Question 1

Which of the following statements is true?

Accepted Answer

A)  International trade raises wages in developing countries. 
B)  International trade with reach industrial countries forces people in the developing countries to work for lower wages. 
C)  International trade leads to job losses in both import competing industries and exporting industries. 
D)  Unlike other types of international trade, offshoring does not bring any gains from trade. 
A)  International trade raises wages in developing countries. 
B)  International trade with reach industrial countries forces people in the developing countries to work for lower wages. 
C)  International trade leads to job losses in both import competing industries and exporting industries. 
D)  Unlike other types of international trade, offshoring does not bring any gains from trade.

Question 2

Which of the following is an effective counter argument to the claim that protectionism saves domestic jobs?

Accepted Answer

A)  Protectionism eliminates domestic jobs in export industries. 
B)  Imports create jobs in this country for people selling and servicing imported items. 
C)  The cost of saving domestic jobs through protectionism may be high. 
D)  all of the above 
A)  Protectionism eliminates domestic jobs in export industries. 
B)  Imports create jobs in this country for people selling and servicing imported items. 
C)  The cost of saving domestic jobs through protectionism may be high. 
D)  all of the above

Question 3

In 2013 the United States reduced the tariff on ethanol.The winners from the tariff reduction are

Accepted Answer

A)  U.S. producers and the U.S. government. 
B)  U.S. producers only. 
C)  U.S. consumers only. 
D)  U.S. consumers, U.S. producers, and the U.S. government. 
A)  U.S. producers and the U.S. government. 
B)  U.S. producers only. 
C)  U.S. consumers only. 
D)  U.S. consumers, U.S. producers, and the U.S. government.

Question 4

In 2013 the United States was considering imposing a tariff on solar panels imported from China.Which of the following groups would gain from this tariff?
I. U.S.consumers of solar panels
II. U.S.producers of solar panels
III. Chinese producers of solar panels

Accepted Answer

A)  I only. 
B)  I and II only. 
C)  II only. 
D)  I and III only. 
A)  I only. 
B)  I and II only. 
C)  II only. 
D)  I and III only.

Question 5

The figure shows the market for helicopters in the United States, where D is the domestic demand curve and S is the domestic supply curve. The United States trades helicopters with the rest of the world at a price of $36 million per helicopter.
-In the figure above,the United States ________ helicopters per year.

Accepted Answer

A)  exports 480 
B)  exports 720 
C)  imports 480 
D)  imports 240 
A)  exports 480 
B)  exports 720 
C)  imports 480 
D)  imports 240

Question 6

As a result of an increase in tariffs,imports decrease and government revenue increases.

Accepted Answer

A) True 
 B)False

Question 7

Increasing a tariff will ________ the domestic quantity consumed of the good,while ________ the domestic production of the good.

Accepted Answer

A)  increase; increasing 
B)  increase; decreasing 
C)  decrease; increasing 
D)  decrease; decreasing 
A)  increase; increasing 
B)  increase; decreasing 
C)  decrease; increasing 
D)  decrease; decreasing

Question 8

When does the domestic government gain the MOST revenue?

Accepted Answer

A)  when it imposes a tariff 
B)  when it imposes an import quota 
C)  when it negotiates a voluntary export restraint 
D)  The amount of revenue it gains is the same with a tariff and a voluntary export restraint. 
A)  when it imposes a tariff 
B)  when it imposes an import quota 
C)  when it negotiates a voluntary export restraint 
D)  The amount of revenue it gains is the same with a tariff and a voluntary export restraint.

Question 9

A major purpose of tariffs is to

Accepted Answer

A)  encourage imports. 
B)  encourage exports. 
C)  discourage imports. 
D)  discourage exports. 
A)  encourage imports. 
B)  encourage exports. 
C)  discourage imports. 
D)  discourage exports.

Question 10

Most economists agree that valid reasons for protecting trade include which of the following?
I. The economies of scale argument.
II. The saving jobs argument.
III. The protection of high wages argument.

Accepted Answer

A)  I only 
B)  I and II 
C)  I and III 
D)  None of the reasons are valid. 
A)  I only 
B)  I and II 
C)  I and III 
D)  None of the reasons are valid.

Question 11

Tariffs and import quotas differ in that

Accepted Answer

A)  one is a form of trade restriction, while the other is not. 
B)  one is a tax, while the other is a limit. 
C)  one is imposed by the government, while the other is imposed by the private sector. 
D)  one is legal, while the other is not. 
A)  one is a form of trade restriction, while the other is not. 
B)  one is a tax, while the other is a limit. 
C)  one is imposed by the government, while the other is imposed by the private sector. 
D)  one is legal, while the other is not.

