Question 1

A tariff is imposed on a good. This ________ producer surplus and ________ total surplus in importing country.

Accepted Answer

A) increases; does not change 
B) increases; increases 
C) decreases; increases 
D) decreases; decreases 
E) increases; decreases 
A) increases; does not change 
B) increases; increases 
C) decreases; increases 
D) decreases; decreases 
E) increases; decreases E

Question 2

The argument that protection

Accepted Answer

A) penalizes poor environmental standards is true. 
B) allows us to compete with cheap foreign wages is true. 
C) is necessary for infant industries is true. 
D) saves jobs is flawed. 
E) prevents rich countries from exploiting poor countries is true. 
A) penalizes poor environmental standards is true. 
B) allows us to compete with cheap foreign wages is true. 
C) is necessary for infant industries is true. 
D) saves jobs is flawed. 
E) prevents rich countries from exploiting poor countries is true. D

Question 3

Of the groups listed below, which is most likely to lobby for protection?

Accepted Answer

A) workers in the import industry 
B) workers in the export industry 
C) consumers in the import industry 
D) producers in the export industry 
E) workers and consumers in the import industry 
A) workers in the import industry 
B) workers in the export industry 
C) consumers in the import industry 
D) producers in the export industry 
E) workers and consumers in the import industry A

Question 4

Refer to the figure below to answer the following questions.
   
Figure 7.2.2
The figure shows the market for helicopters in Canada, where D is the domestic demand curve and S is the domestic supply curve. Canada trades helicopters with the rest of the world at a price of $36 million per helicopter.
-In Figure 7.2.2, with international trade, Canadian firms buy ________ helicopters per year.

Accepted Answer

A) 240 
B) 480 
C) 720 
D) 360 
E) 600 
A) 240 
B) 480 
C) 720 
D) 360 
E) 600

Question 5

Refer to the figure below to answer the following questions.
   
Figure 7.2.2
The figure shows the market for helicopters in Canada, where D is the domestic demand curve and S is the domestic supply curve. Canada trades helicopters with the rest of the world at a price of $36 million per helicopter.
-In Figure 7.2.2, international trade ________ consumer surplus in Canada by ________.

Accepted Answer

A) decreases; $2.88 billion 
B) decreases; $1.92 billion 
C) increases; $2.88 billion 
D) increases; $4.8 billion 
E) increases; $1.92 billion 
A) decreases; $2.88 billion 
B) decreases; $1.92 billion 
C) increases; $2.88 billion 
D) increases; $4.8 billion 
E) increases; $1.92 billion

Question 6

In industrial countries, there is more reliance on ________ as opposed to ________ for government revenue.

Accepted Answer

A) tariffs; tax collection 
B) import quotas; tariffs 
C) tariffs; import quotas 
D) import quotas; tax collection 
E) tax collection; tariffs 
A) tariffs; tax collection 
B) import quotas; tariffs 
C) tariffs; import quotas 
D) import quotas; tax collection 
E) tax collection; tariffs

Question 7

Suppose that the world price of eggs is $1 a dozen, Canada does not trade internationally, and the equilibrium price of eggs in Canada is $3 a dozen. Then Canada begins to trade internationally. Canadian farmers produce ________ eggs. Canada ________ eggs.

Accepted Answer

A) more; imports 
B) more; exports 
C) less; exports 
D) less; imports 
E) the same quantity of; imports 
A) more; imports 
B) more; exports 
C) less; exports 
D) less; imports 
E) the same quantity of; imports

Question 8

The goods and services we sell to people in other countries are our

Accepted Answer

A) tariffs. 
B) quotas. 
C) exports. 
D) imports. 
E) investment goods and services. 
A) tariffs. 
B) quotas. 
C) exports. 
D) imports. 
E) investment goods and services.

Question 9

Choose the correct statement.

Accepted Answer

A) Exports include goods and services. 
B) Imports include goods but not services. 
C) Imports include services but not goods. 
D) Exports include goods but not services. 
E) Exports include services but not goods. 
A) Exports include goods and services. 
B) Imports include goods but not services. 
C) Imports include services but not goods. 
D) Exports include goods but not services. 
E) Exports include services but not goods.

