Question 1

When a country that imports a particular good imposes an import quota on that good,

Accepted Answer

A) producer surplus increases and total surplus increases in the market for that good. 
B) producer surplus increases and total surplus decreases in the market for that good. 
C) producer surplus decreases and total surplus increases in the market for that good. 
D) producer surplus decreases and total surplus decreases in the market for that good. 
A) producer surplus increases and total surplus increases in the market for that good. 
B) producer surplus increases and total surplus decreases in the market for that good. 
C) producer surplus decreases and total surplus increases in the market for that good. 
D) producer surplus decreases and total surplus decreases in the market for that good.

Question 2

Figure 9-12  
-Refer to Figure 9-12.Producer surplus before trade is

Accepted Answer

A) $14,400. 
B) $16,800. 
C) $21,600. 
D) $24,800. 
A) $14,400. 
B) $16,800. 
C) $21,600. 
D) $24,800.

Question 3

Figure 9-2
The figure illustrates the market for calculators in a country.  
-Refer to Figure 9-2.With free trade,producer surplus is

Accepted Answer

A) $845. 
B) $1,620. 
C) $1,690. 
D) $3,240. 
A) $845. 
B) $1,620. 
C) $1,690. 
D) $3,240.

Question 4

When a country allows trade and becomes an exporter of a good,

Accepted Answer

A) domestic producers become better off,and domestic consumers become worse off. 
B) domestic producers become worse off,and domestic consumers become better off. 
C) domestic producers become better off,but the effect on the well-being of domestic consumers is ambiguous. 
D) domestic consumers become worse off,but the effect on the well-being of domestic producers is ambiguous. 
A) domestic producers become better off,and domestic consumers become worse off. 
B) domestic producers become worse off,and domestic consumers become better off. 
C) domestic producers become better off,but the effect on the well-being of domestic consumers is ambiguous. 
D) domestic consumers become worse off,but the effect on the well-being of domestic producers is ambiguous.

Question 5

Figure 9-8.On the diagram below,Q represents the quantity of cars and P represents the price of cars.  
-Refer to Figure 9-8.The country for which the figure is drawn

Accepted Answer

A) has a comparative advantage relative to other countries in the production of cars and it will export cars. 
B) has a comparative advantage relative to other countries in the production of cars and it will import cars. 
C) has a comparative disadvantage relative to other countries in the production of cars and it will export cars. 
D) has a comparative disadvantage relative to other countries in the production of cars and it will import cars. 
A) has a comparative advantage relative to other countries in the production of cars and it will export cars. 
B) has a comparative advantage relative to other countries in the production of cars and it will import cars. 
C) has a comparative disadvantage relative to other countries in the production of cars and it will export cars. 
D) has a comparative disadvantage relative to other countries in the production of cars and it will import cars.

Question 6

When a country that imports a particular good imposes an import quota on that good,

Accepted Answer

A) consumer surplus increases and total surplus increases in the market for that good. 
B) consumer surplus increases and total surplus decreases in the market for that good. 
C) consumer surplus decreases and total surplus increases in the market for that good. 
D) consumer surplus decreases and total surplus decreases in the market for that good. 
A) consumer surplus increases and total surplus increases in the market for that good. 
B) consumer surplus increases and total surplus decreases in the market for that good. 
C) consumer surplus decreases and total surplus increases in the market for that good. 
D) consumer surplus decreases and total surplus decreases in the market for that good.

Question 7

When a country allows international trade and becomes an importer of a good,

Accepted Answer

A) domestic producers of the good become better off. 
B) domestic consumers of the good become worse off. 
C) the gains of the winners exceed the losses of the losers. 
D) All of the above are correct. 
A) domestic producers of the good become better off. 
B) domestic consumers of the good become worse off. 
C) the gains of the winners exceed the losses of the losers. 
D) All of the above are correct.

Question 8

Figure 9-14.On the diagram below,Q represents the quantity of crude oil and P represents the price of crude oil.  
-Refer to Figure 9-14.When the country for which the figure is drawn allows international trade in crude oil,

Accepted Answer

A) consumer surplus for domestic crude-oil consumers decreases. 
B) the demand for crude oil by domestic crude-oil consumers decreases. 
C) the losses of the domestic losers outweigh the gains of the domestic winners. 
D) domestic crude-oil producers sell less crude oil. 
A) consumer surplus for domestic crude-oil consumers decreases. 
B) the demand for crude oil by domestic crude-oil consumers decreases. 
C) the losses of the domestic losers outweigh the gains of the domestic winners. 
D) domestic crude-oil producers sell less crude oil.

