Question 1

-Refer to Exhibit 34-5.Country 1 has a comparative advantage in the production of __________,and country 2 has a comparative advantage in the production of __________.

Accepted Answer

A)  good A; good B 
B)  good B; good A 
C)  both goods; neither good 
D)  neither good; both goods 
E)  neither good; neither good 
A)  good A; good B 
B)  good B; good A 
C)  both goods; neither good 
D)  neither good; both goods 
E)  neither good; neither good

Question 2

The act of selling goods abroad at a price below their cost and below the price charged in the domestic market is called

Accepted Answer

A)  dumping. 
B)  slumping. 
C)  export manipulation. 
D)  constraining. 
E)  none of the above 
A)  dumping. 
B)  slumping. 
C)  export manipulation. 
D)  constraining. 
E)  none of the above

Question 3

Which of the following conditions makes it most likely for a quota to be imposed?

Accepted Answer

A)  The benefits of the quota are spread over many and the costs are concentrated on a few. 
B)  The benefits of the quota are spread over many and the costs are spread over many. 
C)  The benefits of the quota are spread over few and the costs are spread over many. 
D)  The benefits of the quota are spread over few and the costs are spread over few. 
E)  There is not enough information to answer the question. 
A)  The benefits of the quota are spread over many and the costs are concentrated on a few. 
B)  The benefits of the quota are spread over many and the costs are spread over many. 
C)  The benefits of the quota are spread over few and the costs are spread over many. 
D)  The benefits of the quota are spread over few and the costs are spread over few. 
E)  There is not enough information to answer the question.

Question 4

7/20/2017 11:13 AM
Exhibit 34-11
  
-Refer to Exhibit 34-11.PW is the price that exists in the market before a tariff is imposed and PW + T is the price that exists in the market after a tariff is imposed.Tariff revenues equal the area

Accepted Answer

A)  DBCG. 
B)  EBCF. 
C)  CFG. 
D)  BCGE. 
E)  DBCF. 
A)  DBCG. 
B)  EBCF. 
C)  CFG. 
D)  BCGE. 
E)  DBCF.

Question 5

Raquel,who earns $900 a week,bought a television set and gained $70 consumers' surplus.What price did she pay for the good?

Accepted Answer

A)  $40 
B)  $830 
C)  $160 
D)  $5 
E)  There is not enough information to answer the question. 
A)  $40 
B)  $830 
C)  $160 
D)  $5 
E)  There is not enough information to answer the question.

Question 6

7/20/2017 11:13 AM
Exhibit 34-11
  
-Refer to Exhibit 34-11.A tariff raises the price in the market from PW to PW + T.As a result,U.S.domestic sales rise from __________.

Accepted Answer

A)  Q1 to Q4 
B)  Q3 to Q2 
C)  Q1 to Q3 
D)  Q4 to Q2 
E)  Q3 to Q4 
A)  Q1 to Q4 
B)  Q3 to Q2 
C)  Q1 to Q3 
D)  Q4 to Q2 
E)  Q3 to Q4

Question 7

The sale of goods abroad at a price below their cost and below the price charged in the domestic market is called

Accepted Answer

A)  priming. 
B)  coping. 
C)  invading. 
D)  dumping. 
A)  priming. 
B)  coping. 
C)  invading. 
D)  dumping.

Question 8

-Refer to Exhibit 34-1.Country B is the lower opportunity cost producer of

Accepted Answer

A)  good Y. 
B)  both goods. 
C)  neither good. 
D)  good X. 
A)  good Y. 
B)  both goods. 
C)  neither good. 
D)  good X.

Question 9

Suppose that a tariff is imposed on imported cheese.This will have the effect of __________ the quantity consumed of cheese,__________ consumers' surplus,and __________ the government's tariff revenues.

Accepted Answer

A)  increasing; increasing; increasing 
B)  decreasing; decreasing; increasing 
C)  increasing; decreasing; decreasing 
D)  decreasing; increasing; increasing 
E)  decreasing; increasing; decreasing 
A)  increasing; increasing; increasing 
B)  decreasing; decreasing; increasing 
C)  increasing; decreasing; decreasing 
D)  decreasing; increasing; increasing 
E)  decreasing; increasing; decreasing

Question 10

7/20/2017 11:13 AM
Exhibit 34-11
  
-Refer to Exhibit 34-11.PW is the price that exists in the market before a tariff is imposed and PW + T is the price that exists in the market after a tariff is imposed.As a result of the tariff,producers' surplus __________ by the area __________.