Question 10

When a Canadian firm implements offshore outsourcing, consumers in Canada ________, and workers in Canada in the industry that is being outsourced ________.

Accepted Answer

A) gain; neither gain nor lose 
B) lose; lose 
C) lose; gain 
D) gain; lose 
E) gain; gain 
A) gain; neither gain nor lose 
B) lose; lose 
C) lose; gain 
D) gain; lose 
E) gain; gain

Question 11

A country opens up to trade and becomes an exporter of a good. Consumer surplus ________ and producer surplus ________.

Accepted Answer

A) decreases; increases 
B) increases; decreases 
C) remains unchanged; decreases 
D) remains unchanged; increases 
E) decreases; decreases 
A) decreases; increases 
B) increases; decreases 
C) remains unchanged; decreases 
D) remains unchanged; increases 
E) decreases; decreases

Question 12

Of the following, in which decade were Canada's tariffs at their lowest level?

Accepted Answer

A) 2000s 
B) 1970s 
C) 1950s 
D) 1930s 
E) 1890s 
A) 2000s 
B) 1970s 
C) 1950s 
D) 1930s 
E) 1890s

Question 13

Which of the following is an explanation for the existence of trade restrictions?

Accepted Answer

A) tariffs generate revenue for the government 
B) rent seeking 
C) inefficient quotas 
D) both A and B 
E) both A and C 
A) tariffs generate revenue for the government 
B) rent seeking 
C) inefficient quotas 
D) both A and B 
E) both A and C

Question 14

Among the following, the domestic government gains the most revenue when it

Accepted Answer

A) imposes an import quota. 
B) eliminates an import quota. 
C) encourages freer trade. 
D) imposes a tariff. 
E) increases the demand for a domestically-produced good. 
A) imposes an import quota. 
B) eliminates an import quota. 
C) encourages freer trade. 
D) imposes a tariff. 
E) increases the demand for a domestically-produced good.

Question 15

Tariffs

Accepted Answer

A) generate revenue for consumers. 
B) generate revenue for the government. 
C) encourage domestic consumers to buy more imports. 
D) encourage domestic producers to produce less. 
E) lower prices for consumers. 
A) generate revenue for consumers. 
B) generate revenue for the government. 
C) encourage domestic consumers to buy more imports. 
D) encourage domestic producers to produce less. 
E) lower prices for consumers.

Question 16

Canada imports cars from Japan. If Canada imposes a tariff on cars imported from Japan, Canadian

Accepted Answer

A) consumers will lose and Japanese producers will gain. 
B) tariff revenue will equal the loss of Canadian consumer surplus. 
C) consumers will lose and Canadian producers will gain. 
D) car manufacturers will gain revenue equal to the revenue lost by Japanese car manufacturers. 
E) producers will lose and Japanese consumers will gain. 
A) consumers will lose and Japanese producers will gain. 
B) tariff revenue will equal the loss of Canadian consumer surplus. 
C) consumers will lose and Canadian producers will gain. 
D) car manufacturers will gain revenue equal to the revenue lost by Japanese car manufacturers. 
E) producers will lose and Japanese consumers will gain.

Question 17

Canada exports athletic coaching services and imports computer tech support. The price of computer tech support in Canada is ________ with international trade than without international trade. As a result of trade in computer tech support, the Canadian producer surplus from computer tech support ________.

Accepted Answer

A) higher; increases 
B) lower; decreases 
C) lower; does not change 
D) higher; decreases 
E) lower; increases 
A) higher; increases 
B) lower; decreases 
C) lower; does not change 
D) higher; decreases 
E) lower; increases

Question 18

When Canada exports a good, the amount of the ________ in Canada's consumer surplus is ________ the amount of the increase in Canada's producer surplus.

Accepted Answer

A) increase; smaller than 
B) increase; larger than 
C) decrease; smaller than 
D) decrease; equal to 
E) decrease; larger than 
A) increase; smaller than 
B) increase; larger than 
C) decrease; smaller than 
D) decrease; equal to 
E) decrease; larger than

Question 19

Refer to the figure below to answer the following question.
   
