Question 1

If Indonesia has lower wage rates than India, trade between these two nations will make India worse off.

Accepted Answer

A) True 
 B)False

Question 2

Use the following to answer questions :
Figure: The Market for Roses  
-(Figure: The Market for Roses) Look at the figure The Market for Roses. Assume that PA is the autarky price and PW is the world price. Consumer surplus without international trade would be area:

Accepted Answer

A) W + X + Y. 
B) Z. 
C) W + X + Z. 
D) W. 
A) W + X + Y. 
B) Z. 
C) W + X + Z. 
D) W.

Question 3

Use the following to answer questions :
Figure: The Market for Tea in Sri Lanka  
-When an economy moves from autarky to free international trade, for industries in the export sector, consumer surplus _____, producer surplus _____, and the economy as a whole _____.

Accepted Answer

A) rises; rises; gains 
B) rises; falls; gains 
C) falls; rises; gains 
D) falls; rises; loses 
A) rises; rises; gains 
B) rises; falls; gains 
C) falls; rises; gains 
D) falls; rises; loses

Question 4

In autarky, the amount of a country's production and consumption of a good must be identical.

Accepted Answer

A) True 
 B)False

Question 5

A tariff imposed on U.S. imports into Japan tends to _____ U.S. producers and _____ Japanese producers.

Accepted Answer

A) penalize; benefit 
B) benefit; penalize 
C) penalize; penalize 
D) benefit; benefit 
A) penalize; benefit 
B) benefit; penalize 
C) penalize; penalize 
D) benefit; benefit

Question 6

The term autarky refers to a country that:

Accepted Answer

A) trades goods and services based upon the principle of comparative advantage. 
B) trades goods and services based upon the principle of absolute advantage. 
C) trades goods and services based upon the principle of Ricardian advantage. 
D) does not trade with other countries. 
A) trades goods and services based upon the principle of comparative advantage. 
B) trades goods and services based upon the principle of absolute advantage. 
C) trades goods and services based upon the principle of Ricardian advantage. 
D) does not trade with other countries.

Question 7

If a country's price for wood furniture in the absence of trade is lower than the price with trade, the country will likely:

Accepted Answer

A) import wooden furniture. 
B) export wooden furniture. 
C) have absolute advantage in wooden furniture production. 
D) have a surplus of wooden furniture. 
A) import wooden furniture. 
B) export wooden furniture. 
C) have absolute advantage in wooden furniture production. 
D) have a surplus of wooden furniture.

Question 8

If a country has the comparative advantage in producing cloth, in the market for cloth the autarky price would be _____ the world price and the country would _____ cloth.

Accepted Answer

A) less than; export 
B) greater than; export 
C) less than; import 
D) the same as; export 
A) less than; export 
B) greater than; export 
C) less than; import 
D) the same as; export

Question 9

Use the following to answer questions :
Figure: The Market for Melons in Russia  
-(Figure: The Markets for Melons in Russia) Look at the figure The Market for Melons in Russia. If the world price of melons is equal to E, Russia will _____ of melons.

Accepted Answer

A) import I - H 
B) export I - H 
C) import G - F 
D) export G - F 
A) import I - H 
B) export I - H 
C) import G - F 
D) export G - F

Question 10

Use the following to answer questions:
Figure: The Market for Calculators  
-(Figure: The Market for Calculators) Look at the figure The Market for Calculators. Assume that S and D represent the domestic demand and supply of calculators. The world price, PW, equals $100. The government imposes a quota restricting imports to 25 calculators. If import licenses are granted to foreigners, the net loss due to the import quota is equal to area:

Accepted Answer

A) K + L. 
B) G + J. 
C) G + H + I + J. 
D) G + H + I + J + K + L. 
A) K + L. 
B) G + J. 
C) G + H + I + J. 
D) G + H + I + J + K + L.

Question 11

The United States must give up the production of 500 bicycles to produce 20 additional tractors. The opportunity cost of producing 5 tractors is _____ bicycles.

Accepted Answer

A) 5 
B) 20 
C) 100 
D) 125 
A) 5 
B) 20 
C) 100 
D) 125

Question 12

Evidence shows that increased international trade has increased the wages of unskilled workers in the United States.

Accepted Answer

A) True 
 B)False

Question 13

Use the following to answer questions :
Figure: The Market for Computers  
-(Figure: The Market for Computers) Look at the figure The Market for Computers. Assume that PA is the autarky price and PW is the world price. Producer surplus with international trade would be area:

Accepted Answer

A) X + Y + Z. 
B) W + X + Y. 
C) X + Y. 
D) Y. 
A) X + Y + Z. 
B) W + X + Y. 
C) X + Y. 
D) Y.

Question 14

Use the following to answer questions :  
-(Table: Production Possibilities in the United States and Colombia) Look at the table Production Possibilities in the United States and Colombia. Suppose that in autarky, Colombia produces 10 tons of coffee and 3 computers. The United States produces 8 tons of coffee and 20 computers. Can specialization and trade increase global production? Justify your answer.

Accepted Answer

Yes. Without trade a combined total of 1

Question 15

In a single year, the Netherlands can raise 100 tons of beef or produce 1,000 boxes of tulips. In the same growing season, Belgium can raise 50 tons of beef or produce 750 boxes of tulips. Trade will take place between these two countries if 1 ton of beef costs _____ boxes of tulips.

Accepted Answer

A) 20 
B) 5 
C) 12 
D) 8 
A) 20 
B) 5 
C) 12 
D) 8

Question 16

Britain must give up the production of 75 hats to produce 25 additional sweaters. The opportunity cost of producing 4 sweaters is _____ hats.

Accepted Answer

A) 4 
B) 12 
C) 71 
D) 79 
A) 4 
B) 12 
C) 71 
D) 79

Question 17

Many countries engage in trade protection by imposing import tariffs or quotas for at least some goods. This is because:

Accepted Answer

A) economists have established that such restrictions are welfare-improving for certain categories of goods (such as raw materials). 
B) such restrictions tend to benefit consumers without harming producers. 
C) while such restrictions harm consumers, they benefit producers, who are usually a more cohesive and politically influential group. 
D) while such restrictions harm consumers and benefit producers, the losses to consumers are outweighed by the gains to producers. 
A) economists have established that such restrictions are welfare-improving for certain categories of goods (such as raw materials). 
B) such restrictions tend to benefit consumers without harming producers. 
C) while such restrictions harm consumers, they benefit producers, who are usually a more cohesive and politically influential group. 
D) while such restrictions harm consumers and benefit producers, the losses to consumers are outweighed by the gains to producers.

Question 18

When a market begins to engage in international trade:

Accepted Answer

A) producers in the exporting industry may be better off. 
B) consumers of the imported good may be worse off. 
C) consumers of the exported good may be better off. 
D) producers in the importing industry are better off. 
A) producers in the exporting industry may be better off. 
B) consumers of the imported good may be worse off. 
C) consumers of the exported good may be better off. 
D) producers in the importing industry are better off.

Question 19

Over the past 50 years in the United States, as a percentage of gross domestic product:

Accepted Answer

A) exports have grown and imports have remained constant. 
B) imports have grown and exports have remained constant. 
C) exports have decreased. 
D) exports and imports have grown. 
A) exports have grown and imports have remained constant. 
B) imports have grown and exports have remained constant. 
C) exports have decreased. 
D) exports and imports have grown.

Question 20

If a country has the comparative advantage in producing wooden furniture, then with free trade:

Accepted Answer

A) the country will import wooden furniture. 
B) producer surplus in the market for wooden furniture will increase. 
C) consumer surplus in the market for wooden furniture will increase. 
D) the domestic quantity supplied will be less than the domestic quantity demanded. 
A) the country will import wooden furniture. 
B) producer surplus in the market for wooden furniture will increase. 
C) consumer surplus in the market for wooden furniture will increase. 
D) the domestic quantity supplied will be less than the domestic quantity demanded.

If Indonesia has lower wage rates than India, trade between these two nations will make India worse off.

Use the following to answer questions : Figure: The Market for Roses -(Figure: The Market for Roses) Look at the figure The Market for Roses. Assume that P_A is the autarky price and P_W is the world price. Consumer surplus without international trade would be area:

Use the following to answer questions : Figure: The Market for Tea in Sri Lanka -When an economy moves from autarky to free international trade, for industries in the export sector, consumer surplus ___, producer surplus _, and the economy as a whole ___.

In autarky, the amount of a country's production and consumption of a good must be identical.

A tariff imposed on U.S. imports into Japan tends to _ U.S. producers and _ Japanese producers.

The term autarky refers to a country that:

If a country's price for wood furniture in the absence of trade is lower than the price with trade, the country will likely:

If a country has the comparative advantage in producing cloth, in the market for cloth the autarky price would be _ the world price and the country would _ cloth.

Use the following to answer questions : Figure: The Market for Melons in Russia -(Figure: The Markets for Melons in Russia) Look at the figure The Market for Melons in Russia. If the world price of melons is equal to E, Russia will _____ of melons.

The United States must give up the production of 500 bicycles to produce 20 additional tractors. The opportunity cost of producing 5 tractors is _____ bicycles.

Evidence shows that increased international trade has increased the wages of unskilled workers in the United States.

Use the following to answer questions : Figure: The Market for Computers -(Figure: The Market for Computers) Look at the figure The Market for Computers. Assume that P_A is the autarky price and P_W is the world price. Producer surplus with international trade would be area:

In a single year, the Netherlands can raise 100 tons of beef or produce 1,000 boxes of tulips. In the same growing season, Belgium can raise 50 tons of beef or produce 750 boxes of tulips. Trade will take place between these two countries if 1 ton of beef costs _____ boxes of tulips.