Question 12

In 2007,European Union (EU) negotiators have offered to cut tariffs for Latin American bananas to avoid "banana wars." What are the effects of a cut in tariffs?

Accepted Answer

A)  The quantity of bananas imported into the EU will increase. 
B)  The price of bananas for consumers will increase. 
C)  The quantity of bananas produced in the EU (such as in France and Spain) will increase. 
D)  Tariff revenue will increase. 
A)  The quantity of bananas imported into the EU will increase. 
B)  The price of bananas for consumers will increase. 
C)  The quantity of bananas produced in the EU (such as in France and Spain) will increase. 
D)  Tariff revenue will increase.

Question 13

In developing countries,there is more reliance on ________ as opposed to ________ for government revenue.

Accepted Answer

A)  tariffs; tax collection 
B)  quotas; tariffs 
C)  tax collection; tariffs 
D)  tariffs; quotas 
A)  tariffs; tax collection 
B)  quotas; tariffs 
C)  tax collection; tariffs 
D)  tariffs; quotas

Question 14

In a market open to international trade,at the world price the quantity demanded is 150 and quantity supplied is 200. This country will

Accepted Answer

A)  export 50 units. 
B)  import 50 units. 
C)  export 200 units. 
D)  import 150 units. 
A)  export 50 units. 
B)  import 50 units. 
C)  export 200 units. 
D)  import 150 units.

Question 15

Lowering the tariff on good X will

Accepted Answer

A)  increase domestic employment in industry X. 
B)  increase the domestic imports of good X. 
C)  increase the domestic price of good X. 
D)  have no effect unless the nation's trading partner also lowers its tariff on good X. 
A)  increase domestic employment in industry X. 
B)  increase the domestic imports of good X. 
C)  increase the domestic price of good X. 
D)  have no effect unless the nation's trading partner also lowers its tariff on good X.

Question 16

A tariff imposed by the United States on Japanese cars ________ the price of cars in the United States and ________ the quantity of Japanese cars imported into the United States.

Accepted Answer

A)  raises; increases 
B)  raises; decreases 
C)  lowers; increases 
D)  lowers; decreases 
A)  raises; increases 
B)  raises; decreases 
C)  lowers; increases 
D)  lowers; decreases

Question 17

During the first 6 months of 2008,the United States imported from Africa,Asia,and Latin America more than 1.6 billion pounds of coffee and did not export any coffee. How is the gain from imports distributed between consumers and domestic producers?

Accepted Answer

A)  U.S. producers are harmed and U.S. consumers are harmed. 
B)  U.S. producers are harmed and U.S. consumers are helped. 
C)  U.S. producers are helped and U.S. consumers are harmed., 
D)  U.S. producers are harmed and U.S. consumers are helped., 
A)  U.S. producers are harmed and U.S. consumers are harmed. 
B)  U.S. producers are harmed and U.S. consumers are helped. 
C)  U.S. producers are helped and U.S. consumers are harmed., 
D)  U.S. producers are harmed and U.S. consumers are helped.,

Question 18

If the United States imposes a tariff on imported steel,the tariff will

Accepted Answer

A)  raise the U.S. price of imported steel. 
B)  decrease the U.S. production of steel. 
C)  increase the total U.S. consumption of steel. 
D)  decrease employment in the U.S. steel industry. 
A)  raise the U.S. price of imported steel. 
B)  decrease the U.S. production of steel. 
C)  increase the total U.S. consumption of steel. 
D)  decrease employment in the U.S. steel industry.

Question 19

Currently,the United States has a quota on the amount of sugar that is allowed to be imported into the United States.What would happen to the price of sugar in the United States if the quota was removed?
What would happen to U.S.consumption and U.S.production of sugar?

Accepted Answer

If the quota is removed,the pr

Question 20

________ occurs when a foreign firm sells its exports at a lower price than it costs to produce the goods.

Accepted Answer

A)  Dumping 
B)  Comparative advantage 
C)  Learning-by-doing 
D)  A tariff 
A)  Dumping 
B)  Comparative advantage 
C)  Learning-by-doing 
D)  A tariff

Which of the following statements is true?

Which of the following is an effective counter argument to the claim that protectionism saves domestic jobs?

In 2013 the United States reduced the tariff on ethanol.The winners from the tariff reduction are

In 2013 the United States was considering imposing a tariff on solar panels imported from China.Which of the following groups would gain from this tariff? I. U.S.consumers of solar panels II. U.S.producers of solar panels III. Chinese producers of solar panels

As a result of an increase in tariffs,imports decrease and government revenue increases.