Question 9

Figure 9-8.On the diagram below,Q represents the quantity of cars and P represents the price of cars.  
-Refer to Figure 9-8.The price corresponding to the horizontal dotted line on the graph represents the price of cars

Accepted Answer

A) after trade is allowed. 
B) before trade is allowed. 
C) that maximizes total surplus when trade is allowed. 
D) that minimizes the well-being of domestic car producers when trade is allowed. 
A) after trade is allowed. 
B) before trade is allowed. 
C) that maximizes total surplus when trade is allowed. 
D) that minimizes the well-being of domestic car producers when trade is allowed.

Question 10

Suppose France imposes a tariff on wine of 3 euros per bottle.If government revenue from the tariff amounts to 30 million euros per year and if the quantity of wine supplied by French wine producers,with the tariff,is 8 million bottles per year,then we can conclude that

Accepted Answer

A) the quantity of wine demanded by France,with the tariff,is 18 million bottles per year. 
B) the quantity of wine demanded by France,without the tariff,would be 24 million bottles per year. 
C) the amount of the deadweight loss is 24 million euros per year. 
D) the tariff causes French buyers of wine to pay 2 euros more per bottle than they would pay without the tariff. 
A) the quantity of wine demanded by France,with the tariff,is 18 million bottles per year. 
B) the quantity of wine demanded by France,without the tariff,would be 24 million bottles per year. 
C) the amount of the deadweight loss is 24 million euros per year. 
D) the tariff causes French buyers of wine to pay 2 euros more per bottle than they would pay without the tariff.

Question 11

When the nation of Brownland first permitted trade with other nations,domestic producers of wheat experienced an increase in producer surplus of $4 million and total surplus in Brownland's wheat market increased by $1 million.We can conclude that

Accepted Answer

A) Brownland became an exporter of wheat. 
B) consumer surplus in Brownland increased by $3 million. 
C) the opening of trade caused the domestic supply curve for wheat in Brownland to shift to the left. 
D) this example is inconsistent with the economic theory of international trade. 
A) Brownland became an exporter of wheat. 
B) consumer surplus in Brownland increased by $3 million. 
C) the opening of trade caused the domestic supply curve for wheat in Brownland to shift to the left. 
D) this example is inconsistent with the economic theory of international trade.

Question 12

Figure 9-7.The figure applies to the nation of Wales and the good is cheese.  
-Refer to Figure 9-7.With trade,the Welsh price of cheese and the Welsh quantity of cheese demanded are

Accepted Answer

A) P1 and Q2. 
B) P1 and Q1. 
C) P0 and Q0. 
D) P3 and Q1. 
A) P1 and Q2. 
B) P1 and Q1. 
C) P0 and Q0. 
D) P3 and Q1.

Question 13

Figure 9-17  
-Refer to Figure 9-17.The deadweight loss caused by the tariff is

Accepted Answer

A) $24. 
B) $72. 
C) $96. 
D) $144. 
A) $24. 
B) $72. 
C) $96. 
D) $144.

Question 14

When a country abandons a no-trade policy,adopts a free-trade policy,and becomes an importer of a particular good,

Accepted Answer

A) consumer surplus increases and total surplus increases in the market for that good. 
B) consumer surplus increases and total surplus decreases in the market for that good. 
C) consumer surplus decreases and total surplus increases in the market for that good. 
D) consumer surplus decreases and total surplus decreases in the market for that good. 
A) consumer surplus increases and total surplus increases in the market for that good. 
B) consumer surplus increases and total surplus decreases in the market for that good. 
C) consumer surplus decreases and total surplus increases in the market for that good. 
D) consumer surplus decreases and total surplus decreases in the market for that good.

Question 15

Figure 9-24
The following diagram shows the domestic demand and supply in a market.Assume that the world price in this market is $20 per unit.  
-Refer to Figure 9-24.Suppose the government imposes a tariff of $10 per unit.The deadweight loss caused by the tariff is

Accepted Answer

A) $25. 
B) $50. 
C) $75. 
D) $100. 
A) $25. 
B) $50. 
C) $75. 
D) $100.