Figure 7.2.3
-Refer to Figure 7.2.3. The graph shows the market for shoes in Canada. The world price of a pair of shoes is $20. With free international trade, Canadian consumer surplus ________ and Canadian producer surplus ________.

Accepted Answer

A) increases by area A + B; decreases by area B 
B) increases by area B; decreases by area B 
C) increases by area A; decreases by area B 
D) decreases by area A + B; increases by area B 
E) decreases by area B; increases by area A 
A) increases by area A + B; decreases by area B 
B) increases by area B; decreases by area B 
C) increases by area A; decreases by area B 
D) decreases by area A + B; increases by area B 
E) decreases by area B; increases by area A

Question 20

Suppose the country of Mooland imposes tariffs on imported beef from the country of Aqualand. As a result of the tariffs, the

Accepted Answer

A) price of beef in Mooland falls. 
B) quantity of beef exported by Mooland increases. 
C) quantity of beef imported by Mooland decreases. 
D) quantity of beef imported by Mooland increases. 
E) price of beef in Mooland does not change. 
A) price of beef in Mooland falls. 
B) quantity of beef exported by Mooland increases. 
C) quantity of beef imported by Mooland decreases. 
D) quantity of beef imported by Mooland increases. 
E) price of beef in Mooland does not change.

Exam 7: Global Markets in Action

A tariff is imposed on a good. This ________ producer surplus and ________ total surplus in importing country.

The argument that protection

Of the groups listed below, which is most likely to lobby for protection?

In industrial countries, there is more reliance on ________ as opposed to ________ for government revenue.

Suppose that the world price of eggs is $1 a dozen, Canada does not trade internationally, and the equilibrium price of eggs in Canada is $3 a dozen. Then Canada begins to trade internationally. Canadian farmers produce ________ eggs. Canada ________ eggs.

The goods and services we sell to people in other countries are our

Choose the correct statement.

When a Canadian firm implements offshore outsourcing, consumers in Canada ________, and workers in Canada in the industry that is being outsourced ________.

A country opens up to trade and becomes an exporter of a good. Consumer surplus ________ and producer surplus ________.

Of the following, in which decade were Canada's tariffs at their lowest level?

Which of the following is an explanation for the existence of trade restrictions?

Among the following, the domestic government gains the most revenue when it

Tariffs

Canada imports cars from Japan. If Canada imposes a tariff on cars imported from Japan, Canadian

When Canada exports a good, the amount of the ________ in Canada's consumer surplus is ________ the amount of the increase in Canada's producer surplus.

Refer to the figure below to answer the following question. Figure 7.2.3 -Refer to Figure 7.2.3. The graph shows the market for shoes in Canada. The world price of a pair of shoes is $20. With free international trade, Canadian consumer surplus ________ and Canadian producer surplus ________.

Suppose the country of Mooland imposes tariffs on imported beef from the country of Aqualand. As a result of the tariffs, the

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Governments Actions in Markets

Utility and Demand

Possibilities, Preferences, and Choices

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Public Goods and Common Resources

Markets for Factors of Production

Economic Inequality

Measuring Gdp and Economic Growth

Monitoring Jobs and Inflation

Economic Growth

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers

The Business Cycle, Inflation, and Deflation

Fiscal Policy

Monetary Policy

Macro Only: International Trade Policy

Filters

A tariff is imposed on a good. This producer surplus and total surplus in importing country.

In industrial countries, there is more reliance on as opposed to for government revenue.

Suppose that the world price of eggs is $1 a dozen, Canada does not trade internationally, and the equilibrium price of eggs in Canada is $3 a dozen. Then Canada begins to trade internationally. Canadian farmers produce eggs. Canada eggs.

When a Canadian firm implements offshore outsourcing, consumers in Canada , and workers in Canada in the industry that is being outsourced .

A country opens up to trade and becomes an exporter of a good. Consumer surplus and producer surplus .

When Canada exports a good, the amount of the in Canada's consumer surplus is the amount of the increase in Canada's producer surplus.

Refer to the figure below to answer the following question. Figure 7.2.3 -Refer to Figure 7.2.3. The graph shows the market for shoes in Canada. The world price of a pair of shoes is $20. With free international trade, Canadian consumer surplus and Canadian producer surplus .