Question 1

Daily Output of Scotland and Poland
   
Table 18.1
-Refer to Table 18.1.Scotland has a comparative advantage in

Accepted Answer

A)  accordions. 
B)  bagpipes. 
C)  both accordions and bagpipes. 
D)  neither accordions nor bagpipes. 
A)  accordions. 
B)  bagpipes. 
C)  both accordions and bagpipes. 
D)  neither accordions nor bagpipes.

Question 2

Voluntary export restraints are illegal under WTO rules.

Accepted Answer

A) True 
 B)False

Question 3

Among the problems associated with subsidizing an industry in the hope of establishing a worldwide monopoly is that if two nations subsidize firms in the same industry,each could lose money.

Accepted Answer

A) True 
 B)False

Question 4

The GATT was initiated in 1947 by the United States and how many other countries?

Accepted Answer

A)  13 
B)  23 
C)  40 
D)  147 
A)  13 
B)  23 
C)  40 
D)  147

Question 5

Daily Output of Scotland and Poland
   
Table 18.1
-Refer to Table 18.1.The nation with a comparative advantage in bagpipes is

Accepted Answer

A)  both Scotland and Poland. 
B)  neither Scotland nor Poland. 
C)  Poland. 
D)  Scotland. 
A)  both Scotland and Poland. 
B)  neither Scotland nor Poland. 
C)  Poland. 
D)  Scotland.

Question 6

If the U.S.government imposes an import ban on German made cars,then

Accepted Answer

A)  no German made cars can enter the United States. 
B)  any German made car after a certain predetermined number is not allowed. 
C)  no German made car can enter the United States without being taxed. 
D)  any German made car after a certain predetermined number is taxed. 
A)  no German made cars can enter the United States. 
B)  any German made car after a certain predetermined number is not allowed. 
C)  no German made car can enter the United States without being taxed. 
D)  any German made car after a certain predetermined number is taxed.

Question 7

Which of the following statements is true?

Accepted Answer

A)  Free trade will benefit all workers in a nation equally. 
B)  As a result of specialization some workers will be displaced and hence, harmed by free trade. 
C)  Free trade leads to lower wages for all workers in both nations. 
D)  Specialization will result in a decline in an industry and none of those workers will be able to find other jobs. 
A)  Free trade will benefit all workers in a nation equally. 
B)  As a result of specialization some workers will be displaced and hence, harmed by free trade. 
C)  Free trade leads to lower wages for all workers in both nations. 
D)  Specialization will result in a decline in an industry and none of those workers will be able to find other jobs.

Question 8

Daily Output of Scotland and Poland
   
Table 18.1
-Refer to Table 18.1.The nation with a comparative advantage in accordions is

Accepted Answer

A)  both Scotland and Poland. 
B)  neither Scotland nor Poland. 
C)  Poland. 
D)  Scotland. 
A)  both Scotland and Poland. 
B)  neither Scotland nor Poland. 
C)  Poland. 
D)  Scotland.

Question 9

Figure 18.1
-Refer to Figure 18.1.In autarky,the maximum amount of umbrellas that Duckland can produce is

Accepted Answer

A)  40. 
B)  50. 
C)  100. 
D)  150. 
A)  40. 
B)  50. 
C)  100. 
D)  150.

Question 10

Do most infant industries become as efficient as their international competition?

Accepted Answer

A)  No. This rarely happens. 
B)  Yes, but only if they get very large protection. 
C)  Yes, it always happens. 
D)  Yes, but only after decades of protection. 
A)  No. This rarely happens. 
B)  Yes, but only if they get very large protection. 
C)  Yes, it always happens. 
D)  Yes, but only after decades of protection.

Question 11

If France can produce grapes at a lower opportunity cost than any other nation,France is said to have a(n)________ in the production of grapes.

Accepted Answer

A)  autarky 
B)  absolute advantage 
C)  comparative disadvantage 
D)  comparative advantage 
A)  autarky 
B)  absolute advantage 
C)  comparative disadvantage 
D)  comparative advantage

Question 12

Figure 18.5
-In Figure 18.5,compared to free trade,the tariff causes domestic production of the good to

Accepted Answer

A)  increase by Q₂-Q₁. 
B)  decrease by Q₂-Q₁. 
C)  increase by Q₅-Q₄. 
D)  decrease by Q₅-Q₄. 
A)  increase by Q₂-Q₁. 
B)  decrease by Q₂-Q₁. 
C)  increase by Q₅-Q₄. 
D)  decrease by Q₅-Q₄.

