Exam 19: Comparative Advantage, International Trade, and Exchange Rates

Table 19-12 Output per hour Production and Production of work Consumption without Trade with Trade Swords Belts Swords Belts Swords Belts Estonia 5 3 100 40 200 0 Morocco 2 2 60 60 0 120 Estonia and Morocco can produce both swords and belts. Each country has a total of 40 available labor hours for the production of swords and belts. Table 19-12 shows the output per hour of work, the production and consumption quantities without trade, and the production numbers with trade. -Refer to Table 19-12.If the actual terms of trade are 1 belt for 1.5 swords and 50 belts are traded,how many swords will Morocco gain compared to the "without trade" numbers?

Figure 19-4 Figure 19-4 shows the U.S. demand and supply for leather footwear. -Refer to Figure 19-4.Suppose the government allows imports of leather footwear into the United States.What will be the domestic quantity supplied?

Which of the following statements about the importance of trade to the U.S.economy is false?

In the real world,we don't observe countries completely specializing in the production of goods for which they have a comparative advantage.One reasons for this is

If the dollar appreciates,how will aggregate demand in the United States be affected?

A tariff is a tax imposed by a government on imports.

Absolute advantage is

Which of the following countries is not one of the top three exporting countries in the world?

If Canada imports fishing poles from Mexico and Mexico imports bacon from Canada,which of the following would explain this pattern of trade?

In international exchange markets,a rise in interest rates in the United States will cause the demand for dollars to ________ and the supply of dollars to ________.

Which of the following statements about the importance of trade to the U.S.economy is true?

Table 19-12 Output per hour Production and Production of work Consumption without Trade with Trade Swords Belts Swords Belts Swords Belts Estonia 5 3 100 40 200 0 Morocco 2 2 60 60 0 120 Estonia and Morocco can produce both swords and belts. Each country has a total of 40 available labor hours for the production of swords and belts. Table 19-12 shows the output per hour of work, the production and consumption quantities without trade, and the production numbers with trade. -Refer to Table 19-12.What is the opportunity cost to produce 1 belt in Morocco?

Figure 19-6 Suppose the U.S. government imposes a $0.50 per pound tariff on sugar imports. Figure 19-6 shows the demand and supply curves for sugar and the impact of this tariff. -Use Figure 19-6 to answer questions a-i. a.Following the imposition of the tariff,what is the price that domestic consumers must now pay and what is the quantity purchased? b.Calculate the value of consumer surplus with the tariff in place. c.What is the quantity supplied by domestic sugar producers with the tariff in place? d.Calculate the value of producer surplus received by U.S.sugar producers with the tariff in place. e.What is the quantity of sugar imported with the tariff in place? f.What is the amount of tariff revenue collected by the government? g.The tariff has reduced consumer surplus.Calculate the loss in consumer surplus due to the tariff. h.What portion of the consumer surplus loss is redistributed to domestic producers? To the government? i.Calculate the deadweight loss due to the tariff.

A consequence of increasing marginal costs of producing digital music players in Japan is

Figure 19-10 -Refer to Figure 19-10.The French fall in love with California wines and triple their purchases of this beverage.Assuming all else remains constant,this would be represented as a movement from

Table 19-10 Pens Pencils Tran 40 160 Farah 50 150 Table 19-10 shows the output per week for pens and pencils by Tran and Farah. -Refer to Table 19-10.Fill in the following table with the opportunity costs of producing bows and arrows for Tran and Farah. Pens Pencils Tran Farah

A numerical limit imposed by a government on the quantity of a good that can be imported into the country is called a

Table 19-12 Output per hour Production and Production of work Consumption without Trade with Trade Swords Belts Swords Belts Swords Belts Estonia 5 3 100 40 200 0 Morocco 2 2 60 60 0 120 Estonia and Morocco can produce both swords and belts. Each country has a total of 40 available labor hours for the production of swords and belts. Table 19-12 shows the output per hour of work, the production and consumption quantities without trade, and the production numbers with trade. -Refer to Table 19-12.Which country has a comparative advantage in producing swords?

Table 19-6 Saddles Spurs (pairs) Mateo 75 225 Celeste 100 225 Mateo and Celeste produce custom saddles and spurs. Table 19-6 lists the number of saddles and pairs of spurs Mateo and Celeste can each produce in one month. -Refer to Table 19-6.Select the statement that accurately interprets the data in the table.

Table 19-1 Bathing Grooming Linda 60 20 Sandy 50 25 Linda and Sandy own The Preppy Puppy, a dog grooming business. Table 19-1 lists the number of dogs Linda and Sandy can each bathe and groom in one week. -Refer to Table 19-1.Select the statement that accurately interprets the data in the table.