Exam 19: International Trade

The benefits of trade include: I.greater productivity due to specialization. II.higher output due to specialization according to comparative advantage. III.increased welfare when preferences differ.

Under free trade,some jobs will be lost,but increased consumer spending power means there will be more jobs in other industries.However,these new jobs are:

What are the three major benefits of trade? Explain briefly.

The real cause of child labor is:

Free trade has reduced the number of jobs in U.S.manufacturing as well as the overall number of jobs in the U.S.economy.

A trade quota on imports:

Which of the following is NOT true regarding job destruction due to trade?

Use the following to answer questions Figure: Shirts -(Figure: Shirts)Refer to the figure.If a tariff raised the world price to $4 a shirt,how much deadweight loss would it create?

International and intranational trade are very different in terms of economic analysis.

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

Studies show that more openness to trade __________ income and _______ child labor.

The total number of child laborers is usually smaller for middle-income countries than for very poor countries.

The key industries argument for trade restrictions relies on the notion that:

Use the following to answer questions Figure: Foreign Trade 2 -(Figure: Foreign Trade 2)Refer to the figure.What is the dollar value of the deadweight loss created as a result of prohibiting trade in this market?

Restricting the importation of foreign automobiles will:

Use the following to answer questions Figure: Shirts -(Figure: Shirts)Refer to the figure.If a $5 tariff was levied on shirts,how much tax revenue would the government collect?

Which of the following decreases the volume of international trade?

With free trade,the domestic price of a good must be equal to the world price of a good.

After a pair of wars in the late seventeenth and early eighteenth centuries,French-British relations decayed to the point that England began putting high tariffs on French wines.A large part of the support for this law came from British brewers and distillers who feared the return of French competition after the wars.These tariffs help explain why,to this day,the English prefer beer over wine.Of the arguments against free trade,which seems most likely to apply here,given the information provided?

Use the following to answer questions Figure: A Tariff on Imports -(Figure: A Tariff on Imports)Refer to the figure.Suppose the government intervenes with a $2 tariff;the total cost of the tariff to the citizens in that country is: