Exam 9: International Trade

Use the following to answer questions: Figure: International Trade 2 -(Figure: International Trade 2) Refer to the figure. At the tariff equilibrium in this figure, the quantity of imports is ______, which is ______ than at the free trade equilibrium.

The U.S. government restricting the quantity of sugar imports into the country is an example of a(n):

According to the supply and demand framework in the text, an increase in import trade tends to ______ domestic production of a good.

In poor countries, when child laborers get laid off they:

Trade increases competition for domestic producers and results in lower prices of domestic goods.

Both domestic production and consumption increase because of tariffs.

Use the following to answer questions: Figure: International Trade 3 -(Figure: International Trade 3) Refer to the figure. If the government in this diagram eliminates all imports with a tariff, the value of the lost gains from trade is:

______ have a similar effect upon domestic consumption levels.

A tariff ______ the world supply of a good.

Economic policies of protectionism include: I. reduced trade barriers. II. tariffs. III. quotas.

A trade quota on imports:

Which of the following statements is TRUE about the removal of trade barriers?

The economics of international trade is substantially different from that of ordinary trade.

The biggest retail contributor to the 1990s productivity boom was:

In a demand and supply diagram, the effects of a tariff and a quota on the supply and demand curves are identical.

Briefly describe a few activities that a typical student might do on any given day that reflect the effects of globalization.

With the aid of demand and supply curves, compare the amounts of imports and the prices of goods under (i) free trade, (ii) trade with a tariff, and (iii) a closed economy without trade.

Use the following to answer questions: Figure: Foreign Trade with a Tariff -(Figure: Foreign Trade with a Tariff) Refer to the figure. A $1 tariff generates increased domestic production by:

Imposing tariffs results in both wasted resources and lost gains from trade.

Suppose that a tariff increases domestic production of a good from 25 million units to 75 million units and raises the domestic price by $1.50. Assuming a linear domestic supply curve and a perfectly elastic world supply curve, what is the value of the resources wasted by increased domestic production?