Question 1

The following graph shows the supply of and demand for baseballs in the United States.If the world price is $3 per baseball and a tariff of $1 per baseball is imposed,the net welfare loss of the tariff is shown by the area _____.

Accepted Answer

A)  g
B)  c
C)  a
D)  c and g
E)  b and fF) A) and D)
G) C) and D)

Question 2

Which of the following does not result in a mutually beneficial trade between two countries?

Accepted Answer

A)  One country having a higher opportunity cost of production of a good than the other
B)  One country having an abundant supply of natural resources than the other
C)  One country's production being more efficient than the other
D)  One country having an absolute advantage over the other
E)  One country having a comparative advantage in producing a good than the otherF) B) and E)
G) A) and B)

Question 3

Economists argue that U.S.government can earn federal revenue:

Accepted Answer

A)  from quotas by auctioning off quotas to foreign producers.
B)  by increasing the profitability of getting quota rights.
C)  by encouraging foreign governments to retaliate with quotas and tariffs of their own.
D)  from quotas,as quotas redistribute wealth from domestic consumers to domestic producers.
E)  by distributing quota rights to domestic exporters.F) All of the above
G) B) and E)

Question 4

The following image shows the market for wheat for the country of Palatino.SD is the domestic supply of wheat,and DD is the domestic demand for wheat.Suppose the world price of wheat is $9 per bushel of wheat.Suppose a specific tariff of $6 is imposed on each bushel of wheat imported.Government revenue from the tariff equals:
D is the domestic supply of wheat,and DD is the domestic demand for wheat.Suppose the world price of wheat is $9 per bushel of wheat.Suppose a specific tariff of $6 is imposed on each bushel of wheat imported.Government revenue from the tariff equals:   A) $45,000. B) $3,000,000. C) $1,800,000. D) $900,000. E) $50,000." class="answers-bank-image d-inline" rel="preload" >

Accepted Answer

A)  $45,000.
B)  $3,000,000.
C)  $1,800,000.
D)  $900,000.
E)  $50,000.F) A) and D)
G) All of the above

Question 5

A nation's producers can compete effectively with imports from other nations if:

Accepted Answer

A)  they have an abundance of unskilled workers.
B)  the relative price of exports to imports is high.
C)  the labor cost per unit of output is low.
D)  they have a high opportunity cost of production.
E)  they have an absolute advantage in the production of all goods.F) A) and D)
G) B) and D)

Question 6

Autarky is: ​

Accepted Answer

A)  the situation of national self-sufficiency,in which there is no economic interaction with foreign producers or consumers.
B)  the situation in which there is no legal limit on the amount of a commodity that can be imported.
C)  the situation in which countries export products they can produce more cheaply in return for products that are unavailable domestically or are cheaper elsewhere.
D)  the situation in which world price is determined by the world supply and demand for a product.
E)  the situation in which each country specializes in making goods with the lowest opportunity cost.F) B) and C)
G) A) and D)

Question 7

The American Tire Company has been experiencing a steady loss of market over the past 40 years due to imports of lower-priced tires.Which of the following arguments would American Tire most likely present to Congress when it lobbies for trade restrictions?

Accepted Answer

A)  The infant industry argument
B)  The declining industry argument
C)  The national defense argument
D)  The antidumping argument
E)  The jobs and income argumentF) C) and E)
G) A) and B)

Question 8

The following graph shows the demand for and the supply of a good in a country.If the world price of the good is $2.00 per unit and an import quota of 50 units per month is imposed,then the decrease in consumer surplus can be represented by the area _____.

Accepted Answer

A)  f
B)  i
C)  h
D)  f,g,and h
E)  a,b,c,d,and eF) C) and E)
G) B) and E)

Question 9

Suppose there is a policy debate over imposing trade restrictions on imported semiconductors in the United States.A congresswoman argues that it is necessary to impose trade restrictions,such as a tariff,on the semiconductor industry to protect workers in the domestic semiconductor industry.The congresswoman claims that without trade protection,there will be layoffs,causing many U.S.workers in the semiconductor industry to be unemployed.She is basing her preference for trade restrictions on the:

Accepted Answer

A)  infant industry argument.
B)  declining industries argument.
C)  national defense argument.
D)  jobs and income argument.
E)  antidumping argument.F) D) and E)
G) A) and E)

Question 10

One reason for international specialization is:

Accepted Answer

A)  a high world price for a good.
B)  higher trade restrictions imposed by a national government.
C)  diminishing returns to a variable factor of production.
D)  the different resource endowments throughout the world.
E)  the difference in benefits that consumers and producers get from domestic market exchange.F) A) and B)
G) B) and E)

Question 11

U.S.consumers would be better off if they bought only U.S.-produced goods.

Accepted Answer

A) True 
 B)False

Question 12

Japan is generally considered a closed economy.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following is true of international trade?

Accepted Answer

A)  It allows a country to specialize in the production of certain goods and services.
B)  It leads to a reduction in the world production of goods and services.
C)  It allows a country to move to a lower consumption possibilities frontier.
D)  It allows a country's consumption possibilities frontier to lie inside its production possibilities frontier.
E)  It makes a country's production possibilities frontier a downward-sloping straight line.F) A) and E)
G) A) and B)

Question 14

Which of the following is true of autarky?

Accepted Answer

A)  Each country's consumption possibilities are the same as its production possibilities.
B)  Equilibrium is attained with the maximum gains from specialization and trade.
C)  There is no legal limit on the amount of a commodity that can be imported.
D)  Countries export products they can produce more cheaply in return for products that are unavailable domestically or are cheaper elsewhere.
E)  World price is determined by the world supply and demand for a product.F) B) and C)
G) C) and E)

Question 15

Tariffs and quotas are the only two devices used to restrict foreign trade.

