Question 1

-Refer to above figure.With a specific tariff of $3 per unit,what is the quantity of Widgets produced domestically?

Accepted Answer

The answer of  
-Refer to above figure.With a specific...

Question 2

If an import-competing firm is imperfectly competitive,than under free trade an import quota will ________ domestic market price,________ producer surplus,________ consumer surplus,________ government revenue,and ________ overall domestic national welfare.

Accepted Answer

A) decrease;decrease;increase;decrease;have no effect on 
B) increase;have no effect on;decrease;increase;decrease 
C) have no effect on;have no effect on;decrease;increase;decrease 
D) increase;increase;decrease;have no effect on;decrease 
E) decrease;increase;decrease;increase;decrease 
A) decrease;decrease;increase;decrease;have no effect on 
B) increase;have no effect on;decrease;increase;decrease 
C) have no effect on;have no effect on;decrease;increase;decrease 
D) increase;increase;decrease;have no effect on;decrease 
E) decrease;increase;decrease;increase;decrease

Question 3

The European Union's Common Agricultural Policy (CAP)is,in effect

Accepted Answer

A) a tariff imposed on agricultural exports. 
B) a tariff imposed on agricultural imports. 
C) a subsidy that reduces the cost of agricultural exports. 
D) a subsidy that increases the cost of agricultural exports. 
E) a quota that limits production of agricultural goods by EU nations. 
A) a tariff imposed on agricultural exports. 
B) a tariff imposed on agricultural imports. 
C) a subsidy that reduces the cost of agricultural exports. 
D) a subsidy that increases the cost of agricultural exports. 
E) a quota that limits production of agricultural goods by EU nations.

Question 4

The imposition of tariffs on imports results in deadweight (triangle)losses.These are

Accepted Answer

A) production and consumption distortion effects. 
B) redistribution effects. 
C) revenue effects 
D) efficiency effects. 
E) distortion of incentives. 
A) production and consumption distortion effects. 
B) redistribution effects. 
C) revenue effects 
D) efficiency effects. 
E) distortion of incentives.

Question 5

Tariffs are NOT defended on the grounds that they

Accepted Answer

A) improve the terms of trade of foreign nations. 
B) protect jobs and reduce unemployment. 
C) promote growth and development of young industries. 
D) prevent over-dependence of a country on only a few industries. 
E) protect domestic producers from foreign low prices. 
A) improve the terms of trade of foreign nations. 
B) protect jobs and reduce unemployment. 
C) promote growth and development of young industries. 
D) prevent over-dependence of a country on only a few industries. 
E) protect domestic producers from foreign low prices.

Question 6

-Refer to above figure.In the absence of trade,what is the country's consumer surplus?

Accepted Answer

The answer of  
-Refer to above figure.In the absence...

Question 7

Which of the following are examples of goods that have been subject to voluntary export restraints?

Accepted Answer

A) Japanese cars and Chinese solar panels 
B) Belgian chocolates and French wines 
C) French wines and cheeses 
D) Japanese sushi and German cars 
E) Taiwanese electronics and Canadian barley 
A) Japanese cars and Chinese solar panels 
B) Belgian chocolates and French wines 
C) French wines and cheeses 
D) Japanese sushi and German cars 
E) Taiwanese electronics and Canadian barley

Question 8

The most vocal political pressure for tariffs is generally made by

Accepted Answer

A) consumers lobbying for export tariffs. 
B) consumers lobbying for import tariffs. 
C) consumers lobbying for lower import tariffs. 
D) producers lobbying for export tariffs. 
E) producers lobbying for import tariffs. 
A) consumers lobbying for export tariffs. 
B) consumers lobbying for import tariffs. 
C) consumers lobbying for lower import tariffs. 
D) producers lobbying for export tariffs. 
E) producers lobbying for import tariffs.

Question 9

-Refer to above figure.The lowest specific tariff which would be considered prohibitive is ________.

Accepted Answer

The answer of  
-Refer to above figure.The lowest specific...

Question 10

-Refer to above figure.In the absence of trade,what is the country's producer surplus?

Accepted Answer

The answer of  
-Refer to above figure.In the absence...

Question 11

A policy of tariff reduction in the computer industry is

Accepted Answer

A) in the interest of the United States as a whole and in the interest of computer producing regions of the country. 
B) in the interest of the United States as a whole but not in the interest of computer producing regions of the country. 
C) not in the interest of the United States as a whole but in the interests of computer producing regions of the country. 
D) not in the interest of the United States as a whole and not in the interests of computer consumers. 
E) not in the interest of the United States as a whole but in the interests of foreign computer producers. 
A) in the interest of the United States as a whole and in the interest of computer producing regions of the country. 
B) in the interest of the United States as a whole but not in the interest of computer producing regions of the country. 
C) not in the interest of the United States as a whole but in the interests of computer producing regions of the country. 
D) not in the interest of the United States as a whole and not in the interests of computer consumers. 
E) not in the interest of the United States as a whole but in the interests of foreign computer producers.

Question 12

An export tariff will ________ producer surplus,________ consumer surplus,________ government revenue,and ________ overall domestic national welfare.

Accepted Answer

A) increase;decrease;increase;have an ambiguous effect on 
B) increase;decrease;decrease;decrease 
C) increase;decrease;have no effect on;have an ambiguous effect on 
D) increase;decrease;have no effect on;decrease 
E) increase;increase;decrease;have an ambiguous effect on 
A) increase;decrease;increase;have an ambiguous effect on 
B) increase;decrease;decrease;decrease 
C) increase;decrease;have no effect on;have an ambiguous effect on 
D) increase;decrease;have no effect on;decrease 
E) increase;increase;decrease;have an ambiguous effect on

Question 13

A specific tariff provides home producers more protection when

Accepted Answer

A) the home market buys cheaper products rather than expensive products. 
B) it is applied to a commodity with many grade variations. 
C) the home demand for a good is elastic with respect to price changes. 
D) it is levied on manufactured goods rather than primary products. 
E) the home supply outnumbers the foreign imports. 
A) the home market buys cheaper products rather than expensive products. 
B) it is applied to a commodity with many grade variations. 
C) the home demand for a good is elastic with respect to price changes. 
D) it is levied on manufactured goods rather than primary products. 
E) the home supply outnumbers the foreign imports.

Question 14

An important difference between tariffs and quotas is that tariffs

Accepted Answer

A) raise the price of the good. 
B) generate tax revenue for the government. 
C) stimulate international trade. 
D) help domestic producers. 
E) are paid by foreign producers. 
A) raise the price of the good. 
B) generate tax revenue for the government. 
C) stimulate international trade. 
D) help domestic producers. 
E) are paid by foreign producers.

Question 15

Which of the following is a fixed percentage of the value of an imported product?

Accepted Answer

A) specific tariff 
B) ad valorem tariff 
C) nominal tariff 
D) effective protection tariff 
E) infant industry tariff 
A) specific tariff 
B) ad valorem tariff 
C) nominal tariff 
D) effective protection tariff 
E) infant industry tariff

Question 16

-Refer to above figure.With free trade and no tariffs,what is the quantity of Widgets produced domestically?

Accepted Answer

The answer of  
-Refer to above figure.With free trade...

Question 17

Throughout the post-World War II era,the importance of tariffs as a trade barrier has

Accepted Answer

A) increased. 
B) decreased. 
C) remained the same. 
D) fluctuated wildly. 
E) demonstrated a classic random walk with a mean-reversion tendency. 
A) increased. 
B) decreased. 
C) remained the same. 
D) fluctuated wildly. 
E) demonstrated a classic random walk with a mean-reversion tendency.

Question 18

Tariff rates on products imported into the U.S.

Accepted Answer

A) have dropped substantially over the past 50 years. 
B) were prohibited by the Constitution. 
C) reached an all time high in 2002. 
D) have risen steadily since 1920. 
E) were the government's main source of income in 2006. 
A) have dropped substantially over the past 50 years. 
B) were prohibited by the Constitution. 
C) reached an all time high in 2002. 
D) have risen steadily since 1920. 
E) were the government's main source of income in 2006.

Question 19

In the country levying the tariff,the tariff will

Accepted Answer

A) increase both consumer and producer surplus. 
B) decrease both the consumer and producer surplus. 
C) decrease consumer surplus and increase producer surplus. 
D) increase consumer surplus and decrease producer surplus. 
E) decrease consumer surplus but leave producers surplus unchanged. 
A) increase both consumer and producer surplus. 
B) decrease both the consumer and producer surplus. 
C) decrease consumer surplus and increase producer surplus. 
D) increase consumer surplus and decrease producer surplus. 
E) decrease consumer surplus but leave producers surplus unchanged.

Question 20

A tax of 20 percent per unit of imported garlic is an example of a(n)

Accepted Answer

A) specific tariff. 
B) ad valorem tariff. 
C) nominal tariff. 
D) effective protection tariff. 
E) a disadvantageous tariff 
A) specific tariff. 
B) ad valorem tariff. 
C) nominal tariff. 
D) effective protection tariff. 
E) a disadvantageous tariff

Exam 9: The Instruments of Trade Policy

-Refer to above figure.With a specific tariff of $3 per unit,what is the quantity of Widgets produced domestically?

If an import-competing firm is imperfectly competitive,than under free trade an import quota will ________ domestic market price,________ producer surplus,________ consumer surplus,________ government revenue,and ________ overall domestic national welfare.

The European Union's Common Agricultural Policy (CAP)is,in effect

The imposition of tariffs on imports results in deadweight (triangle)losses.These are

Tariffs are NOT defended on the grounds that they

-Refer to above figure.In the absence of trade,what is the country's consumer surplus?

Which of the following are examples of goods that have been subject to voluntary export restraints?

The most vocal political pressure for tariffs is generally made by

-Refer to above figure.The lowest specific tariff which would be considered prohibitive is ________.

-Refer to above figure.In the absence of trade,what is the country's producer surplus?

A policy of tariff reduction in the computer industry is

An export tariff will ________ producer surplus,________ consumer surplus,________ government revenue,and ________ overall domestic national welfare.

A specific tariff provides home producers more protection when

An important difference between tariffs and quotas is that tariffs

Which of the following is a fixed percentage of the value of an imported product?

-Refer to above figure.With free trade and no tariffs,what is the quantity of Widgets produced domestically?

Throughout the post-World War II era,the importance of tariffs as a trade barrier has

Tariff rates on products imported into the U.S.

In the country levying the tariff,the tariff will

A tax of 20 percent per unit of imported garlic is an example of a(n)

Introduction

World Trade: an Overview

Labor Productivity and Comparative Advantage: the Ricardian Model

Specific Factors and Income Distribution

Resources and Trade: the Heckscher-Ohlin Model

The Standard Trade Model

External Economies of Scale and the International Location of Production

Firms in the Global Economy: Export Decisions, outsourcing, and Multinational Enterprises

The Political Economy of Trade Policy

Trade Policy in Developing Countries

Controversies in Trade Policy

National Income Accounting and the Balance of Payments

Exchange Rates and the Foreign Exchange Market: an Asset Approach

Money, interest Rates, and Exchange Rates

Price Levels and the Exchange Rate in the Long Run

Output and the Exchange Rate in the Short Run

Fixed Exchange Rates and Foreign Exchange Intervention

International Monetary Systems: an Historical Overview

Financial Globalization: Opportunity and Crisis

Optimum Currency Areas and the Euro

Developing Countries: Growth, crisis, and Reform

Filters

If an import-competing firm is imperfectly competitive,than under free trade an import quota will domestic market price, producer surplus, consumer surplus, government revenue,and overall domestic national welfare.

An export tariff will producer surplus, consumer surplus, government revenue,and overall domestic national welfare.