Question 1

When a nation exports a good or service in which it has a comparative advantage, production of the good or service

Accepted Answer

A) decreases. 
B) stays the same. 
C) increases. 
D) might change, but more information about what the country imports is needed to determine if production increases, decreases, or does not change. 
E) might change, but more information about what else the country exports is needed to determine if production increases, decreases, or does not change. 
A) decreases. 
B) stays the same. 
C) increases. 
D) might change, but more information about what the country imports is needed to determine if production increases, decreases, or does not change. 
E) might change, but more information about what else the country exports is needed to determine if production increases, decreases, or does not change.

Question 2

-The table above has the domestic supply and domestic demand schedules for a product.What is the equilibrium price with no trade? Over what range of prices will the country export the good? Over what range will it import the good? Suppose the world price is $20.What is the quantity demanded, the quantity supplied, and the amount of the good exported or imported?

Accepted Answer

The price with no trade is $12.The count

Question 3

When a nation exports a good, its total surplus ________, and when it imports a good, its total surplus ________.

Accepted Answer

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

Question 4

A nation will import a good if its no-trade, domestic

Accepted Answer

A) price is equal to the world price. 
B) price is less than the world price. 
C) price is greater than the world price. 
D) quantity is less than the world quantity. 
E) quantity is greater than the world quantity. 
A) price is equal to the world price. 
B) price is less than the world price. 
C) price is greater than the world price. 
D) quantity is less than the world quantity. 
E) quantity is greater than the world quantity.

Question 5

How does a quota affect the domestic price of the import, the domestic consumption, the domestic production, and the quantity imported?

Accepted Answer

A quota raises the price of the good bec

Question 6

A tax on a good that is imposed when it is imported is called

Accepted Answer

A) an import quota. 
B) a VER. 
C) a tariff. 
D) a sanction. 
E) a border tax. 
A) an import quota. 
B) a VER. 
C) a tariff. 
D) a sanction. 
E) a border tax.

Question 7

With no international trade, the U.S.price of wheat is lower than the world price of wheat.This indicates that the United States ________ a comparative advantage in the production of wheat and with international trade, the United States will ________ wheat.

Accepted Answer

A) has; export 
B) has; not trade 
C) has; import 
D) does not have; export 
E) might have; export 
A) has; export 
B) has; not trade 
C) has; import 
D) does not have; export 
E) might have; export

Question 8

-The table above gives the domestic demand and supply schedules for a good.Suppose the world price of the good is $40 and the government imposes a $20 per unit tariff.How much will the government collect as tariff revenue?

Accepted Answer

A) $160 
B) $320 
C) $80 
D) $240 
E) $360 
A) $160 
B) $320 
C) $80 
D) $240 
E) $360

Question 9

Country A imports 1,000 cars per month.After imposing a $50 per car tariff, imports fall to 800 cars per month.How much does Country A's government collect in tariff revenue?

Accepted Answer

A) $90,000 
B) $50,000 
C) $40,000 
D) $10,000 
E) $60,000 
A) $90,000 
B) $50,000 
C) $40,000 
D) $10,000 
E) $60,000

Question 10

-The above figure shows the U.S.market for 1 carat diamonds.Suppose the United States imposes the import quota shown in the figure.With the import quota, how many diamonds can be imported?

Accepted Answer

A) 500,000 
B) 700,000 
C) 400,000 
D) 900,000 
E) 300,000 
A) 500,000 
B) 700,000 
C) 400,000 
D) 900,000 
E) 300,000

Question 11

Which of the following is true?
I∙When the world price of a good is lower than the price that balances domestic supply and demand, a country gains from exporting the good.
Ii∙Compared to a no-trade situation, in a market with imports, consumer surplus is larger.
Iii∙Quotas raise the domestic price of imported goods.

Accepted Answer

A) Only i 
B) Only ii 
C) Only iii 
D) i and ii 
E) ii and iii 
A) Only i 
B) Only ii 
C) Only iii 
D) i and ii 
E) ii and iii

Question 12

The imposition of a quota ________ domestic production, ________ imports, and ________ domestic purchases.

Accepted Answer

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

Question 13

Of the following, who is harmed by a tariff?

Accepted Answer

A) domestic buyers of the good or service 
B) the overall domestic economy 
C) the foreign exporter of the good or service 
D) domestic producers of the good or service 
E) Both answers A and B are correct. 
A) domestic buyers of the good or service 
B) the overall domestic economy 
C) the foreign exporter of the good or service 
D) domestic producers of the good or service 
E) Both answers A and B are correct.

Question 14

A quota ________ a deadweight loss and a tariff ________ a deadweight loss.

Accepted Answer

A) creates; creates 
B) creates; does not create 
C) does not create; creates 
D) does not create; does not create 
E) might create; might create 
A) creates; creates 
B) creates; does not create 
C) does not create; creates 
D) does not create; does not create 
E) might create; might create

Question 15

International trade is definitely in the social interest if

Accepted Answer

A) consumer surplus increases. 
B) producer surplus increases. 
C) consumer surplus does not decreases. 
D) producer surplus does not decreases. 
E) total surplus increases. 
A) consumer surplus increases. 
B) producer surplus increases. 
C) consumer surplus does not decreases. 
D) producer surplus does not decreases. 
E) total surplus increases.

Question 16

The argument that it is necessary to protect a new industry to enable it to grow into a mature industry that can compete in world markets is known as the

Accepted Answer

A) national security argument. 
B) diversity argument. 
C) infant-industry argument. 
D) environmental protection argument. 
E) national youth protection argument. 
A) national security argument. 
B) diversity argument. 
C) infant-industry argument. 
D) environmental protection argument. 
E) national youth protection argument.