Question 13

Daily Output of Japan and United States
   
Table 18.2
-Refer to Table 18.2.The opportunity cost of a tractor in Japan is

Accepted Answer

A)  1/4 of a stereo. 
B)  1/2 of a stereo. 
C)  2 stereos. 
D)  4 stereos. 
A)  1/4 of a stereo. 
B)  1/2 of a stereo. 
C)  2 stereos. 
D)  4 stereos.

Question 14

Suppose Nation A produces only two goods,apples and oranges.If Nation A produces only apples,it can make 12 apples per day.If Nation A produces only oranges,it can make 36 oranges per day.If the country has a constant production trade-off between apples and oranges,then the opportunity cost of one orange in Nation A is

Accepted Answer

A)  0.33 apples. 
B)  3 apples. 
C)  12 apples. 
D)  36 apples. 
A)  0.33 apples. 
B)  3 apples. 
C)  12 apples. 
D)  36 apples.

Question 15

A possible reason a nation might impose a protectionist policy such as a tariff is to

Accepted Answer

A)  help firms establish a world monopoly in a particular market. 
B)  increase the level of imports. 
C)  encourage specialization in the good in which the nation has a comparative advantage. 
D)  increase the welfare of domestic consumers. 
A)  help firms establish a world monopoly in a particular market. 
B)  increase the level of imports. 
C)  encourage specialization in the good in which the nation has a comparative advantage. 
D)  increase the welfare of domestic consumers.

Question 16

The WTO and GATT promote trade by

Accepted Answer

A)  reducing tariffs. 
B)  directing trade. 
C)  setting the prices of goods sold internationally. 
D)  all of the above 
A)  reducing tariffs. 
B)  directing trade. 
C)  setting the prices of goods sold internationally. 
D)  all of the above

Question 17

Recall the Application about the impact Chinese imports have on U.S. labor markets to answer the following question(s).
-According to the Application,what effects of the Chinese imports were advantageous to local communities,but are usually not included in the study done by Autor,Dorn,and Hanson?

Accepted Answer

A)  lower prices for consumers 
B)  improved U.S.-China relations 
C)  a stronger local currency 
D)  more export opportunities for U.S. producers 
A)  lower prices for consumers 
B)  improved U.S.-China relations 
C)  a stronger local currency 
D)  more export opportunities for U.S. producers

Question 18

The opportunity cost of a table is 5 chairs in Nation A and 4 chairs in Nation B.If the countries specialize and trade,an acceptable terms of trade for both countries would be 3 chairs per table.

Accepted Answer

A) True 
 B)False

Question 19

Figure 18.2
-Refer to Figure 18.2.Pizzaland has a comparative advantage in the production of

Accepted Answer

A)  tomatoes. 
B)  cheese. 
C)  both cheese and tomatoes. 
D)  neither cheese nor tomatoes. 
A)  tomatoes. 
B)  cheese. 
C)  both cheese and tomatoes. 
D)  neither cheese nor tomatoes.

Question 20

Dumping is sometimes legal under international trade agreements.

Accepted Answer

A) True 
 B)False

Daily Output of Scotland and Poland Table 18.1 -Refer to Table 18.1.Scotland has a comparative advantage in

Voluntary export restraints are illegal under WTO rules.

Among the problems associated with subsidizing an industry in the hope of establishing a worldwide monopoly is that if two nations subsidize firms in the same industry,each could lose money.

The GATT was initiated in 1947 by the United States and how many other countries?

Daily Output of Scotland and Poland Table 18.1 -Refer to Table 18.1.The nation with a comparative advantage in bagpipes is

If the U.S.government imposes an import ban on German made cars,then

Which of the following statements is true?

Daily Output of Scotland and Poland Table 18.1 -Refer to Table 18.1.The nation with a comparative advantage in accordions is

Figure 18.1 -Refer to Figure 18.1.In autarky,the maximum amount of umbrellas that Duckland can produce is

Do most infant industries become as efficient as their international competition?

