Question 1

International trade decreases the demand for workers in domestic industries that

Accepted Answer

A)  produce goods that are exported from the country. 
B)  produce goods that also are imported into the country. 
C)  help businesses import and export. 
D)  service imported goods. 
E)  produce the goods in which the nation has a comparative advantage. 
A)  produce goods that are exported from the country. 
B)  produce goods that also are imported into the country. 
C)  help businesses import and export. 
D)  service imported goods. 
E)  produce the goods in which the nation has a comparative advantage.

Question 2

In the 1950s, crude oil and natural gas imports were restricted to keep the domestic industries viable in case of a war.The rationale for this protection is the ________ argument for protection.

Accepted Answer

A)  save domestic jobs 
B)  national security 
C)  anti-dumping 
D)  infant-industry 
E)  penalizing lax environmental standards 
A)  save domestic jobs 
B)  national security 
C)  anti-dumping 
D)  infant-industry 
E)  penalizing lax environmental standards

Question 3

The national security argument is used by those who assert they want to

Accepted Answer

A)  increase imports as a way of strengthening their country. 
B)  increase exports as a way of earning money to strengthen their country. 
C)  limit imports that compete with domestic producers important for national defense. 
D)  limit exports to control the flow of technology to third world nations. 
E)  limit all imports. 
A)  increase imports as a way of strengthening their country. 
B)  increase exports as a way of earning money to strengthen their country. 
C)  limit imports that compete with domestic producers important for national defense. 
D)  limit exports to control the flow of technology to third world nations. 
E)  limit all imports.

Question 4

How can a nation and its producers determine whether or not it has a comparative advantage in producing a particular good or service?

Accepted Answer

Whether a nation has a comparative advan

Question 5

-The above figure shows the U.S.market for replacement cell phone batteries. The U.S.government collects tariff revenue of ________ on each battery imported.

Accepted Answer

A)  $4 
B)  $14 
C)  $12 
D)  $6 
E)  $2 
A)  $4 
B)  $14 
C)  $12 
D)  $6 
E)  $2

Question 6

-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 ________.

Accepted Answer

A)  $12; $14 
B)  $500; $300 
C)  $14; $12 
D)  $700; $300 
E)  $500; $700 
A)  $12; $14 
B)  $500; $300 
C)  $14; $12 
D)  $700; $300 
E)  $500; $700

Question 7

-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 8

Most t-shirts bought by Americans are made in Asia.Producers in Asia making t-shirts trade with America because they

Accepted Answer

A)  receive a lower price than they would receive from another buyer. 
B)  receive a higher price than they would receive from another buyer. 
C)  must export something to the United States. 
D)  cannot produce enough t-shirts for their own domestic consumption. 
E)  cannot lower their price any lower and still make a profit. 
A)  receive a lower price than they would receive from another buyer. 
B)  receive a higher price than they would receive from another buyer. 
C)  must export something to the United States. 
D)  cannot produce enough t-shirts for their own domestic consumption. 
E)  cannot lower their price any lower and still make a profit.

Question 9

When a country exports a good because the world price is higher than the no-trade domestic price, domestic purchases of the good ________ and domestic production of the good ________.

Accepted Answer

A)  increase; increases 
B)  increase; decreases 
C)  decrease; increases 
D)  decrease; decreases 
E)  do not change; increases 
A)  increase; increases 
B)  increase; decreases 
C)  decrease; increases 
D)  decrease; decreases 
E)  do not change; increases

Question 10

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 11

-The figure above shows the U.S.demand and U.S.supply curves for cherries.At a world price of $2 per pound, the production of cherries in the United States will equal

Accepted Answer

A)  200,000 pounds. 
B)  400,000 pounds. 
C)  600,000 pounds. 
D)  800,000 pounds. 
E)  0 pounds. 
A)  200,000 pounds. 
B)  400,000 pounds. 
C)  600,000 pounds. 
D)  800,000 pounds. 
E)  0 pounds.

