Exam 15: International Trade and Trade Policy

The following graph shows the production possibilities curve for the economy with only two members, Silvia and Art. Silvia can produce either 50 pounds of beef or 2 computers per week, and Art can produce 100 pounds of beef or 1 computer per week. Both of them work 40 weeks per year. Silvia has a comparative advantage in producing ________, and Art has a comparative advantage in producing ________.

What is the price of cars if this were a closed economy?

The accompanying figure shows the annual production possibilities curve for a small country that is open to trade with the rest of the world. Suppose the world price of cashews is $12 per pound, and the world price of mangos is $4 per pound. As indicated in the figure, at these prices, this country will produce 21,000 pounds of mangos and 5,000 pounds of cashews each year. Suppose that the residents of this country are allergic to cashews and only want to consume mangos. Given that this country is open to trade with the rest of the world, how many mangos in total can its residents consume each year?

One means of enforcing a quota is to require importers to ________.

The amount of revenue the government collects after imposing the tariff is ________.

The following graph shows the production possibilities curve for the economy with only two members, Silvia and Art. Silvia can produce either 50 pounds of beef or 2 computers per week, and Art can produce 100 pounds of beef or 1 computer per week. Both of them work 40 weeks per year. Silvia's opportunity cost of producing one pound of beef is ________ computer(s).

If Fredonia has a closed economy, it ________ with other countries.

What is the amount of tariff imposed on a ton of sugar?

Taiwan exports tools to the United States. Consumers in Taiwan will probably pay a(n)________ price for tools with free trade than they would with a closed economy.

An economy has two workers, Paula and Ricardo. Every day they work, Paula can produce 4 computers or 16 shirts, and Ricardo can produce 6 computers or 12 shirts. What is the opportunity cost for Paula to produce one computer?

If this is a closed economy, the number of TVs exchanged will be ________.

What is the domestic price of sugar in a closed economy?

Suppose this economy is currently closed. ________ is/are most likely to want open trade, and ________ is/are most likely to oppose opening the economy to trade.

In an open economy, the quantity demanded of bikes in the domestic market is ________.

Refer to the following graph. If this country is producing between point G and Q, it will gain by ________ its production of good A and importing more ________.

In an open economy, the quantity supplied of TVs in the domestic market will be ________.

Opening this economy to trade would benefit ________ and harm ________.

If a country is a net importer of a good, domestic suppliers will supply ________ of that good after it opens itself to international trade.

If a country is net exporter, free trade will hurt the ________.

Amy can produce either 5,000 pounds of cheese or 20 cars per year. Mike can produce either 5,000 pounds of cheese or 10 cars per year. Mike's opportunity cost of producing one car is ________ pound(s)of cheese.