Question 1

When the dollar price of yen rises,the dollar appreciates in value relative to the yen.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following pairs of countries were admitted to the European Union in 2007?

Accepted Answer

A)  Croatia and Kosovo. 
B)  Romania and Bulgaria. 
C)  Switzerland and Hungary. 
D)  Tunisia and Liechtenstein. 
A)  Croatia and Kosovo. 
B)  Romania and Bulgaria. 
C)  Switzerland and Hungary. 
D)  Tunisia and Liechtenstein.

Question 3

A nation's true gain from international trade is:

Accepted Answer

A)  increased employment in export industries. 
B)  an overall increase in output obtained through specialization and exchange. 
C)  added technological knowledge. 
D)  the tariff revenue that goes to the national treasury. 
A)  increased employment in export industries. 
B)  an overall increase in output obtained through specialization and exchange. 
C)  added technological knowledge. 
D)  the tariff revenue that goes to the national treasury.

Question 4

Trade adjustment assistance:

Accepted Answer

A)  helps workers dislocated by international trade without erecting barriers that impede foreign trade. 
B)  subsidizes new firms trying to compete in international markets. 
C)  protects domestic jobs by reducing imports. 
D)  establishes a series of gradually loosened import quotas so that domestic firms have time to improve their international competitiveness or transition to new markets. 
A)  helps workers dislocated by international trade without erecting barriers that impede foreign trade. 
B)  subsidizes new firms trying to compete in international markets. 
C)  protects domestic jobs by reducing imports. 
D)  establishes a series of gradually loosened import quotas so that domestic firms have time to improve their international competitiveness or transition to new markets.

Question 5

American critics of the WTO argue that free international trade and investment will:

Accepted Answer

A)  reduce U.S.imports. 
B)  reduce employment in developing nations. 
C)  undermine environmental and labor protections in the United States. 
D)  increase immigration from low-income to high-income nations. 
A)  reduce U.S.imports. 
B)  reduce employment in developing nations. 
C)  undermine environmental and labor protections in the United States. 
D)  increase immigration from low-income to high-income nations.

Question 6

Protective tariffs are:

Accepted Answer

A)  maximum limits on the quantity or total value of specific products imported to a nation. 
B)  excise taxes or duties placed on imported products. 
C)  licensing requirements,unreasonable quality standards,and the like designed to impede imports. 
D)  government payments to domestic producers to reduce the world prices of exported goods. 
A)  maximum limits on the quantity or total value of specific products imported to a nation. 
B)  excise taxes or duties placed on imported products. 
C)  licensing requirements,unreasonable quality standards,and the like designed to impede imports. 
D)  government payments to domestic producers to reduce the world prices of exported goods.

Question 7

The "most-favored-nation" clause of reciprocal trade agreements:

Accepted Answer

A)  outlaws tariffs on products for which an exporting nation has a comparative advantage. 
B)  singles out a particular nation for exemption from an import quota. 
C)  means that any tariff reductions the United States negotiates with a specific nation will automatically apply to many other nations. 
D)  confers special trade privileges to nations in which the United States has military bases. 
A)  outlaws tariffs on products for which an exporting nation has a comparative advantage. 
B)  singles out a particular nation for exemption from an import quota. 
C)  means that any tariff reductions the United States negotiates with a specific nation will automatically apply to many other nations. 
D)  confers special trade privileges to nations in which the United States has military bases.

Question 8

Which of the following has not been a facilitating factor in world trade?

Accepted Answer

A)  Dramatic improvements in communications technology. 
B)  General declines in tariffs. 
C)  Import quotas. 
D)  Improvements in transportation technology. 
A)  Dramatic improvements in communications technology. 
B)  General declines in tariffs. 
C)  Import quotas. 
D)  Improvements in transportation technology.

Question 9

Nontariff barriers are:

Accepted Answer

A)  maximum limits on the quantity or total value of specific products imported to a nation. 
B)  excise taxes or duties placed on imported products. 
C)  licensing requirements,unreasonable quality standards,and the like designed to impede imports. 
D)  government payments to domestic producers to reduce the world prices of exported goods. 
A)  maximum limits on the quantity or total value of specific products imported to a nation. 
B)  excise taxes or duties placed on imported products. 
C)  licensing requirements,unreasonable quality standards,and the like designed to impede imports. 
D)  government payments to domestic producers to reduce the world prices of exported goods.