Question 12

-The above figure shows the U.S.market for flip-flops. With international trade, the United States imports ________ flip-flops.

Accepted Answer

A)  300,000 
B)  500,000 
C)  700,000 
D)  0 because the United States exports flip-flops 
E)  400,000 
A)  300,000 
B)  500,000 
C)  700,000 
D)  0 because the United States exports flip-flops 
E)  400,000

Question 13

-The above figure shows the U.S.market for 1 carat diamonds. With free trade, Americans buy ________ diamonds and pay a price of ________ per diamond.

Accepted Answer

A)  500,000; $4,000 
B)  300,000; $3,000 
C)  700,000; $3,000 
D)  300,000; $4,000 
E)  900,000; $2,000 
A)  500,000; $4,000 
B)  300,000; $3,000 
C)  700,000; $3,000 
D)  300,000; $4,000 
E)  900,000; $2,000

Question 14

-The above figure shows the U.S.market for replacement cell phone batteries. Area A + area E is the

Accepted Answer

A)  consumer surplus when there is a tariff. 
B)  producer surplus when there is a tariff. 
C)  tariff revenue. 
D)  increase in producer surplus due to the tariff. 
E)  gain in total surplus due to the tariff. 
A)  consumer surplus when there is a tariff. 
B)  producer surplus when there is a tariff. 
C)  tariff revenue. 
D)  increase in producer surplus due to the tariff. 
E)  gain in total surplus due to the tariff.

Question 15

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

Accepted Answer

A)  exports 300,000 batteries. 
B)  imports 400,000 batteries. 
C)  imports 500,000 batteries. 
D)  imports 800,000 batteries. 
E)  exports 700,000 batteries. 
A)  exports 300,000 batteries. 
B)  imports 400,000 batteries. 
C)  imports 500,000 batteries. 
D)  imports 800,000 batteries. 
E)  exports 700,000 batteries.

Question 16

Explain how governments restrict international trade and who benefits as well as who loses from the restrictions.

Accepted Answer

Governments use tariffs and nontariff ba

Question 17

A tariff makes the total economy

Accepted Answer

A)  better off because it increases the domestic production of the good. 
B)  better off because it decreases the deadweight loss from international trade. 
C)  worse off because it creates a deadweight loss. 
D)  worse off because it creates revenue for the government. 
E)  worse off because it decreases both domestic consumer surplus and domestic producer surplus. 
A)  better off because it increases the domestic production of the good. 
B)  better off because it decreases the deadweight loss from international trade. 
C)  worse off because it creates a deadweight loss. 
D)  worse off because it creates revenue for the government. 
E)  worse off because it decreases both domestic consumer surplus and domestic producer surplus.

Question 18

What is rent seeking with respect to restricting international trade?

Accepted Answer

A)  The rent on factory buildings increases if trade is restricted. 
B)  The government avoids paying rent on buildings when importers pay the tariff. 
C)  An attempt to capture the gains from trade by imposing a tariff. 
D)  The government's efforts to capture tariff rents. 
E)  The attempt by importers to avoid paying a tariff. 
A)  The rent on factory buildings increases if trade is restricted. 
B)  The government avoids paying rent on buildings when importers pay the tariff. 
C)  An attempt to capture the gains from trade by imposing a tariff. 
D)  The government's efforts to capture tariff rents. 
E)  The attempt by importers to avoid paying a tariff.

Question 19

How does the United States attempt to compensate losers from lower trade restrictions?

Accepted Answer

The U.S.government attempts to compensat

Question 20

Of the following, ________ accounts for the largest share of imports into the United States.

Accepted Answer

A)  food and drinks 
B)  fuels 
C)  crude oil 
D)  semiconductors 
E)  chemicals 
A)  food and drinks 
B)  fuels 
C)  crude oil 
D)  semiconductors 
E)  chemicals

International trade decreases the demand for workers in domestic industries that

In the 1950s, crude oil and natural gas imports were restricted to keep the domestic industries viable in case of a war.The rationale for this protection is the ________ argument for protection.