Accepted Answer

A) True 
 B)False

Question 16

Specialization based on absolute advantage leads to gains from trade.

Accepted Answer

A) True 
 B)False

Question 17

If the United States has an absolute advantage in producing computer components,it should export them worldwide.

Accepted Answer

A) True 
 B)False

Question 18

The following graph shows the supply of and demand for baseballs in the United States.If the world price of a baseball is $3,then the quantity of baseballs demanded is _____.

Accepted Answer

A)  4,000
B)  6,000
C)  8,000
D)  10,000
E)  12,000F) A) and D)
G) C) and D)

Question 19

Which of the following is not a type of trade restriction?

Accepted Answer

A)  Low-interest loans to foreign buyers
B)  Export subsidies to domestic producers
C)  Restrictive health and safety standards
D)  Domestic content requirements
E)  Economies of scaleF) All of the above
G) C) and D)

Question 20

Which of the following is true of a country's production possibilities frontier?

Accepted Answer

A)  International trade makes it possible for a country's consumption possibilities to exceed its production possibilities.
B)  International trade requires that a country's production possibilities exceed its consumption possibilities.
C)  A country's production possibilities always equal its consumption possibilities.
D)  A country's consumption possibilities can never equal its production possibilities because of leakages in the system.
E)  The slope of a country's production possibilities frontier is equal to the absolute advantage of producing a particular good.F) A) and B)
G) B) and E)

Exam 17: International Trade

Japan is generally considered a closed economy.

Correct Answer
verified

If the United States has an absolute advantage in producing computer components,it should export them worldwide.

Correct Answer
verified

Which of the following does not result in a mutually beneficial trade between two countries?

Correct Answer
verified

Tariffs and quotas are the only two devices used to restrict foreign trade.

Correct Answer
verified

Which of the following is not a type of trade restriction?

Correct Answer
verified

One reason for international specialization is:

Correct Answer
verified

A nation's producers can compete effectively with imports from other nations if:

Correct Answer
verified

Which of the following is true of international trade?

Correct Answer
verified

Autarky is:

Correct Answer
verified

The American Tire Company has been experiencing a steady loss of market over the past 40 years due to imports of lower-priced tires.Which of the following arguments would American Tire most likely present to Congress when it lobbies for trade restrictions?

Correct Answer
verified

The following graph shows the supply of and demand for baseballs in the United States.If the world price is $3 per baseball and a tariff of $1 per baseball is imposed,the net welfare loss of the tariff is shown by the area _____.

Correct Answer
verified

Correct Answer
verified

Which of the following is true of a country's production possibilities frontier?

Correct Answer
verified

The following graph shows the demand for and the supply of a good in a country.If the world price of the good is $2.00 per unit and an import quota of 50 units per month is imposed,then the decrease in consumer surplus can be represented by the area _____.

Correct Answer
verified

U.S.consumers would be better off if they bought only U.S.-produced goods.

Correct Answer
verified

Correct Answer
verified

Specialization based on absolute advantage leads to gains from trade.

Correct Answer
verified

The following graph shows the supply of and demand for baseballs in the United States.If the world price of a baseball is $3,then the quantity of baseballs demanded is _____.

Correct Answer
verified

Economists argue that U.S.government can earn federal revenue:

Correct Answer
verified

Which of the following is true of autarky?

Correct Answer
verified

Exam 17: International Trade

Japan is generally considered a closed economy.

Correct AnswerverifiedShow Answer

If the United States has an absolute advantage in producing computer components,it should export them worldwide.

Correct AnswerverifiedShow Answer

Which of the following does not result in a mutually beneficial trade between two countries?

Correct AnswerverifiedShow Answer

Tariffs and quotas are the only two devices used to restrict foreign trade.

Correct AnswerverifiedShow Answer

Which of the following is not a type of trade restriction?

Correct AnswerverifiedShow Answer

One reason for international specialization is:

Correct AnswerverifiedShow Answer

A nation's producers can compete effectively with imports from other nations if:

Correct AnswerverifiedShow Answer

Which of the following is true of international trade?

Correct AnswerverifiedShow Answer

Autarky is: ​

Correct AnswerverifiedShow Answer

The American Tire Company has been experiencing a steady loss of market over the past 40 years due to imports of lower-priced tires.Which of the following arguments would American Tire most likely present to Congress when it lobbies for trade restrictions?

Correct AnswerverifiedShow Answer

The following graph shows the supply of and demand for baseballs in the United States.If the world price is $3 per baseball and a tariff of $1 per baseball is imposed,the net welfare loss of the tariff is shown by the area _____.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following is true of a country's production possibilities frontier?

Correct AnswerverifiedShow Answer

The following graph shows the demand for and the supply of a good in a country.If the world price of the good is $2.00 per unit and an import quota of 50 units per month is imposed,then the decrease in consumer surplus can be represented by the area _____.

Correct AnswerverifiedShow Answer

U.S.consumers would be better off if they bought only U.S.-produced goods.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Specialization based on absolute advantage leads to gains from trade.

Correct AnswerverifiedShow Answer

The following graph shows the supply of and demand for baseballs in the United States.If the world price of a baseball is $3,then the quantity of baseballs demanded is _____.

Correct AnswerverifiedShow Answer

Economists argue that U.S.government can earn federal revenue:

Correct AnswerverifiedShow Answer

Which of the following is true of autarky?

Correct AnswerverifiedShow Answer

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Autarky is:

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