Question 10

The most-favored-nation clause in reciprocal trade agreements means that any tariff reductions the United States negotiates with a specific nation will automatically apply to many other nations.

Accepted Answer

A) True 
 B)False

Question 11

"Offshoring":

Accepted Answer

A)  is the movement of money to foreign bank accounts. 
B)  is the shifting of work previously done by domestic workers to workers located in other countries. 
C)  applies only to manufactured goods. 
D)  hurts all domestic industries in a country. 
A)  is the movement of money to foreign bank accounts. 
B)  is the shifting of work previously done by domestic workers to workers located in other countries. 
C)  applies only to manufactured goods. 
D)  hurts all domestic industries in a country.

Question 12

Most economists have concluded that fair-trade practices:

Accepted Answer

A)  distort market prices and wages in ways that encourage inefficient resource allocation. 
B)  raise the overall demand for labor and wages in low-wage nations. 
C)  increase overall labor productivity in low-wage nations. 
D)  do all of these things. 
A)  distort market prices and wages in ways that encourage inefficient resource allocation. 
B)  raise the overall demand for labor and wages in low-wage nations. 
C)  increase overall labor productivity in low-wage nations. 
D)  do all of these things.

Question 13

Answer the question on the basis of the following production possibilities tables for countries Alpha and Beta: Alpha Production Possibilities:

$\begin{array} { l c c c c } & \underline { \mathrm { A } } & \underline { \mathrm { B } }  & \underline { \mathrm { C } } & \underline{ \mathrm { D } } \ 
\text { Product } X & 3 & 2 & 1 & 0 \ \text { Product } Y & 0 & 4 & 8 & 12 \end{array}$

Beta Production Possibilities:

$\begin{array} { l c c c c } & \underline { \mathrm { A } }  & \underline { \mathrm { B } } & \underline { \mathrm { C } }  & \underline { \mathrm { D } } \
\text { Product } X  &6&4&2&0\
\text { Product } Y & 0 & 4 & 8 & 12 \end{array}$ Refer to the tables.Assume that before specialization both nations chose to produce alternative B.The gains from specialization and trade would be:

Accepted Answer

A)  2 units of X and 2 units of Y. 
B)  4 units of X. 
C)  4 units of Y. 
D)  6 units of X and 3 units of Y. 
A)  2 units of X and 2 units of Y. 
B)  4 units of X. 
C)  4 units of Y. 
D)  6 units of X and 3 units of Y.

Question 14

Which of the following concepts provides the basic rationale for international trade?

Accepted Answer

A)  Increasing opportunity costs. 
B)  Consumer sovereignty. 
C)  Comparative advantage. 
D)  The law of supply. 
A)  Increasing opportunity costs. 
B)  Consumer sovereignty. 
C)  Comparative advantage. 
D)  The law of supply.

Question 15

(Consider This)Madison,the CPA,is faster than Mason,the house painter,at both accounting services and painting.This means that:

Accepted Answer

A)  there is no reason for them to trade services. 
B)  Madison should trade her accounting services for Mason's painting services,so long as Madison is relatively more efficient at accounting services. 
C)  Madison should trade her accounting services for Mason's painting services,so long as Madison is relatively more efficient at painting. 
D)  Madison has the comparative advantage in both services. 
A)  there is no reason for them to trade services. 
B)  Madison should trade her accounting services for Mason's painting services,so long as Madison is relatively more efficient at accounting services. 
C)  Madison should trade her accounting services for Mason's painting services,so long as Madison is relatively more efficient at painting. 
D)  Madison has the comparative advantage in both services.

Question 16

Appreciation of the Mexican peso will:

Accepted Answer

A)  make Mexico's exports and imports both more expensive. 
B)  make Mexico's exports more expensive and its imports less expensive. 
C)  make Mexico's exports less expensive and its imports more expensive. 
D)  increase Mexican exports. 
A)  make Mexico's exports and imports both more expensive. 
B)  make Mexico's exports more expensive and its imports less expensive. 
C)  make Mexico's exports less expensive and its imports more expensive. 
D)  increase Mexican exports.

Question 17

The current,ongoing round of trade negotiations in the World Trade Organization is called the Doha Round.

Accepted Answer

A) True 
 B)False

Question 18

A nation has a comparative advantage in some product when it can produce that good at a lower domestic opportunity cost than can a potential trading partner.

