Question 1

Figure 9-10
  
-Refer to Figure 9-10.What would be producer surplus after trade

Accepted Answer

A) $900 
B) $1100 
C) $1800 
D) $3600 
A) $900 
B) $1100 
C) $1800 
D) $3600

Question 2

Figure 9-6
  
-Refer to Figure 9-6.With free trade,what would producer surplus be

Accepted Answer

A) $80 
B) $150 
C) $160 
D) $200 
A) $80 
B) $150 
C) $160 
D) $200

Question 3

Figure 9-6
  
-Refer to Figure 9-6.Without trade,what would total surplus be

Accepted Answer

A) $122.50 
B) $306.25 
C) $612.50 
D) $1050.00 
A) $122.50 
B) $306.25 
C) $612.50 
D) $1050.00

Question 4

If Brazil has a comparative advantage in producing sugar,and trade in sugar is allowed,what can be said about Brazil

Accepted Answer

A) Brazil will become an importer of sugar. 
B) Brazil will become an exporter of sugar. 
C) Brazil could only become an importer of sugar if it has absolute advantage in producing sugar. 
D) Brazil could only become an exporter of sugar if it has absolute advantage in producing sugar. 
A) Brazil will become an importer of sugar. 
B) Brazil will become an exporter of sugar. 
C) Brazil could only become an importer of sugar if it has absolute advantage in producing sugar. 
D) Brazil could only become an exporter of sugar if it has absolute advantage in producing sugar.

Question 5

Where will workers displaced by trade eventually find jobs

Accepted Answer

A) in another country 
B) in the government sector 
C) in the industries in which the country has a comparative advantage 
D) in a different company in the same industry 
A) in another country 
B) in the government sector 
C) in the industries in which the country has a comparative advantage 
D) in a different company in the same industry

Question 6

Figure 9-6
  
-Refer to Figure 9-6.If this country allows free trade in wagons,how much will producers gain or lose

Accepted Answer

A) gain by $45 
B) gain by $210 
C) lose by $210 
D) lose by $165 
A) gain by $45 
B) gain by $210 
C) lose by $210 
D) lose by $165

Question 7

Figure 9-12
  
-Refer to Figure 9-12.What would consumer surplus be with free trade

Accepted Answer

A) A + B 
B) A + C + D + E 
C) A + B + C + D + E + F 
D) A + C + G 
A) A + B 
B) A + C + D + E 
C) A + B + C + D + E + F 
D) A + C + G

Question 8

The finance minister of a province that has many textile firms wants to impose tariffs on all imported textiles.Which of the following is NOT a likely consequence of such tariffs

Accepted Answer

A) Domestic textile buyers will lose consumer surplus, have less variety, and will pay higher prices. 
B) Domestic textile sellers will gain producer surplus. 
C) Domestic textile sellers will have a higher rate of technological advance. 
D) Domestic textile sellers will have more market power. 
A) Domestic textile buyers will lose consumer surplus, have less variety, and will pay higher prices. 
B) Domestic textile sellers will gain producer surplus. 
C) Domestic textile sellers will have a higher rate of technological advance. 
D) Domestic textile sellers will have more market power.

Question 9

If a country allows trade and the domestic price of a good is different from the world price,will the country become an exporter

Accepted Answer

A) yes, if the domestic price is lower, it will export 
B) no, if the domestic price is lower, it will import 
C) no, it will only export if the domestic price is the same as the world price 
D) no, it will only export if the domestic price is higher than the world price 
A) yes, if the domestic price is lower, it will export 
B) no, if the domestic price is lower, it will import 
C) no, it will only export if the domestic price is the same as the world price 
D) no, it will only export if the domestic price is higher than the world price

Question 10

In a two-country world,the opening of free trade does not make everyone in the two countries better off.Why should we promote international trade

Accepted Answer

It is True that free trade does not bene

Question 11

Tariffs cause deadweight loss because they move the price of an imported product closer to the equilibrium without trade,thus reducing the gains from trade.

Accepted Answer

A) True 
 B)False

Question 12

Figure 9-6
  
-Refer to Figure 9-6.If this country allows free trade in wagons,who will gain or lose

Accepted Answer

A) Consumers will gain, and producers will lose. 
B) Consumers will lose, and producers will gain. 
C) Both consumers and producers will gain. 
D) Both consumers and producers will lose. 
A) Consumers will gain, and producers will lose. 
B) Consumers will lose, and producers will gain. 
C) Both consumers and producers will gain. 
D) Both consumers and producers will lose.