Increasing a tariff will the domestic quantity consumed of the good,while the domestic production of the good.

When does the domestic government gain the MOST revenue?

A major purpose of tariffs is to

Most economists agree that valid reasons for protecting trade include which of the following? I. The economies of scale argument. II. The saving jobs argument. III. The protection of high wages argument.

Tariffs and import quotas differ in that

In 2007,European Union (EU) negotiators have offered to cut tariffs for Latin American bananas to avoid "banana wars." What are the effects of a cut in tariffs?

In developing countries,there is more reliance on as opposed to for government revenue.

In a market open to international trade,at the world price the quantity demanded is 150 and quantity supplied is 200. This country will

Lowering the tariff on good X will

A tariff imposed by the United States on Japanese cars the price of cars in the United States and the quantity of Japanese cars imported into the United States.

During the first 6 months of 2008,the United States imported from Africa,Asia,and Latin America more than 1.6 billion pounds of coffee and did not export any coffee. How is the gain from imports distributed between consumers and domestic producers?

If the United States imposes a tariff on imported steel,the tariff will

Currently,the United States has a quota on the amount of sugar that is allowed to be imported into the United States.What would happen to the price of sugar in the United States if the quota was removed? What would happen to U.S.consumption and U.S.production of sugar?

________ occurs when a foreign firm sells its exports at a lower price than it costs to produce the goods.

What Is Economics

The Economic Problem

Demand and Supply

Measuring GDP and Economic Growth

Monitoring Jobs and Inflation

Economic Growth

Finance, Saving, and Investment

Money, The Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers

Inflation, Jobs, and the Business Cycle

Fiscal Policy

Monetary Policy

Introduction

Monitoring Macroeconomic Performance

Macroeconomic Trends

Macroeconomic Fluctuations

Macroeconomic Policy

Filters

Exam 15: International Trade Policy

Which of the following statements is true?

Which of the following is an effective counter argument to the claim that protectionism saves domestic jobs?

In 2013 the United States reduced the tariff on ethanol.The winners from the tariff reduction are

In 2013 the United States was considering imposing a tariff on solar panels imported from China.Which of the following groups would gain from this tariff? I. U.S.consumers of solar panels II. U.S.producers of solar panels III. Chinese producers of solar panels

As a result of an increase in tariffs,imports decrease and government revenue increases.

Increasing a tariff will ________ the domestic quantity consumed of the good,while ________ the domestic production of the good.

When does the domestic government gain the MOST revenue?

A major purpose of tariffs is to

Most economists agree that valid reasons for protecting trade include which of the following? I. The economies of scale argument. II. The saving jobs argument. III. The protection of high wages argument.

Tariffs and import quotas differ in that

In 2007,European Union (EU) negotiators have offered to cut tariffs for Latin American bananas to avoid "banana wars." What are the effects of a cut in tariffs?

In developing countries,there is more reliance on ________ as opposed to ________ for government revenue.

In a market open to international trade,at the world price the quantity demanded is 150 and quantity supplied is 200. This country will

Lowering the tariff on good X will

A tariff imposed by the United States on Japanese cars ________ the price of cars in the United States and ________ the quantity of Japanese cars imported into the United States.

During the first 6 months of 2008,the United States imported from Africa,Asia,and Latin America more than 1.6 billion pounds of coffee and did not export any coffee. How is the gain from imports distributed between consumers and domestic producers?

If the United States imposes a tariff on imported steel,the tariff will

Currently,the United States has a quota on the amount of sugar that is allowed to be imported into the United States.What would happen to the price of sugar in the United States if the quota was removed? What would happen to U.S.consumption and U.S.production of sugar?

________ occurs when a foreign firm sells its exports at a lower price than it costs to produce the goods.

What Is Economics

The Economic Problem

Demand and Supply

Measuring GDP and Economic Growth

Monitoring Jobs and Inflation

Economic Growth

Finance, Saving, and Investment

Money, The Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers

Inflation, Jobs, and the Business Cycle

Fiscal Policy

Monetary Policy

Introduction

Monitoring Macroeconomic Performance

Macroeconomic Trends

Macroeconomic Fluctuations

Macroeconomic Policy

Filters

Increasing a tariff will the domestic quantity consumed of the good,while the domestic production of the good.

In developing countries,there is more reliance on as opposed to for government revenue.

A tariff imposed by the United States on Japanese cars the price of cars in the United States and the quantity of Japanese cars imported into the United States.