Question 1

What is the infant industry argument? How did Japan use the infant industry argument to rebuild its economic strength following World War II? What tools did it use?

Accepted Answer

The answer of What is the infant industry argument? How...

Question 2

Country X protects its domestic manufacturers from foreign competition by using a variety of nontariff barriers. Which of the following is not one of those nontariff barriers?

Accepted Answer

A)  foreign trade zones 
B)  product standards 
C)  regulatory controls 
D)  local purchase requirements

Question 3

Subsidies reduce the cost of doing business.

Accepted Answer

A) True 
 B)False

Question 4

What is the difference between an ad valorem tariff, specific tariff, and compound tariff? What is a countervailing duty and its purpose?

Accepted Answer

The answer of What is the difference between an ad...

Question 5

How does the United States handle complaints of unfair trade?

Accepted Answer

The answer of How does the United States handle complaints...

Question 6

Which of the following would most likely be used as a subsidy to entice firms to locate or expand facilities in a particular community?

Accepted Answer

A)  quotas 
B)  an embargo 
C)  a granting of corporate citizenship status 
D)  reduced utility rates

Question 7

What type of tariff is assessed as a specific dollar amount per unit of weight or other standard measure?

Accepted Answer

A)  ad valorem tariff 
B)  specific tariff 
C)  export tariff 
D)  compound tariff

Question 8

The South Korean government patterned its economic development strategies after the Japanese model.

Accepted Answer

A) True 
 B)False

Question 9

The "level playing field" argument is primarily used to justify government policies that ________.

Accepted Answer

A)  reduce import tariffs 
B)  restrict foreign competition 
C)  establish regional trade blocs 
D)  manipulate foreign exchange

Question 10

Which of the following is an example of a nontariff barrier that restricts access to distribution networks?

Accepted Answer

A)  Malaysia's requirement that during prime time at least 40 percent of the songs on the radio be by local artists 
B)  Turkmenistan's requirement that all imports of consumer goods be approved by the State Standards Committee 
C)  China's policy that imported sugar be distributed only by state-owned enterprises 
D)  Canada's requirement that baby food be packaged in 4.5- and 7.5-ounce containers

Question 11

A country's adoption of strategic trade policies to cover a broad group of industries can actually reduce the country's overall international competitiveness because favoring certain industries inevitably hurts others.

Accepted Answer

A) True 
 B)False

Question 12

Products manufactured in Brazil are transported through Mexico on their way to England. Mexico applies a tariff on the goods. What type of tariff is implemented by Mexico?

Accepted Answer

A)  transit tariff 
B)  ad valorem tariff 
C)  export tariff 
D)  compound tariff

Question 13

A foreign trade zone is primarily used by governments to ________.

Accepted Answer

A)  protect currency rates 
B)  enforce tariffs and duties 
C)  monitor foreign investments 
D)  spur economic development

Question 14

The U.S. government has decided to impose a tariff rate quota on sugar imports into the United States. Which of the following would benefit from this decision?

Accepted Answer

A)  soft drink producers 
B)  domestic sugar producers 
C)  steel producers 
D)  consumers of sugar products

Question 15

Country X imposes a low tariff rate for the first 5,000 pounds of rice it imports from Japan and a high tariff rate on all imported rice above this threshold. Country X most likely uses a ________.

Accepted Answer

A)  free trade zone 
B)  tariff rate quota 
C)  foreign currency control 
D)  voluntary export restraint

Question 16

A quota is a numerical limit on the quantity of a good that can be imported.

Accepted Answer

A) True 
 B)False

Question 17

How is a countervailing duty determined?

Accepted Answer

The answer of How is a countervailing duty determined?...

Question 18

A(n) ________ is calculated to offset the advantage an exporter receives from a subsidy.

Accepted Answer

A)  compound tariff 
B)  export promotion 
C)  countervailing duty 
D)  substitution tariff

Question 19

________ suggests that a country should encourage firms to compete in foreign markets by harnessing some advantage the country possesses.

Accepted Answer

A)  Strategic trade theory 
B)  Export promotion strategy 
C)  Import substitution strategy 
D)  Import promotion strategy

Question 20

What is the national defense argument for protectionism?

Accepted Answer

The answer of What is the national defense argument for...

Exam 9: Formulation of National Trade Policies

What is the infant industry argument? How did Japan use the infant industry argument to rebuild its economic strength following World War II? What tools did it use?

Country X protects its domestic manufacturers from foreign competition by using a variety of nontariff barriers. Which of the following is not one of those nontariff barriers?

Subsidies reduce the cost of doing business.

What is the difference between an ad valorem tariff, specific tariff, and compound tariff? What is a countervailing duty and its purpose?

How does the United States handle complaints of unfair trade?

Which of the following would most likely be used as a subsidy to entice firms to locate or expand facilities in a particular community?

What type of tariff is assessed as a specific dollar amount per unit of weight or other standard measure?

The South Korean government patterned its economic development strategies after the Japanese model.

The "level playing field" argument is primarily used to justify government policies that ________.

Which of the following is an example of a nontariff barrier that restricts access to distribution networks?

A country's adoption of strategic trade policies to cover a broad group of industries can actually reduce the country's overall international competitiveness because favoring certain industries inevitably hurts others.

Products manufactured in Brazil are transported through Mexico on their way to England. Mexico applies a tariff on the goods. What type of tariff is implemented by Mexico?

A foreign trade zone is primarily used by governments to ________.

The U.S. government has decided to impose a tariff rate quota on sugar imports into the United States. Which of the following would benefit from this decision?

Country X imposes a low tariff rate for the first 5,000 pounds of rice it imports from Japan and a high tariff rate on all imported rice above this threshold. Country X most likely uses a ________.

A quota is a numerical limit on the quantity of a good that can be imported.

How is a countervailing duty determined?

A(n) ________ is calculated to offset the advantage an exporter receives from a subsidy.

________ suggests that a country should encourage firms to compete in foreign markets by harnessing some advantage the country possesses.

What is the national defense argument for protectionism?