Question 1

An increase in a country's net commodity terms of trade will

Accepted Answer

A) always increase the country's real income. 
B) not always guarantee positive changes in the country's economy. 
C) always increase the country's economic welfare. 
D) never increase the country's quantity of exports. 
E) always increase the country's production of its import competing good. 
A) always increase the country's real income. 
B) not always guarantee positive changes in the country's economy. 
C) always increase the country's economic welfare. 
D) never increase the country's quantity of exports. 
E) always increase the country's production of its import competing good.

Question 2

Terms of trade refers to

Accepted Answer

A) the tariffs applied to trade. 
B) what goods are exported. 
C) the volume of trade. 
D) the relative price at which trade occurs. 
E) what goods are imported. 
A) the tariffs applied to trade. 
B) what goods are exported. 
C) the volume of trade. 
D) the relative price at which trade occurs. 
E) what goods are imported.

Question 3

An export subsidy will cause the terms of trade of the country to and will the country.

Accepted Answer

A) importing; suffer; benefit 
B) exporting; improve; benefit 
C) importing; improve; harm 
D) importing; suffer; harm 
E) exporting; suffer; harm 
A) importing; suffer; benefit 
B) exporting; improve; benefit 
C) importing; improve; harm 
D) importing; suffer; harm 
E) exporting; suffer; harm

Question 4

Tastes of individuals are represented by

Accepted Answer

A) production possibility frontiers. 
B) the terms of trade. 
C) production functions. 
D) indifference curves. 
E) isovalue lines. 
A) production possibility frontiers. 
B) the terms of trade. 
C) production functions. 
D) indifference curves. 
E) isovalue lines.

Question 5

The price of consumption in terms of _ consumption is .

Accepted Answer

A) future; current; 1 + r 
B) future; current; r 
C) present; future; 1/(1 + r) 
D) present; future; r 
E) future; current; 1/(1 + r) 
A) future; current; 1 + r 
B) future; current; r 
C) present; future; 1/(1 + r) 
D) present; future; r 
E) future; current; 1/(1 + r)

Question 6

If points A and B are two locations on a country's production possibility frontier,then

Accepted Answer

A) both bundles must have the same relative cost. 
B) consumers are indifferent between the two bundles. 
C) at any point in time,the country could produce both. 
D) the country could produce either of the two bundles. 
E) producers are indifferent between the two bundles. 
A) both bundles must have the same relative cost. 
B) consumers are indifferent between the two bundles. 
C) at any point in time,the country could produce both. 
D) the country could produce either of the two bundles. 
E) producers are indifferent between the two bundles.

Question 7

An import tariff will cause the relative demand for to and the relative supply for to .

Accepted Answer

A) imports; decrease; imports; increase 
B) exports; increase; imports; decrease 
C) exports; decrease; exports; increase 
D) exports; increase; exports; decrease 
E) imports; increase; imports; decrease 
A) imports; decrease; imports; increase 
B) exports; increase; imports; decrease 
C) exports; decrease; exports; increase 
D) exports; increase; exports; decrease 
E) imports; increase; imports; decrease

Question 8

If one observes that Japan was traditionally a net foreign lender,one could conclude that relative to its international trade and financial partners

Accepted Answer

A) Japan's intertemporal production possibilities are not biased. 
B) Japan preferred to consume beyond its production in the present. 
C) Japan's intertemporal production possibilities are biased toward future consumption. 
D) Japan's intertemporal production possibilities are biased toward present consumption. 
E) Japan's intertemporal production possibilities are larger than that of the other countries. 
A) Japan's intertemporal production possibilities are not biased. 
B) Japan preferred to consume beyond its production in the present. 
C) Japan's intertemporal production possibilities are biased toward future consumption. 
D) Japan's intertemporal production possibilities are biased toward present consumption. 
E) Japan's intertemporal production possibilities are larger than that of the other countries.