Britain must give up the production of 75 hats to produce 25 additional sweaters. The opportunity cost of producing 4 sweaters is _____ hats.

Many countries engage in trade protection by imposing import tariffs or quotas for at least some goods. This is because:

When a market begins to engage in international trade:

Over the past 50 years in the United States, as a percentage of gross domestic product:

If a country has the comparative advantage in producing wooden furniture, then with free trade:

First Principles

Economic Models

Supply and Demand

Macroeconomics: the Big Picture

Gdp and Cpi: Tracking the Macroeconomy

Unemployment and Inflation

Long-Run Economic Growth

Savings, Investment Spending, and the Financial System

Fiscal Policy Appendix Taxes and the Multiplier

Money, Banking, and the Federal Reserve System

Monetary Policy

Inflation, Disinflation, and Deflation

Crises and Consequences

Events and Ideas

Open-Economy Macroeconomics

Graphs in Economics

toward a Fuller Understanding of Present Value

Filters

Exam 5: International Trade 5

If Indonesia has lower wage rates than India, trade between these two nations will make India worse off.

Use the following to answer questions : Figure: The Market for Roses -(Figure: The Market for Roses) Look at the figure The Market for Roses. Assume that PA is the autarky price and PW is the world price. Consumer surplus without international trade would be area:

Use the following to answer questions : Figure: The Market for Tea in Sri Lanka -When an economy moves from autarky to free international trade, for industries in the export sector, consumer surplus _____, producer surplus _____, and the economy as a whole _____.

In autarky, the amount of a country's production and consumption of a good must be identical.

A tariff imposed on U.S. imports into Japan tends to _____ U.S. producers and _____ Japanese producers.

The term autarky refers to a country that:

If a country's price for wood furniture in the absence of trade is lower than the price with trade, the country will likely:

If a country has the comparative advantage in producing cloth, in the market for cloth the autarky price would be _____ the world price and the country would _____ cloth.

Use the following to answer questions : Figure: The Market for Melons in Russia -(Figure: The Markets for Melons in Russia) Look at the figure The Market for Melons in Russia. If the world price of melons is equal to E, Russia will _____ of melons.

The United States must give up the production of 500 bicycles to produce 20 additional tractors. The opportunity cost of producing 5 tractors is _____ bicycles.

Evidence shows that increased international trade has increased the wages of unskilled workers in the United States.

Use the following to answer questions : Figure: The Market for Computers -(Figure: The Market for Computers) Look at the figure The Market for Computers. Assume that PA is the autarky price and PW is the world price. Producer surplus with international trade would be area:

In a single year, the Netherlands can raise 100 tons of beef or produce 1,000 boxes of tulips. In the same growing season, Belgium can raise 50 tons of beef or produce 750 boxes of tulips. Trade will take place between these two countries if 1 ton of beef costs _____ boxes of tulips.

Britain must give up the production of 75 hats to produce 25 additional sweaters. The opportunity cost of producing 4 sweaters is _____ hats.

Many countries engage in trade protection by imposing import tariffs or quotas for at least some goods. This is because:

When a market begins to engage in international trade:

Over the past 50 years in the United States, as a percentage of gross domestic product:

If a country has the comparative advantage in producing wooden furniture, then with free trade:

First Principles

Economic Models

Supply and Demand

Macroeconomics: the Big Picture

Gdp and Cpi: Tracking the Macroeconomy

Unemployment and Inflation

Long-Run Economic Growth

Savings, Investment Spending, and the Financial System

Fiscal Policy Appendix Taxes and the Multiplier

Money, Banking, and the Federal Reserve System

Monetary Policy

Inflation, Disinflation, and Deflation

Crises and Consequences

Events and Ideas

Open-Economy Macroeconomics

Graphs in Economics

toward a Fuller Understanding of Present Value

Filters

Use the following to answer questions : Figure: The Market for Roses -(Figure: The Market for Roses) Look at the figure The Market for Roses. Assume that P_A is the autarky price and P_W is the world price. Consumer surplus without international trade would be area:

Use the following to answer questions : Figure: The Market for Tea in Sri Lanka -When an economy moves from autarky to free international trade, for industries in the export sector, consumer surplus ___, producer surplus _, and the economy as a whole ___.

A tariff imposed on U.S. imports into Japan tends to _ U.S. producers and _ Japanese producers.

If a country has the comparative advantage in producing cloth, in the market for cloth the autarky price would be _ the world price and the country would _ cloth.

Use the following to answer questions : Figure: The Market for Computers -(Figure: The Market for Computers) Look at the figure The Market for Computers. Assume that P_A is the autarky price and P_W is the world price. Producer surplus with international trade would be area: