Question 1

There are asymmetric incentives to support and to oppose protectionist trade policies, with the stronger incentives going to those that would seek protection.

Accepted Answer

A) True 
 B)False  True

Question 2

Australia has one of the most heavily subsidized agricultural sectors as a percentage of domestic GDP.

Accepted Answer

A) True 
 B)False  False

Question 3

Since there are diminishing returns to the removal of further trade barriers, economists do not favor further negotiations.

Accepted Answer

A) True 
 B)False  False

Question 4

U.S. sugar quotas cost each person in the U.S. thousands of dollars per year due to higher prices.

Accepted Answer

A) True 
 B)False

Question 5

Further trade opening is beneficial even if the monetary value of the gains is not high.

Accepted Answer

A) True 
 B)False

Question 6

Because low tariffs have a high ratio of benefits to costs, they are an especially efficient way for nations to achieve full employment and growth.

Accepted Answer

A) True 
 B)False

Question 7

If a large percentage of economic activity in developing countries is unrecorded, then the countries are likely to rely on which of the following taxes to provide government revenue?

Accepted Answer

A)  Sales taxes 
B)  Property taxes 
C)  Income taxes 
D)  Tariffs 
A)  Sales taxes 
B)  Property taxes 
C)  Income taxes 
D)  Tariffs

Question 8

Why is it difficult to determine whether a country is dumping? Explain fully.

Accepted Answer

According to the WTO rules, dumping occu

Question 9

Which of the following is an example escape clause relief?

Accepted Answer

A)  A tariff is granted because foreign firms are selling below cost. 
B)  A temporary tariff is granted to allow for adjustment of the domestic industry. 
C)  A tariff is granted to an industry because foreign firms are subsidized by their governments. 
D)  A tariff is granted to an industry because another nation persistently uses unfair trade practices. 
A)  A tariff is granted because foreign firms are selling below cost. 
B)  A temporary tariff is granted to allow for adjustment of the domestic industry. 
C)  A tariff is granted to an industry because foreign firms are subsidized by their governments. 
D)  A tariff is granted to an industry because another nation persistently uses unfair trade practices.

Question 10

During the 1990s, deadweight losses per job saved through tariffs and quotas in the apparel industry

Accepted Answer

A)  were greater than the wages earned in apparel jobs. 
B)  were small enough to ignore. 
C)  were less than the value of the jobs saved. 
D)  increased net national welfare. 
A)  were greater than the wages earned in apparel jobs. 
B)  were small enough to ignore. 
C)  were less than the value of the jobs saved. 
D)  increased net national welfare.

Question 11

Antidumping duties cannot be levied when the harm to domestic industries is very small.

Accepted Answer

A) True 
 B)False

Question 12

Historically, one of the most common reasons for countries to impose tariffs was

Accepted Answer

A)  to protect their national security. 
B)  to raise revenue for the government. 
C)  to eliminate unemployment. 
D)  to counter inflation. 
A)  to protect their national security. 
B)  to raise revenue for the government. 
C)  to eliminate unemployment. 
D)  to counter inflation.

Question 13

Describe traditional knowledge and how it relates to current trade issues about intellectual property rights protection.

Accepted Answer

Traditional knowledge is often embedded

Question 14

Predatory dumping occurs when

Accepted Answer

A)  foreign firms sell below cost with the intent to drive firms out of the domestic market. 
B)  foreign firms sell below cost because the product is perishable. 
C)  foreign firms sell at a price that is below the price of domestic firms. 
D)  foreign firms sell at a price that covers the cost of their variable inputs. 
A)  foreign firms sell below cost with the intent to drive firms out of the domestic market. 
B)  foreign firms sell below cost because the product is perishable. 
C)  foreign firms sell at a price that is below the price of domestic firms. 
D)  foreign firms sell at a price that covers the cost of their variable inputs.

Question 15

One reason why producers have an incentive to organize in favor of protection is because

Accepted Answer

A)  producer gains are spread across so many firms that no one gets a large share of the benefits. 
B)  producer gains are relatively concentrated. 
C)  there is no real cost to the economy. 
D)  producer gains outweigh consumer losses. 
A)  producer gains are spread across so many firms that no one gets a large share of the benefits. 
B)  producer gains are relatively concentrated. 
C)  there is no real cost to the economy. 
D)  producer gains outweigh consumer losses.

Question 16

Which of the following is an example of a countervailing duty?

Accepted Answer

A)  A tariff is granted because foreign firms are selling below cost. 
B)  A temporary tariff is granted to allow for adjustment of the domestic industry. 
C)  A tariff is granted to an industry because foreign firms are subsidized by their governments. 
D)  A tariff is granted to an industry because another nation persistently uses unfair trade practices. 
A)  A tariff is granted because foreign firms are selling below cost. 
B)  A temporary tariff is granted to allow for adjustment of the domestic industry. 
C)  A tariff is granted to an industry because foreign firms are subsidized by their governments. 
D)  A tariff is granted to an industry because another nation persistently uses unfair trade practices.

Question 17

Direct subsidies to agriculture, whether they are export subsidies or production subsides, are viewed as harmful because of all the following reasons EXCEPT

Accepted Answer

A)  they lead to overproduction. 
B)  they crowd out imports. 
C)  they can lead to dumping of surplus production. 
D)  they encourage overconsumption through low market prices. 
A)  they lead to overproduction. 
B)  they crowd out imports. 
C)  they can lead to dumping of surplus production. 
D)  they encourage overconsumption through low market prices.