Question 9

Rapidly growing developing countries tend to be borrowers on the international capital markets.From this information we may surmise that they have a comparative advantage in

Accepted Answer

A) future income. 
B) present income. 
C) disposable income. 
D) capital goods. 
E) consumer goods. 
A) future income. 
B) present income. 
C) disposable income. 
D) capital goods. 
E) consumer goods.

Question 10

If the U.S.(a large country)imposes a tariff on its imported good,this will tend to

Accepted Answer

A) improve the terms of trade of all countries. 
B) have no effect on terms of trade. 
C) raise the world price of the good imported by the United States. 
D) improve the terms of trade of the United States. 
E) cause a deterioration of U.S.terms of trade. 
A) improve the terms of trade of all countries. 
B) have no effect on terms of trade. 
C) raise the world price of the good imported by the United States. 
D) improve the terms of trade of the United States. 
E) cause a deterioration of U.S.terms of trade.

Question 11

A country cannot produce a mix of products with a higher value than where

Accepted Answer

A) the isovalue line is tangent with the indifference curve. 
B) the isovalue line is below the production possibility frontier. 
C) the isovalue line is above the production possibility frontier. 
D) the isovalue line intersects the production possibility frontier. 
E) the isovalue line is tangent to the production possibility frontier. 
A) the isovalue line is tangent with the indifference curve. 
B) the isovalue line is below the production possibility frontier. 
C) the isovalue line is above the production possibility frontier. 
D) the isovalue line intersects the production possibility frontier. 
E) the isovalue line is tangent to the production possibility frontier.

Question 12

If the ratio of price of cloth (PC)divided by the price of food (PF)increases in the international marketplace,then

Accepted Answer

A) the terms of trade of cloth exporters will improve. 
B) the terms of trade of all countries will improve. 
C) all countries would be better off. 
D) the terms of trade of food exporters will improve. 
E) the terms of trade of cloth exporters will worsen. 
A) the terms of trade of cloth exporters will improve. 
B) the terms of trade of all countries will improve. 
C) all countries would be better off. 
D) the terms of trade of food exporters will improve. 
E) the terms of trade of cloth exporters will worsen.

An increase in a country's net commodity terms of trade will

Terms of trade refers to

An export subsidy will cause the terms of trade of the country to and will the country.

Tastes of individuals are represented by

The price of consumption in terms of _ consumption is .

If points A and B are two locations on a country's production possibility frontier,then

An import tariff will cause the relative demand for to and the relative supply for to .

If one observes that Japan was traditionally a net foreign lender,one could conclude that relative to its international trade and financial partners

Rapidly growing developing countries tend to be borrowers on the international capital markets.From this information we may surmise that they have a comparative advantage in

If the U.S.(a large country)imposes a tariff on its imported good,this will tend to

A country cannot produce a mix of products with a higher value than where

If the ratio of price of cloth (PC)divided by the price of food (PF)increases in the international marketplace,then

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

External Economies of Scale and the International Location of Production

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

The Instruments of Trade Policy

The Political Economy of Trade Policy

Trade Policy in Developing Countries

Controversies in Trade Policy

Filters

Exam 6: The Standard Trade Model

An increase in a country's net commodity terms of trade will

Terms of trade refers to

An export subsidy will cause the terms of trade of the country to and will the country.

Tastes of individuals are represented by

The price of consumption in terms of _ consumption is .

If points A and B are two locations on a country's production possibility frontier,then

An import tariff will cause the relative demand for to and the relative supply for to .

If one observes that Japan was traditionally a net foreign lender,one could conclude that relative to its international trade and financial partners

Rapidly growing developing countries tend to be borrowers on the international capital markets.From this information we may surmise that they have a comparative advantage in

If the U.S.(a large country)imposes a tariff on its imported good,this will tend to

A country cannot produce a mix of products with a higher value than where

If the ratio of price of cloth (PC)divided by the price of food (PF)increases in the international marketplace,then

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

External Economies of Scale and the International Location of Production

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

The Instruments of Trade Policy

The Political Economy of Trade Policy

Trade Policy in Developing Countries

Controversies in Trade Policy

Filters