Accepted Answer

A)  rises; EBCF 
B)  falls; DBE 
C)  rises; FCG 
D)  falls; DBCG 
E)  none of the above 
A)  rises; EBCF 
B)  falls; DBE 
C)  rises; FCG 
D)  falls; DBCG 
E)  none of the above

Question 11

-Refer to Exhibit 34-6.The opportunity cost of 1 unit of cheese in terms of units of wine is __________ for country B.

Accepted Answer

A)  1 
B)  5 
C)  10 
D)  15 
A)  1 
B)  5 
C)  10 
D)  15

Question 12

The effects of a quota include:

Accepted Answer

A)  decreasing consumers' surplus. 
B)  increasing total revenue for the importers who sell the allowed number of imported units. 
C)  increasing producers' surplus. 
D)  b and c 
E)  a,b,and c 
A)  decreasing consumers' surplus. 
B)  increasing total revenue for the importers who sell the allowed number of imported units. 
C)  increasing producers' surplus. 
D)  b and c 
E)  a,b,and c

Question 13

-Refer to Exhibit 34-1.The opportunity cost of one unit of Y in country A is

Accepted Answer

A)  1 unit of X. 
B)  0.75 units of X. 
C)  2 units of X. 
D)  10 units of X. 
A)  1 unit of X. 
B)  0.75 units of X. 
C)  2 units of X. 
D)  10 units of X.

Question 14

It is necessary for government officials to analyze cost data to determine what their country should specialize in producing.

Accepted Answer

A) True 
 B)False

Question 15

7/20/2017 11:13 AM
Exhibit 34-11
  
-Refer to Exhibit 34-11.If the world price (PW)is operational in the market,then U.S.imports equal

Accepted Answer

A)  Q4 - Q2. 
B)  Q2 - Q3. 
C)  Q4 - Q3. 
D)  Q2 - Q1. 
E)  Q3 - Q1. 
A)  Q4 - Q2. 
B)  Q2 - Q3. 
C)  Q4 - Q3. 
D)  Q2 - Q1. 
E)  Q3 - Q1.

Question 16

Which of the following statements is false?

Accepted Answer

A)  Specialization and trade allow a country's inhabitants to consume at a level beyond its production possibilities frontier. 
B)  Some of the goods the U.S.exports include cars,coal,and wheat. 
C)  Some of the goods the U.S.imports include cars,oil,and coffee. 
D)  A country has a comparative advantage in producing that good it can produce at lower opportunity cost than another country. 
E)  none of the above 
A)  Specialization and trade allow a country's inhabitants to consume at a level beyond its production possibilities frontier. 
B)  Some of the goods the U.S.exports include cars,coal,and wheat. 
C)  Some of the goods the U.S.imports include cars,oil,and coffee. 
D)  A country has a comparative advantage in producing that good it can produce at lower opportunity cost than another country. 
E)  none of the above

Question 17

The answer is: "There is a net loss to society." What is the question?

Accepted Answer

A)  What causes the distributional effects to outweigh the aggregate effects? 
B)  What is an effect of a reduction in producers' surplus? 
C)  What is an effect of consumers' surplus? 
D)  What is the effect of a tariff instead of a quota? 
E)  none of the above 
A)  What causes the distributional effects to outweigh the aggregate effects? 
B)  What is an effect of a reduction in producers' surplus? 
C)  What is an effect of consumers' surplus? 
D)  What is the effect of a tariff instead of a quota? 
E)  none of the above

Question 18

The national defense argument has been used in the past to justify trade restrictions by firms in the peanut industry and the pottery industry.

Accepted Answer

A) True 
 B)False

Question 19

-Refer to Exhibit 34-2.The U.S.demand and supply for a good are shown.Under a policy of free trade,the world price is PW.If there is a policy change such that imports are prohibited,the price becomes PN, U.S.consumers are worse off if imports are __________; specifically,their consumers' surplus changes by area __________.

Accepted Answer

A)  prohibited; PWABD 
B)  permitted; PWDE 
C)  prohibited; PNBCPW 
D)  permitted; PN BDPW 
E)  none of the above 
A)  prohibited; PWABD 
B)  permitted; PWDE 
C)  prohibited; PNBCPW 
D)  permitted; PN BDPW 
E)  none of the above

Question 20

-Refer to Exhibit 34-9.For country Y,the opportunity cost of producing one unit of good A is __________ unit(s)of good B.