Question 18

Which of the following is NOT a True statement?

Accepted Answer

A)  Trade barriers are usually a good way of protecting jobs. 
B)  There have been significant reductions in trade barriers over the last 60 years. 
C)  Economists generally favor further reductions in trade barriers. 
D)  There are diminishing returns to trade negotiations. 
A)  Trade barriers are usually a good way of protecting jobs. 
B)  There have been significant reductions in trade barriers over the last 60 years. 
C)  Economists generally favor further reductions in trade barriers. 
D)  There are diminishing returns to trade negotiations.

Question 19

Agricultural subsidies are known to cause overproduction and create other problems. Are there benefits from such subsidies? Explain.

Accepted Answer

Subsidies given by high-income countries

Question 20

Explain how potential gains from further reductions in tariff levels are different from the gains of the past.

Accepted Answer

It is likely that tariff cuts have dimin

There are asymmetric incentives to support and to oppose protectionist trade policies, with the stronger incentives going to those that would seek protection.

Australia has one of the most heavily subsidized agricultural sectors as a percentage of domestic GDP.

Since there are diminishing returns to the removal of further trade barriers, economists do not favor further negotiations.

U.S. sugar quotas cost each person in the U.S. thousands of dollars per year due to higher prices.

Further trade opening is beneficial even if the monetary value of the gains is not high.

Because low tariffs have a high ratio of benefits to costs, they are an especially efficient way for nations to achieve full employment and growth.

If a large percentage of economic activity in developing countries is unrecorded, then the countries are likely to rely on which of the following taxes to provide government revenue?

Why is it difficult to determine whether a country is dumping? Explain fully.

Which of the following is an example escape clause relief?

During the 1990s, deadweight losses per job saved through tariffs and quotas in the apparel industry

Antidumping duties cannot be levied when the harm to domestic industries is very small.

Historically, one of the most common reasons for countries to impose tariffs was

Describe traditional knowledge and how it relates to current trade issues about intellectual property rights protection.

Predatory dumping occurs when

One reason why producers have an incentive to organize in favor of protection is because

Which of the following is an example of a countervailing duty?

Direct subsidies to agriculture, whether they are export subsidies or production subsides, are viewed as harmful because of all the following reasons EXCEPT

Which of the following is NOT a True statement?

Agricultural subsidies are known to cause overproduction and create other problems. Are there benefits from such subsidies? Explain.

Explain how potential gains from further reductions in tariff levels are different from the gains of the past.

The United States in a Global Economy

International Economic Institutions Since World War II

Comparative Advantage and the Gains From Trade

Comparative Advantage and Factor Endowments

Beyond Comparative Advantage

The Theory of Tariffs and Quotas

International Trade and Labor and Environmental Standards

Trade and the Balance of Payments

Exchange Rates and Exchange Rate Systems

An Introduction to Open Economy Macroeconomics

International Financial Crises

The United States in the World Economy

The European Union: Many Markets Into One

Trade and Policy Reform in Latin America

Export-Oriented Growth in East Asia

China and India in the World Economy

Filters

Exam 7: Commercial Policy

There are asymmetric incentives to support and to oppose protectionist trade policies, with the stronger incentives going to those that would seek protection.

Australia has one of the most heavily subsidized agricultural sectors as a percentage of domestic GDP.

Since there are diminishing returns to the removal of further trade barriers, economists do not favor further negotiations.

U.S. sugar quotas cost each person in the U.S. thousands of dollars per year due to higher prices.

Further trade opening is beneficial even if the monetary value of the gains is not high.

Because low tariffs have a high ratio of benefits to costs, they are an especially efficient way for nations to achieve full employment and growth.

If a large percentage of economic activity in developing countries is unrecorded, then the countries are likely to rely on which of the following taxes to provide government revenue?

Why is it difficult to determine whether a country is dumping? Explain fully.

Which of the following is an example escape clause relief?

During the 1990s, deadweight losses per job saved through tariffs and quotas in the apparel industry

Antidumping duties cannot be levied when the harm to domestic industries is very small.

Historically, one of the most common reasons for countries to impose tariffs was

Describe traditional knowledge and how it relates to current trade issues about intellectual property rights protection.

Predatory dumping occurs when

One reason why producers have an incentive to organize in favor of protection is because

Which of the following is an example of a countervailing duty?

Direct subsidies to agriculture, whether they are export subsidies or production subsides, are viewed as harmful because of all the following reasons EXCEPT

Which of the following is NOT a True statement?

Agricultural subsidies are known to cause overproduction and create other problems. Are there benefits from such subsidies? Explain.

Explain how potential gains from further reductions in tariff levels are different from the gains of the past.

The United States in a Global Economy

International Economic Institutions Since World War II

Comparative Advantage and the Gains From Trade

Comparative Advantage and Factor Endowments

Beyond Comparative Advantage

The Theory of Tariffs and Quotas

International Trade and Labor and Environmental Standards

Trade and the Balance of Payments

Exchange Rates and Exchange Rate Systems

An Introduction to Open Economy Macroeconomics

International Financial Crises

The United States in the World Economy

The European Union: Many Markets Into One

Trade and Policy Reform in Latin America

Export-Oriented Growth in East Asia

China and India in the World Economy

Filters