Question 17

-The difference between a tariff and a quota is that the revenue from the tariff goes to the

Accepted Answer

A) domestic consumer. 
B) domestic producer. 
C) domestic government. 
D) foreign producers. 
E) foreign government. 
A) domestic consumer. 
B) domestic producer. 
C) domestic government. 
D) foreign producers. 
E) foreign government.

Question 18

In the 1980s, the U.S.government forced Japanese automakers to limit their exports to the United States.The union representing the autoworkers (UAW), argued that otherwise the U.S.auto industry would have contracted.The UAW's argument is the ________ argument for protection.

Accepted Answer

A) save domestic jobs 
B) national security 
C) anti-dumping 
D) infant-industry 
E) bringing diversity and stability 
A) save domestic jobs 
B) national security 
C) anti-dumping 
D) infant-industry 
E) bringing diversity and stability

Question 19

When a country imports a good, the ________ in consumer surplus is ________ the ________ in producer surplus.

Accepted Answer

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

Question 20

-The above figure shows the U.S.market for wheat.With international trade, the price of wheat in the United States is ________ per ton and the United States ________ wheat.

Accepted Answer

A) $16; exports 
B) $14; exports 
C) $14; imports 
D) $16; imports 
E) $14; does not trade 
A) $16; exports 
B) $14; exports 
C) $14; imports 
D) $16; imports 
E) $14; does not trade

When a nation exports a good or service in which it has a comparative advantage, production of the good or service

When a nation exports a good, its total surplus , and when it imports a good, its total surplus .

A nation will import a good if its no-trade, domestic

How does a quota affect the domestic price of the import, the domestic consumption, the domestic production, and the quantity imported?

A tax on a good that is imposed when it is imported is called

With no international trade, the U.S.price of wheat is lower than the world price of wheat.This indicates that the United States a comparative advantage in the production of wheat and with international trade, the United States will wheat.

-The table above gives the domestic demand and supply schedules for a good.Suppose the world price of the good is $40 and the government imposes a $20 per unit tariff.How much will the government collect as tariff revenue?

Country A imports 1,000 cars per month.After imposing a $50 per car tariff, imports fall to 800 cars per month.How much does Country A's government collect in tariff revenue?

-The above figure shows the U.S.market for 1 carat diamonds.Suppose the United States imposes the import quota shown in the figure.With the import quota, how many diamonds can be imported?

The imposition of a quota domestic production, imports, and domestic purchases.

Of the following, who is harmed by a tariff?

A quota a deadweight loss and a tariff a deadweight loss.

International trade is definitely in the social interest if

The argument that it is necessary to protect a new industry to enable it to grow into a mature industry that can compete in world markets is known as the

-The difference between a tariff and a quota is that the revenue from the tariff goes to the

In the 1980s, the U.S.government forced Japanese automakers to limit their exports to the United States.The union representing the autoworkers (UAW), argued that otherwise the U.S.auto industry would have contracted.The UAW's argument is the ________ argument for protection.

When a country imports a good, the in consumer surplus is the in producer surplus.

-The above figure shows the U.S.market for wheat.With international trade, the price of wheat in the United States is per ton and the United States wheat.

Getting Started

The Usand Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Externalities

Public Goods and Common Resources

Markets With Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters

Exam 9: Global Markets in Action

When a nation exports a good or service in which it has a comparative advantage, production of the good or service

When a nation exports a good, its total surplus ________, and when it imports a good, its total surplus ________.

A nation will import a good if its no-trade, domestic

How does a quota affect the domestic price of the import, the domestic consumption, the domestic production, and the quantity imported?

A tax on a good that is imposed when it is imported is called

With no international trade, the U.S.price of wheat is lower than the world price of wheat.This indicates that the United States ________ a comparative advantage in the production of wheat and with international trade, the United States will ________ wheat.

-The table above gives the domestic demand and supply schedules for a good.Suppose the world price of the good is $40 and the government imposes a $20 per unit tariff.How much will the government collect as tariff revenue?

Country A imports 1,000 cars per month.After imposing a $50 per car tariff, imports fall to 800 cars per month.How much does Country A's government collect in tariff revenue?

-The above figure shows the U.S.market for 1 carat diamonds.Suppose the United States imposes the import quota shown in the figure.With the import quota, how many diamonds can be imported?

The imposition of a quota ________ domestic production, ________ imports, and ________ domestic purchases.

Of the following, who is harmed by a tariff?

A quota ________ a deadweight loss and a tariff ________ a deadweight loss.

International trade is definitely in the social interest if

The argument that it is necessary to protect a new industry to enable it to grow into a mature industry that can compete in world markets is known as the

-The difference between a tariff and a quota is that the revenue from the tariff goes to the

In the 1980s, the U.S.government forced Japanese automakers to limit their exports to the United States.The union representing the autoworkers (UAW), argued that otherwise the U.S.auto industry would have contracted.The UAW's argument is the ________ argument for protection.

When a country imports a good, the ________ in consumer surplus is ________ the ________ in producer surplus.

-The above figure shows the U.S.market for wheat.With international trade, the price of wheat in the United States is ________ per ton and the United States ________ wheat.

Getting Started

The Usand Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Externalities

Public Goods and Common Resources

Markets With Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters

When a nation exports a good, its total surplus , and when it imports a good, its total surplus .

With no international trade, the U.S.price of wheat is lower than the world price of wheat.This indicates that the United States a comparative advantage in the production of wheat and with international trade, the United States will wheat.

The imposition of a quota domestic production, imports, and domestic purchases.

A quota a deadweight loss and a tariff a deadweight loss.

When a country imports a good, the in consumer surplus is the in producer surplus.

-The above figure shows the U.S.market for wheat.With international trade, the price of wheat in the United States is per ton and the United States wheat.