Exam 9: Global Markets in Action

The figure above shows the U.S. market for T-shirts, where SUS is the domestic supply curve and DUS is the domestic demand curve. The world price of a T-shirt is $5. The U.S. government imposes a $2 per unit tariff on imported T-shirts. -The figure above shows that as a result of the tariff, the price of a T-shirt in the United States ________, and the quantity of T-shirts bought ________.

-The above figure shows the U.S.market for replacement cell phone batteries.With free international trade, the United States

International trade decreases the demand for workers in domestic industries that

Who gains from international trade?

If a nation imports a good that can be domestically produced, what happens to the quantity consumed of the good and why?

If a nation can produce a good or service at the lowest opportunity cost, then it

Suppose that elimination of tariffs on agricultural products means that 1,000 farm workers lose jobs that pay an average of $20,000 per year.At the same time, because of the importation of relatively cheaper foreign vegetables, 150 million consumers save $2 per year on their grocery bills. a∙What is the total income lost by farm workers because of the free trade? b∙What is the total dollar amount saved by all consumers combined? c∙Which is greater, the lost income or the consumer savings? Do the benefits of free trade outweigh the costs in this simple example? d∙Which group is most likely to become politically involved over the issue of removing the tariffs, the farm workers or the consumers? Why?

If the United States starts to import a good that had previously been produced in the United States, the market price of the good in the United States

A tariff is

-A quota is

The figure above shows the U.S. market for T-shirts, where SUS is the domestic supply curve and DUS is the domestic demand curve. The United States trades freely with the rest of the world. The world price of a T-shirt is $5. -Based on the figure above, as a result of international trade, consumer surplus

-The above figure shows the U.S.market for flip-flops.With no international trade, the price in the United States for flip-flops is ________.With international trade, the price in the United States for flip-flops is ________.

When a tariff is imposed on a good, the ________ increases.

Which of the following groups gain from international trade? I∙producers of exported goods Ii∙domestic consumers of imported goods Iii∙workers in exporting firms

If the United States imposed a quota on the amount of salmon imported from Chile, the result would be ________ salmon prices in the United States and ________ in the quantity of salmon demanded in the United States.

Comparing developed and developing nations in their use of tariffs, we see that

How can a domestic producer determine whether or not it has a comparative advantage in the production of a good or service?

Because wage rates are so low in Africa, why don't Microsoft, Cisco and other major corporations close down their American operations and move to Africa?

Relative to free trade, domestic consumers of a good are _______ off with a tariff because of the ________.

Which of the following methods of restricting trade does NOT create a deadweight loss?