenario above.Who has a comparative advantage in handling CF cases and why?

Scenario: The domestic supply and demand of a good in the United States is shown in the figure below. Suppose the world price of this good is $4. Suppose the United States is considering levying a $2 tariff per unit on imports of this good. -Refer to the scenario above.Before the tariff is imposed,________ units of this good were imported; after the tariff,________ units of this good are imported.