Question 16

Figure 9-1
The figure illustrates the market for coffee in Guatemala.  
-Refer to Figure 9-1.When trade is allowed,

Accepted Answer

A) Guatemalan producers of coffee become better off and Guatemalan consumers of coffee become worse off. 
B) Guatemalan consumers of coffee become better off and Guatemalan producers of coffee become worse off. 
C) both Guatemalan producers and consumers of coffee become better off. 
D) both Guatemalan producers and consumers of coffee become worse off. 
A) Guatemalan producers of coffee become better off and Guatemalan consumers of coffee become worse off. 
B) Guatemalan consumers of coffee become better off and Guatemalan producers of coffee become worse off. 
C) both Guatemalan producers and consumers of coffee become better off. 
D) both Guatemalan producers and consumers of coffee become worse off.

Question 17

Figure 9-18.On the diagram below,Q represents the quantity of peaches and P represents the price of peaches.The domestic country is Isoland.  
-Refer to Figure 9-18.If Isoland allows international trade and the world price of peaches is $5,then

Accepted Answer

A) producer surplus will be smaller than it would be if Isoland banned trade. 
B) consumer surplus will be smaller than it would be if Isoland banned trade. 
C) the domestic quantity of peaches demanded will exceed the domestic quantity of peaches supplied. 
D) Isoland will be an importer of peaches. 
A) producer surplus will be smaller than it would be if Isoland banned trade. 
B) consumer surplus will be smaller than it would be if Isoland banned trade. 
C) the domestic quantity of peaches demanded will exceed the domestic quantity of peaches supplied. 
D) Isoland will be an importer of peaches.

Question 18

Figure 9-13  
-Refer to Figure 9-13.With trade,producer surplus is

Accepted Answer

A) $900. 
B) $1,100. 
C) $1,500. 
D) $2,000. 
A) $900. 
B) $1,100. 
C) $1,500. 
D) $2,000.

Question 19

​Figure 9-26
The diagram below illustrates the market for baseballs in the U.S.  
-Refer to figure 9-26.After opening the U.S.baseball market to international trade,total surplus is

Accepted Answer

A) ​$4800. 
B) ​$5400. 
C) ​$6000. 
D) ​$1200 
A) ​$4800. 
B) ​$5400. 
C) ​$6000. 
D) ​$1200

Question 20

When a country opens up to trade in a good for which it has a comparative advantage,and the country begins to export the good,we can conclude that

Accepted Answer

A) ​the domestic price will fall after trade opens up. 
B) ​both buyers and sellers in that country will be better off as a consequence of opening up the market to international trade. 
C) ​the total surplus for this good will increase as a result of opening up the market to international trade. 
D) ​opening the market to international trade will create a deadweight loss. 
A) ​the domestic price will fall after trade opens up. 
B) ​both buyers and sellers in that country will be better off as a consequence of opening up the market to international trade. 
C) ​the total surplus for this good will increase as a result of opening up the market to international trade. 
D) ​opening the market to international trade will create a deadweight loss.

Exam 9: Application International Trade: The Winners and Losers From Trade

When a country that imports a particular good imposes an import quota on that good,

Figure 9-12 -Refer to Figure 9-12.Producer surplus before trade is

Figure 9-2 The figure illustrates the market for calculators in a country. -Refer to Figure 9-2.With free trade,producer surplus is

When a country allows trade and becomes an exporter of a good,

Figure 9-8.On the diagram below,Q represents the quantity of cars and P represents the price of cars. -Refer to Figure 9-8.The country for which the figure is drawn

When a country that imports a particular good imposes an import quota on that good,

When a country allows international trade and becomes an importer of a good,

Figure 9-14.On the diagram below,Q represents the quantity of crude oil and P represents the price of crude oil. -Refer to Figure 9-14.When the country for which the figure is drawn allows international trade in crude oil,

Figure 9-8.On the diagram below,Q represents the quantity of cars and P represents the price of cars. -Refer to Figure 9-8.The price corresponding to the horizontal dotted line on the graph represents the price of cars

Suppose France imposes a tariff on wine of 3 euros per bottle.If government revenue from the tariff amounts to 30 million euros per year and if the quantity of wine supplied by French wine producers,with the tariff,is 8 million bottles per year,then we can conclude that

When the nation of Brownland first permitted trade with other nations,domestic producers of wheat experienced an increase in producer surplus of $4 million and total surplus in Brownland's wheat market increased by $1 million.We can conclude that

