Question 1

Figure 10.10 shows the market for cloth in Smith Island.
  
-Refer to Figure 10.10 to answer this question.At the world price,how much is Smith Island trading?

Accepted Answer

A) It is importing 30 units. 
B) It is importing 40 units. 
C) It is exporting 30 units. 
D) It is exporting 40 units. 
A) It is importing 30 units. 
B) It is importing 40 units. 
C) It is exporting 30 units. 
D) It is exporting 40 units.

Question 2

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 opportunity cost of 1 bushel of beans in Canada?

Accepted Answer

A) 0.67 bushels of rye. 
B) 1.5 bushels of rye. 
C) 6 bushels of rye. 
D) 12 bushels of rye. 
E) 75 bushels of rye. 
A) 0.67 bushels of rye. 
B) 1.5 bushels of rye. 
C) 6 bushels of rye. 
D) 12 bushels of rye. 
E) 75 bushels of rye.

Question 3

Below is production possibilities data for the countries of Mental and Etheric.
  
-Refer to the information above to answer this question.What is the opportunity cost of one unit of soya milk in Mental?

Accepted Answer

A) 0.5 units of rice cakes. 
B) 0.75 units of rice cakes. 
C) 2 units of rice cakes. 
D) 5 units of rice cakes. 
E) 10 units of rice cakes. 
A) 0.5 units of rice cakes. 
B) 0.75 units of rice cakes. 
C) 2 units of rice cakes. 
D) 5 units of rice cakes. 
E) 10 units of rice cakes.

Question 4

What is the term for a limit which is imposed on the production or sale of a product?

Accepted Answer

A) Protectionism. 
B) Trade barrier. 
C) Quota. 
D) Tariff. 
A) Protectionism. 
B) Trade barrier. 
C) Quota. 
D) Tariff.

Question 5

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 opportunity cost of 1 bushel of beans in Mexico?

Accepted Answer

A) 0.5 bushels of rye. 
B) 1 bushels of rye. 
C) 2 bushels of rye. 
D) 6 bushels of rye. 
E) 10 bushels of rye. 
A) 0.5 bushels of rye. 
B) 1 bushels of rye. 
C) 2 bushels of rye. 
D) 6 bushels of rye. 
E) 10 bushels of rye.

Question 6

Suppose that the productivity per worker in the crude oil and natural gas industries of Westland and Eastland are as follows:
   a)Which country has the absolute advantage in producing crude oil?
b)Which country has the absolute advantage in producing natural gas?
c)Which country has the comparative advantage in producing crude oil?
d)Which country has the comparative advantage in producing natural gas?
e)According to the theory of comparative advantage,will there be trade? If yes,what is the direction of trade?

Accepted Answer

a)Westland has the absolute advantage in

Question 7

List four arguments against free trade.

Accepted Answer

The strategic industry argument suggests

Figure 10.10 shows the market for cloth in Smith Island. -Refer to Figure 10.10 to answer this question.At the world price,how much is Smith Island trading?

Below is production possibilities data for the countries of Mental and Etheric. -Refer to the information above to answer this question.What is the opportunity cost of one unit of soya milk in Mental?

What is the term for a limit which is imposed on the production or sale of a product?

List four arguments against free trade.

The Economic Problem

Demand and Supply: an Introduction

Measuring the Economy 1: GDP and Economic Growth

Measuring the Economy 2: Unemployment and Inflation

Aggregate Demand and Supply

Aggregate Expenditures

Fiscal Policy

Money and Banking

The Money Market and Monetary Policy

Exchange Rates and the Balance of Payments

Macroeconomic Policy Revisited

A Walk Through the Twentieth Century and Beyond

Filters

Exam 10: International Trade

Figure 10.10 shows the market for cloth in Smith Island. -Refer to Figure 10.10 to answer this question.At the world price,how much is Smith Island trading?

Below is production possibilities data for the countries of Mental and Etheric. -Refer to the information above to answer this question.What is the opportunity cost of one unit of soya milk in Mental?

What is the term for a limit which is imposed on the production or sale of a product?

List four arguments against free trade.

The Economic Problem

Demand and Supply: an Introduction

Measuring the Economy 1: GDP and Economic Growth

Measuring the Economy 2: Unemployment and Inflation

Aggregate Demand and Supply

Aggregate Expenditures

Fiscal Policy

Money and Banking

The Money Market and Monetary Policy

Exchange Rates and the Balance of Payments

Macroeconomic Policy Revisited

A Walk Through the Twentieth Century and Beyond

Filters