Exam 19: Comparative Advantage, international Trade, and Exchange Rates

Figure 19-1 Figure 19-1 shows the U.S.demand and supply for leather footwear. -Refer to Figure 19-1.Suppose the government allows imports of leather footwear into the United States.What will be the quantity of imports?

Figure 19-10 -Refer to Figure 19-10.Suppose that the U.S.government deficit decreases,causing interest rates in the United States to fall relative to those in the European Union.Assuming all else remains constant,how would this be represented?

Which of the following statements is false?

In 1930,the U.S.government attempted to help domestic firms that were harmed by the Great Depression by passing the Smoot-Hawley Tariff.In response to this tariff,other countries ________ and international trade ________.

If there is currently a shortage of dollars,which of the following would you expect to see in the foreign exchange market?

Under autarky,domestic producer surplus is represented by the area

Textbook examples of trade between two nations are simplified in order to show how two nations both benefit from trade.These examples are misleading because

a.Define the term "globalization." b.Describe the benefits of globalization. c.Who is likely to oppose globalization and why?

When Americans decrease their demand for Japanese goods

The "Buy American" provision in the 2009 stimulus package required that stimulus money be spent only on U.S.-made goods,effectively acting as a quota of zero imports when stimulus money was being spent.The "Buy American" provision would ________ consumer surplus and ________ producer surplus for industries that produced protected products in the United States.

Article Summary Roberto Azevedo, director-general of the World Trade Organization (WTO), reported that global trade growth estimates will be lowered for 2013 and 2014 because of increasing global protectionism. The current protectionism is based primarily in regulations rather than the more common tariffs and subsidies. Since 2008, almost 700 new trade restrictions have materialized - over 150 of those in 2012 alone - with Russia being singled out as one of the primary offenders. -Refer to the Article Summary.The protectionism being granted to Russian firms will cause the greatest harm to

In order to avoid the imposition of other types of trade barriers,foreign producers will sometimes agree to voluntary export restraints.With voluntary export restraints,foreign producers

Currency traders expect the value of the dollar to rise.What effect will this have on the demand for dollars and the supply of dollars in the foreign exchange market?

Which of the following is not an example of a trade restriction?

Figure 19-1 Figure 19-1 shows the U.S.demand and supply for leather footwear. -Refer to Figure 19-1.Under autarky,the deadweight loss is

The Smoot-Hawley Tariff

Protectionism refers to the use of trade barriers to shield domestic firms from foreign competition.

Many economists ________ protectionism because it ________ consumers and ________ jobs in domestic industries that use protected products.

Table 19-11 Production and Consumption Production Without Trade With Trade Clucks Huts Clocks Hats Derrnark 900 150 1,200 0 Belize 150 100 0 400 Denmark and Belize can produce both clocks and hats.Table 19-11 shows the production and consumption quantities without trade, and the production numbers with trade. -Refer to Table 19-11.All of the following are terms of trade that could possibly benefit both countries except

A voluntary export restraint is an agreement negotiated between two countries that places a numerical limit on the quantity of a good that can be imported by one country from the other country.