Accepted Answer

A)  1.5 
B)  2 
C)  1/2 
D)  2/3 
E)  10 
A)  1.5 
B)  2 
C)  1/2 
D)  2/3 
E)  10

Exam 21: International Finance

-Refer to Exhibit 34-5.Country 1 has a comparative advantage in the production of __________,and country 2 has a comparative advantage in the production of __________.

The act of selling goods abroad at a price below their cost and below the price charged in the domestic market is called

Which of the following conditions makes it most likely for a quota to be imposed?

7/20/2017 11:13 AM Exhibit 34-11 -Refer to Exhibit 34-11.PW is the price that exists in the market before a tariff is imposed and PW + T is the price that exists in the market after a tariff is imposed.Tariff revenues equal the area

Raquel,who earns $900 a week,bought a television set and gained $70 consumers' surplus.What price did she pay for the good?

7/20/2017 11:13 AM Exhibit 34-11 -Refer to Exhibit 34-11.A tariff raises the price in the market from PW to PW + T.As a result,U.S.domestic sales rise from __________.

The sale of goods abroad at a price below their cost and below the price charged in the domestic market is called

-Refer to Exhibit 34-1.Country B is the lower opportunity cost producer of

Suppose that a tariff is imposed on imported cheese.This will have the effect of __________ the quantity consumed of cheese,__________ consumers' surplus,and __________ the government's tariff revenues.

7/20/2017 11:13 AM Exhibit 34-11 -Refer to Exhibit 34-11.PW is the price that exists in the market before a tariff is imposed and PW + T is the price that exists in the market after a tariff is imposed.As a result of the tariff,producers' surplus __________ by the area __________.

-Refer to Exhibit 34-6.The opportunity cost of 1 unit of cheese in terms of units of wine is __________ for country B.

The effects of a quota include:

-Refer to Exhibit 34-1.The opportunity cost of one unit of Y in country A is

It is necessary for government officials to analyze cost data to determine what their country should specialize in producing.

7/20/2017 11:13 AM Exhibit 34-11 -Refer to Exhibit 34-11.If the world price (PW)is operational in the market,then U.S.imports equal

Which of the following statements is false?

The answer is: "There is a net loss to society." What is the question?

The national defense argument has been used in the past to justify trade restrictions by firms in the peanut industry and the pottery industry.

-Refer to Exhibit 34-9.For country Y,the opportunity cost of producing one unit of good A is __________ unit(s)of good B.

What Economics Is About

Production Possibilities Frontier Framework

Supply and Demand: Theory

Prices: Free,controlled,and Relative

Supply,demand,and Price: Applications

Elasticity

Consumer Choice: Maximizing Utility and Behavioral Economics

Production and Costs

Perfect Competition

Monopoly

Monopolistic Competition, oligopoly, and Game Theory

Government and Product Markets: Antitrust and Regulation

Factor Markets: With Emphasis on the Labor Market

Wages,union,and Labor

The Distribution of Income and Poverty

Interest,rent,and Profit

Market Failure: Externalities, public Goods, and Asymmetric Information

Public Choice and Special-Interest-Group Politics

Building Theories to Explain Everyday Life: From Observations to Questions to Theories to Predictions

International Trade

The Economic Case for and Against Government: Five Topics Considered

Stocks,bonds,futures,and Options

Stocks,bonds,futures,and Options

Filters

-Refer to Exhibit 34-5.Country 1 has a comparative advantage in the production of ,and country 2 has a comparative advantage in the production of .

7/20/2017 11:13 AM Exhibit 34-11 -Refer to Exhibit 34-11.P_W is the price that exists in the market before a tariff is imposed and P_{W + T} is the price that exists in the market after a tariff is imposed.Tariff revenues equal the area

7/20/2017 11:13 AM Exhibit 34-11 -Refer to Exhibit 34-11.A tariff raises the price in the market from P_W to P_{W + T}.As a result,U.S.domestic sales rise from __________.

Suppose that a tariff is imposed on imported cheese.This will have the effect of the quantity consumed of cheese, consumers' surplus,and __ the government's tariff revenues.

7/20/2017 11:13 AM Exhibit 34-11 -Refer to Exhibit 34-11.P_W is the price that exists in the market before a tariff is imposed and P_{W + T} is the price that exists in the market after a tariff is imposed.As a result of the tariff,producers' surplus by the area .

7/20/2017 11:13 AM Exhibit 34-11 -Refer to Exhibit 34-11.If the world price (P_W)is operational in the market,then U.S.imports equal