Question 13

Figure 9-6
  
-Refer to Figure 9-6.Without trade,what would consumer surplus be

Accepted Answer

A) $210.50 
B) $245.50 
C) $367.50 
D) $560.00 
A) $210.50 
B) $245.50 
C) $367.50 
D) $560.00

Question 14

When a country allows free trade,how will the domestic price of a product compare with the world price

Accepted Answer

A) The domestic price will be greater than the world price. 
B) The domestic price will be lower than the world price. 
C) The domestic price will equal the world price. 
D) The domestic price is the prevailing price, regardless of the world price. 
A) The domestic price will be greater than the world price. 
B) The domestic price will be lower than the world price. 
C) The domestic price will equal the world price. 
D) The domestic price is the prevailing price, regardless of the world price.

Question 15

If the world price of a good is greater than the domestic price in a country that can engage in international trade,that country would become an importer of that good.

Accepted Answer

A) True 
 B)False

Question 16

Trade decisions are based on the concept of absolute advantage.

Accepted Answer

A) True 
 B)False

Question 17

When a country allows trade and becomes an exporter of a good,what happens to consumer surplus and producer surplus

Accepted Answer

A) Consumer surplus and producer surplus will increase. 
B) Consumer surplus and producer surplus will decrease. 
C) Consumer surplus will increase, and producer surplus will decrease. 
D) Consumer surplus will decrease, and producer surplus will increase. 
A) Consumer surplus and producer surplus will increase. 
B) Consumer surplus and producer surplus will decrease. 
C) Consumer surplus will increase, and producer surplus will decrease. 
D) Consumer surplus will decrease, and producer surplus will increase.

Question 18

What is trade among nations ultimately based on

Accepted Answer

A) absolute advantage 
B) political advantage 
C) comparative advantage 
D) technical advantage 
A) absolute advantage 
B) political advantage 
C) comparative advantage 
D) technical advantage

Question 19

Sweden is an importer of goose down parkas.The world price of these parkas is $500.Sweden imposes a $17 tariff on parkas.Sweden is a price taker in the parka market.As a result of the tariff,who will gain

Accepted Answer

A) Swedish consumers of parkas will gain and producers will lose. 
B) Swedish consumers of parkas will lose and producers will gain. 
C) Swedish consumers of parkas will gain and producers will gain. 
D) Swedish consumers of parkas will lose and producers will lose. 
A) Swedish consumers of parkas will gain and producers will lose. 
B) Swedish consumers of parkas will lose and producers will gain. 
C) Swedish consumers of parkas will gain and producers will gain. 
D) Swedish consumers of parkas will lose and producers will lose.

Question 20

Figure 9-7
  
-Refer to Figure 9-7.If trade in shoes is allowed,what action will Korea take

Accepted Answer

A) Korea will become an importer of shoes. 
B) Korea will become an exporter of shoes. 
C) Korea could become either an importer or an exporter of shoes. 
D) Korea will neither import nor export shoes. 
A) Korea will become an importer of shoes. 
B) Korea will become an exporter of shoes. 
C) Korea could become either an importer or an exporter of shoes. 
D) Korea will neither import nor export shoes.

Exam 9: Application: International Trade

Figure 9-10 -Refer to Figure 9-10.What would be producer surplus after trade

Figure 9-6 -Refer to Figure 9-6.With free trade,what would producer surplus be

Figure 9-6 -Refer to Figure 9-6.Without trade,what would total surplus be

If Brazil has a comparative advantage in producing sugar,and trade in sugar is allowed,what can be said about Brazil

Where will workers displaced by trade eventually find jobs

Figure 9-6 -Refer to Figure 9-6.If this country allows free trade in wagons,how much will producers gain or lose

Figure 9-12 -Refer to Figure 9-12.What would consumer surplus be with free trade

The finance minister of a province that has many textile firms wants to impose tariffs on all imported textiles.Which of the following is NOT a likely consequence of such tariffs

If a country allows trade and the domestic price of a good is different from the world price,will the country become an exporter

In a two-country world,the opening of free trade does not make everyone in the two countries better off.Why should we promote international trade

Tariffs cause deadweight loss because they move the price of an imported product closer to the equilibrium without trade,thus reducing the gains from trade.

Figure 9-6 -Refer to Figure 9-6.If this country allows free trade in wagons,who will gain or lose

Figure 9-6 -Refer to Figure 9-6.Without trade,what would consumer surplus be

When a country allows free trade,how will the domestic price of a product compare with the world price

If the world price of a good is greater than the domestic price in a country that can engage in international trade,that country would become an importer of that good.

Trade decisions are based on the concept of absolute advantage.

When a country allows trade and becomes an exporter of a good,what happens to consumer surplus and producer surplus

What is trade among nations ultimately based on

Sweden is an importer of goose down parkas.The world price of these parkas is $500.Sweden imposes a $17 tariff on parkas.Sweden is a price taker in the parka market.As a result of the tariff,who will gain

Figure 9-7 -Refer to Figure 9-7.If trade in shoes is allowed,what action will Korea take

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, demand, and Government Policies

Consumers, producers, and the Efficiency of Markets

Application: the Costs of Taxation

Externalities

Public Goods and Common Resources

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers of Microeconomics

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