The national security argument is used by those who assert they want to

How can a nation and its producers determine whether or not it has a comparative advantage in producing a particular good or service?

-The above figure shows the U.S.market for replacement cell phone batteries. The U.S.government collects tariff revenue of ________ on each battery imported.

-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 .

-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?

Most t-shirts bought by Americans are made in Asia.Producers in Asia making t-shirts trade with America because they

When a country exports a good because the world price is higher than the no-trade domestic price, domestic purchases of the good and domestic production of the good .

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

-The figure above shows the U.S.demand and U.S.supply curves for cherries.At a world price of $2 per pound, the production of cherries in the United States will equal

-The above figure shows the U.S.market for flip-flops. With international trade, the United States imports ________ flip-flops.

-The above figure shows the U.S.market for 1 carat diamonds. With free trade, Americans buy diamonds and pay a price of per diamond.

-The above figure shows the U.S.market for replacement cell phone batteries. Area A + area E is the

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

Explain how governments restrict international trade and who benefits as well as who loses from the restrictions.

A tariff makes the total economy

What is rent seeking with respect to restricting international trade?

How does the United States attempt to compensate losers from lower trade restrictions?

Of the following, ________ accounts for the largest share of imports into the United States.

Getting Started

The Usand Global Economies

The Economic Problem

Demand and Supply

Gdp: a Measure of Total Production and Income

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and the Natural Unemployment Rate

Economic Growth

Finance, Saving, and Investment

The Monetary System

Money, Interest, and Inflation

Aggregate Supply and Aggregate Demand

Aggregate Expenditure Multiplier

The Short-Run Policy Tradeoff

Fiscal Policy

Monetary Policy

International Finance

Filters

Exam 18: International Trade Policy

International trade decreases the demand for workers in domestic industries that

In the 1950s, crude oil and natural gas imports were restricted to keep the domestic industries viable in case of a war.The rationale for this protection is the ________ argument for protection.

The national security argument is used by those who assert they want to

How can a nation and its producers determine whether or not it has a comparative advantage in producing a particular good or service?

-The above figure shows the U.S.market for replacement cell phone batteries. The U.S.government collects tariff revenue of ________ on each battery imported.

-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 ________.

-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?

Most t-shirts bought by Americans are made in Asia.Producers in Asia making t-shirts trade with America because they

When a country exports a good because the world price is higher than the no-trade domestic price, domestic purchases of the good ________ and domestic production of the good ________.

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

-The figure above shows the U.S.demand and U.S.supply curves for cherries.At a world price of $2 per pound, the production of cherries in the United States will equal

-The above figure shows the U.S.market for flip-flops. With international trade, the United States imports ________ flip-flops.

-The above figure shows the U.S.market for 1 carat diamonds. With free trade, Americans buy ________ diamonds and pay a price of ________ per diamond.

-The above figure shows the U.S.market for replacement cell phone batteries. Area A + area E is the

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

Explain how governments restrict international trade and who benefits as well as who loses from the restrictions.

A tariff makes the total economy

What is rent seeking with respect to restricting international trade?

How does the United States attempt to compensate losers from lower trade restrictions?

Of the following, ________ accounts for the largest share of imports into the United States.

Getting Started

The Usand Global Economies

The Economic Problem

Demand and Supply

Gdp: a Measure of Total Production and Income

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and the Natural Unemployment Rate

Economic Growth

Finance, Saving, and Investment

The Monetary System

Money, Interest, and Inflation

Aggregate Supply and Aggregate Demand

Aggregate Expenditure Multiplier

The Short-Run Policy Tradeoff

Fiscal Policy

Monetary Policy

International Finance

Filters

-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 country exports a good because the world price is higher than the no-trade domestic price, domestic purchases of the good and domestic production of the good .

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

-The above figure shows the U.S.market for 1 carat diamonds. With free trade, Americans buy diamonds and pay a price of per diamond.