Figure 9-7.The figure applies to the nation of Wales and the good is cheese. -Refer to Figure 9-7.With trade,the Welsh price of cheese and the Welsh quantity of cheese demanded are

Figure 9-17 -Refer to Figure 9-17.The deadweight loss caused by the tariff is

When a country abandons a no-trade policy,adopts a free-trade policy,and becomes an importer of a particular good,

Figure 9-24 The following diagram shows the domestic demand and supply in a market.Assume that the world price in this market is $20 per unit. -Refer to Figure 9-24.Suppose the government imposes a tariff of $10 per unit.The deadweight loss caused by the tariff is

Figure 9-1 The figure illustrates the market for coffee in Guatemala. -Refer to Figure 9-1.When trade is allowed,

Figure 9-18.On the diagram below,Q represents the quantity of peaches and P represents the price of peaches.The domestic country is Isoland. -Refer to Figure 9-18.If Isoland allows international trade and the world price of peaches is $5,then

Figure 9-13 -Refer to Figure 9-13.With trade,producer surplus is

​Figure 9-26 The diagram below illustrates the market for baseballs in the U.S. -Refer to figure 9-26.After opening the U.S.baseball market to international trade,total surplus is

When a country opens up to trade in a good for which it has a comparative advantage,and the country begins to export the good,we can conclude that

Ten Principles of Economics

Ten Principles of Economics: How People Make Decisions

Ten Principles of Economics: How People Interact

Ten Principles of Economics: How the Economy As a Whole Works

Ten Principles of Economics: Part A

Ten Principles of Economics: Part B

Thinking Like an Economist

Thinking Like an Economist: The Economist As Scientist

Thinking Like an Economist: The Economist As Policy Adviser

Thinking Like an Economist: Why Economists Disagree

Thinking Like an Economist: Lets Get Going

Thinking Like an Economist: Graphing a Brief Review

Thinking Like an Economist: Part A

Thinking Like an Economist: Part B

Interdependence and the Gains From Trade

Interdependence and the Gains From Trade: A Parable for the Modern Economy

Interdependence and the Gains From Trade: Comparative Advantage the Driving Force of Specialization

Interdependence and the Gains From Trade: Applications of Comparative Advantage

Interdependence and the Gains From Trade: Conclusion

Interdependence and the Gains From Trade: Part A

Interdependence and the Gains From Trade: Part B

The Market Forces of Supply and Demand

The Market Forces of Supply and Demand:Markets and Competition

The Market Forces of Supply and Demand: Demand

The Market Forces of Supply and Demand: Supply

The Market Forces of Supply and Demand: Supply and Demand Together

The Market Forces of Supply and DemandConclusion How Prices Allocate Resources

The Market Forces of Supply and Demand: Part A

The Market Forces of Supply and Demand: Part B

Elasticity and Its Applications

Elasticity and Its Applications: The Elasticity of Demand

Elasticity and Its Applications: The Elasticity of Supply

Elasticity and Its Applications: Three Applications of Supply,demand,and Elasticity

Elasticity and Its Applications: Part A

Elasticity and Its Applications: Part B

Supply Demand and Government Policies

Supply Demand and Government Policies: Controls on Prices

Supply Demand and Government Policies: Taxes

Supply Demand and Government Policies: Part A

Supply Demand and Government Policies: Part B

Consumers Producers and the Efficiency of Markets

Consumers Producers and the Efficiency of Markets: Consumer Surplus

Consumers Producers and the Efficiency of Markets: Producer Surplus

Consumers Producers and the Efficiency of Markets: Market Efficiency

Consumers Producers and the Efficiency of Markets: Conclusion Market Efficiency and Market Failure

Consumers Producers and the Efficiency of Markets: Part A

Consumers Producers and the Efficiency of Markets: Part B

Application the Cost of Taxation

Application the Cost of Taxation: The Deadweight Loss of Taxation

Application the Cost of Taxation: The Determinants of the Deadweight Loss

Application the Cost of Taxation: Deadweight Loss and Tax Revenue As Taxes Vary

Application the Cost of Taxation: Conclusion

Application the Cost of Taxation: Part A

Application the Cost of Taxation: Part B

Application International Trade

Application International Trade: The Determinants of Trade

Application International Trade: The Arguments for Restricting Trade

Application International Trade: Conclusion

Application International Trade: Part A

Figure 9-26 The diagram below illustrates the market for baseballs in the U.S. -Refer to figure 9-26.After opening the U.S.baseball market to international trade,total surplus is