If France can produce grapes at a lower opportunity cost than any other nation,France is said to have a(n)________ in the production of grapes.

Figure 18.5 -In Figure 18.5,compared to free trade,the tariff causes domestic production of the good to

Daily Output of Japan and United States Table 18.2 -Refer to Table 18.2.The opportunity cost of a tractor in Japan is

A possible reason a nation might impose a protectionist policy such as a tariff is to

The WTO and GATT promote trade by

Recall the Application about the impact Chinese imports have on U.S. labor markets to answer the following question(s). -According to the Application,what effects of the Chinese imports were advantageous to local communities,but are usually not included in the study done by Autor,Dorn,and Hanson?

The opportunity cost of a table is 5 chairs in Nation A and 4 chairs in Nation B.If the countries specialize and trade,an acceptable terms of trade for both countries would be 3 chairs per table.

Figure 18.2 -Refer to Figure 18.2.Pizzaland has a comparative advantage in the production of

Dumping is sometimes legal under international trade agreements.

Introduction: What Is Economics

The Key Principles of Economics

Exchange and Markets

Demand,supply,and Market Equilibrium

Elasticity: a Measure of Responsiveness

Market Efficiency and Government Intervention

Consumer Choice: Utility Theory and Insights From Neuroscience

Production Technology and Cost

Perfect Competition

Monopoly and Price Discrimination

Market Entry and Monopolistic Competition

Oligopoly and Strategic Behavior

Controlling Market Power: Antitrust and Regulation

Imperfect Information: Adverse Selection and Moral Hazard

Public Goods and Public Choice

External Costs and Environmental Policy

The Labor Market and the Distribution of Income

Filters

Exam 18: International Trade and Public Policy

Daily Output of Scotland and Poland Table 18.1 -Refer to Table 18.1.Scotland has a comparative advantage in

Voluntary export restraints are illegal under WTO rules.

Among the problems associated with subsidizing an industry in the hope of establishing a worldwide monopoly is that if two nations subsidize firms in the same industry,each could lose money.

The GATT was initiated in 1947 by the United States and how many other countries?

Daily Output of Scotland and Poland Table 18.1 -Refer to Table 18.1.The nation with a comparative advantage in bagpipes is

If the U.S.government imposes an import ban on German made cars,then

Which of the following statements is true?

Daily Output of Scotland and Poland Table 18.1 -Refer to Table 18.1.The nation with a comparative advantage in accordions is

Figure 18.1 -Refer to Figure 18.1.In autarky,the maximum amount of umbrellas that Duckland can produce is

Do most infant industries become as efficient as their international competition?

If France can produce grapes at a lower opportunity cost than any other nation,France is said to have a(n)________ in the production of grapes.

Figure 18.5 -In Figure 18.5,compared to free trade,the tariff causes domestic production of the good to

Daily Output of Japan and United States Table 18.2 -Refer to Table 18.2.The opportunity cost of a tractor in Japan is

A possible reason a nation might impose a protectionist policy such as a tariff is to

The WTO and GATT promote trade by

Recall the Application about the impact Chinese imports have on U.S. labor markets to answer the following question(s). -According to the Application,what effects of the Chinese imports were advantageous to local communities,but are usually not included in the study done by Autor,Dorn,and Hanson?

The opportunity cost of a table is 5 chairs in Nation A and 4 chairs in Nation B.If the countries specialize and trade,an acceptable terms of trade for both countries would be 3 chairs per table.

Figure 18.2 -Refer to Figure 18.2.Pizzaland has a comparative advantage in the production of

Dumping is sometimes legal under international trade agreements.

Introduction: What Is Economics

The Key Principles of Economics

Exchange and Markets

Demand,supply,and Market Equilibrium

Elasticity: a Measure of Responsiveness

Market Efficiency and Government Intervention

Consumer Choice: Utility Theory and Insights From Neuroscience

Production Technology and Cost

Perfect Competition

Monopoly and Price Discrimination

Market Entry and Monopolistic Competition

Oligopoly and Strategic Behavior

Controlling Market Power: Antitrust and Regulation

Imperfect Information: Adverse Selection and Moral Hazard

Public Goods and Public Choice

External Costs and Environmental Policy

The Labor Market and the Distribution of Income

Filters