Exam 10: International Trade

Below is production possibilities data for the countries of Mental and Etheric. -Refer to the information above to answer this question.In which product should Etheric specialize and export?

Figure 10.10 shows the market for cloth in Smith Island. -Refer to Figure 10.10 to answer this question.If Smith Island introduced an import quota of 20,what would be the new price of cloth in Smith Island?

-Refer to above figure to answer this question.What do the comparative opportunity costs in the two countries suggest?

Below is some hypothetical data for the countries of Canada and Mexico.(Assume that Canada has 10 million workers per month available and Mexico has 20 million. ) Canada's Production Possibilities (Output in millions of bushels per month) Mexico's Production Possibilities (Output in millions of bushels per month) Output Before Trade (Output in millions of bushels per month) -Refer to the information above to answer this question.What is the output per worker in Canada in the rye and bean industries respectively?

Suppose that originally the average price of Happy Island's exports was 180,and the average price of its imports was 120.Now,the price of its exports drops to 160,and the price of its imports drops to 100.What effect will this have on Happy Island's terms of trade?

Suppose the following domestic demand and supply schedule for Mexico's toothpaste industry: a)In the absence of free trade,what is the equilibrium price and quantity traded domestically for Mexico's toothpaste industry? b)Suppose the international price for a toothpaste is 1 peso.Will Mexico export or import toothpaste? How many units? Now suppose the international price is 0.75 peso. c)If the Mexican government limits the number of imported toothpaste to 1 million units.How many units will Mexico import and what will be the equilibrium price? d)If the Mexican government places a 0.10 peso tariff on toothpaste.How many units will Thailand import?

Below is the productivity per worker (kilos per day)in the wheat and bean industries of Caledonia and Ibrox.The working population in each country is 16 million people. -Refer to the data above to answer this question.If each country is self-sufficient in the two products and each employs half of its working population in each industry,what is the total combined output that they are capable of producing?

Below is the total market demand and supply of wine for France and Germany.Quantities are in millions of litres per month. -Refer to the information above to answer this question.Assume that France and Germany enter into a free trade agreement (and there are no extra transportation costs,etc. )what will France do?

Below is production possibilities data for the countries of Mental and Etheric. -Which of the following would cause the terms of trade to move in favour of Canada?

What is a tariff?

-Refer to above table to answer this question.Supposing that there are 200 workers in Rings,how many broomsticks could be produced if 200 swords were produced?

Suppose the following demand and supply schedule for Canada's tire industry: a)In the absence of free trade,what is the equilibrium price and quantity traded for Canada's tire industry? Suppose the international price for a computer is $60. b)Will Canadian consumers benefit? Explain. c)Will Canadian producers benefit? Explain

The terms of trade relate to the laws and conditions that govern trade.

Some commentators have suggested that the government should not allow American universities to operate in Canada.Which argument against free trade is being suggested?

Below is some hypothetical data for the countries of Canada and Mexico.(Assume that Canada has 10 million workers per month available and Mexico has 20 million. ) Canada's Production Possibilities (Output in millions of bushels per month) Mexico's Production Possibilities (Output in millions of bushels per month) Output Before Trade (Output in millions of bushels per month) -Refer to the information above to answer this question.What is the output per worker in Mexico in the rye and bean industries respectively?

Below is production possibilities data for the countries of Mental and Etheric. -What is the formula for the terms of trade?

What is a tariff?

Below is a graph illustrating rice and flax production in the countries of Cardassia and Bajor. -Refer to the graph above to answer this question.What is the opportunity cost of 100 tons of rice in Bajor?

Below are the production possibilities (without trade)and the trading possibilities (with free trade)for Canada. -Refer to the graph above to answer this question.Assuming free trade,what is the opportunity cost of 1 more aircraft?

What is the meant by the terms of trade?