Accepted Answer

A) True 
 B)False

Question 19

Specialized production and international trade increase a nation's productivity and increase the availability of goods and services.

Accepted Answer

A) True 
 B)False

Question 20

The building of a production plant in China by an American firm best illustrates a(n):

Accepted Answer

A)  trade flow. 
B)  resource flow. 
C)  financial flow. 
D)  information flow. 
A)  trade flow. 
B)  resource flow. 
C)  financial flow. 
D)  information flow.

When the dollar price of yen rises,the dollar appreciates in value relative to the yen.

Which of the following pairs of countries were admitted to the European Union in 2007?

A nation's true gain from international trade is:

Trade adjustment assistance:

American critics of the WTO argue that free international trade and investment will:

Protective tariffs are:

The "most-favored-nation" clause of reciprocal trade agreements:

Which of the following has not been a facilitating factor in world trade?

Nontariff barriers are:

The most-favored-nation clause in reciprocal trade agreements means that any tariff reductions the United States negotiates with a specific nation will automatically apply to many other nations.

"Offshoring":

Most economists have concluded that fair-trade practices:

Which of the following concepts provides the basic rationale for international trade?

(Consider This)Madison,the CPA,is faster than Mason,the house painter,at both accounting services and painting.This means that:

Appreciation of the Mexican peso will:

The current,ongoing round of trade negotiations in the World Trade Organization is called the Doha Round.

A nation has a comparative advantage in some product when it can produce that good at a lower domestic opportunity cost than can a potential trading partner.

Specialized production and international trade increase a nation's productivity and increase the availability of goods and services.

The building of a production plant in China by an American firm best illustrates a(n):

Income Inequality Poverty and Discrimination

Health Care

Immigration

An Introduction to Macroeconomics

Measuring Domestic Output and National Income

Economic Growth

Business Cycles, Unemployment, and Inflation

Basic Macroeconomic Relationships

The Aggregate Expenditures Model

Aggregate Demand and Aggregate Supply

The Balance of Payments, Exchange Rates, and Trade Deficits

Money, Banking, and Financial Institutions

Money Creation

Interest Rates and Monetary Policy

Financial Economics

Extending the Analysis of Aggregate Supply

Current Issues in Macro Theory and Policy

International Trade

The Balance of Payments, Exchange Rates, and Trade Deficits

The Economics of Developing Countries

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Exam 42: The United States and the Global Economy

When the dollar price of yen rises,the dollar appreciates in value relative to the yen.

Which of the following pairs of countries were admitted to the European Union in 2007?

A nation's true gain from international trade is:

Trade adjustment assistance:

American critics of the WTO argue that free international trade and investment will:

Protective tariffs are:

The "most-favored-nation" clause of reciprocal trade agreements:

Which of the following has not been a facilitating factor in world trade?

Nontariff barriers are:

The most-favored-nation clause in reciprocal trade agreements means that any tariff reductions the United States negotiates with a specific nation will automatically apply to many other nations.

"Offshoring":

Most economists have concluded that fair-trade practices:

Which of the following concepts provides the basic rationale for international trade?

(Consider This)Madison,the CPA,is faster than Mason,the house painter,at both accounting services and painting.This means that:

Appreciation of the Mexican peso will:

The current,ongoing round of trade negotiations in the World Trade Organization is called the Doha Round.

A nation has a comparative advantage in some product when it can produce that good at a lower domestic opportunity cost than can a potential trading partner.

Specialized production and international trade increase a nation's productivity and increase the availability of goods and services.

The building of a production plant in China by an American firm best illustrates a(n):

Income Inequality Poverty and Discrimination

Health Care

Immigration

An Introduction to Macroeconomics

Measuring Domestic Output and National Income

Economic Growth

Business Cycles, Unemployment, and Inflation

Basic Macroeconomic Relationships

The Aggregate Expenditures Model

Aggregate Demand and Aggregate Supply

The Balance of Payments, Exchange Rates, and Trade Deficits

Money, Banking, and Financial Institutions

Money Creation

Interest Rates and Monetary Policy

Financial Economics

Extending the Analysis of Aggregate Supply

Current Issues in Macro Theory and Policy

International Trade

The Balance of Payments, Exchange Rates, and Trade Deficits

The Economics of Developing Countries

Filters