Question 1

In the four- quadrant diagram of the specific factors model,the graph in the upper left quadrant is a country's

Accepted Answer

A) production function for cloth. 
B) labor supply curve. 
C) production possibility frontier. 
D) production function for food. 
E) labor allocation constraint. 
A) production function for cloth. 
B) labor supply curve. 
C) production possibility frontier. 
D) production function for food. 
E) labor allocation constraint. D

Question 2

U.S.imports of sugar are limited by an import quota that,according to a study updated in 2015,imposed a total cost on American consumers close to $ ,or an average cost of per year for every U.S.household.

Accepted Answer

A) $105 million; $3 
B) $3 billion; $2,000 
C) $370 million; $2,000 
D) $3 .5 billion; $30 
E) $2 billion; $110 
A) $105 million; $3 
B) $3 billion; $2,000 
C) $370 million; $2,000 
D) $3 .5 billion; $30 
E) $2 billion; $110 A

Question 3

U.S.imports of sugar are limited by an import quota that,according to a study updated in 2015,imposed annual losses on American consumers of

Accepted Answer

A) $1,500,000. 
B) $2,000,000. 
C) $200,000. 
D) $370,000. 
E) $1,000,000,000. 
A) $1,500,000. 
B) $2,000,000. 
C) $200,000. 
D) $370,000. 
E) $1,000,000,000. B

Question 4

Under perfect competition,the equilibrium price of labor used to produce cloth will be equal to

Accepted Answer

A) the ratio of the marginal product of labor in the production of cloth to the marginal product of labor in the production of food times the ratio of the price of cloth to the price of food. 
B) the marginal product of labor in the production of cloth times the price of cloth. 
C) the price of cloth divided by the marginal product of labor in the production of cloth. 
D) the average product of labor in the production of cloth times the price of cloth. 
E) the slope of the production possibility frontier. 
A) the ratio of the marginal product of labor in the production of cloth to the marginal product of labor in the production of food times the ratio of the price of cloth to the price of food. 
B) the marginal product of labor in the production of cloth times the price of cloth. 
C) the price of cloth divided by the marginal product of labor in the production of cloth. 
D) the average product of labor in the production of cloth times the price of cloth. 
E) the slope of the production possibility frontier.

Question 5

International trade can have important effects on the distribution of income because

Accepted Answer

A) rich countries take advantage of poor countries. 
B) the more powerful country dictates the terms of trade. 
C) different industries employ different factors of production. 
D) of government corruption. 
E) different countries use different currencies. 
A) rich countries take advantage of poor countries. 
B) the more powerful country dictates the terms of trade. 
C) different industries employ different factors of production. 
D) of government corruption. 
E) different countries use different currencies.

Question 6

In the specific factors model,which of the following will increase the quantity of labor used in cloth production?

Accepted Answer

A) an increase in the price of cloth relative to that of food 
B) a decrease in the price of labor 
C) an equal percentage decrease in the price of food and cloth 
D) an increase in the price of food relative to that of cloth 
E) an equal percentage increase in the price of food and cloth 
A) an increase in the price of cloth relative to that of food 
B) a decrease in the price of labor 
C) an equal percentage decrease in the price of food and cloth 
D) an increase in the price of food relative to that of cloth 
E) an equal percentage increase in the price of food and cloth

Question 7

Those who will lose from free trade are factors in sectors that produce goods that are .

Accepted Answer

A) mobile; exported 
B) immobile; exported 
C) immobile; also imported 
D) mobile; also imported 
E) mobile; untraded 
A) mobile; exported 
B) immobile; exported 
C) immobile; also imported 
D) mobile; also imported 
E) mobile; untraded

Question 8

Economists consider the effects of free trade on income distribution to be important than the effects on overall welfare because .

Accepted Answer

A) less; the wealthy benefit and only the poor lose 
B) more; the effects on income distribution are major and consequential 
C) less; many factors besides trade affect income distribution 
D) less; the effects on income distribution are minor and inconsequential 
E) more; those who are harmed are not compensated by those who gain 
A) less; the wealthy benefit and only the poor lose 
B) more; the effects on income distribution are major and consequential 
C) less; many factors besides trade affect income distribution 
D) less; the effects on income distribution are minor and inconsequential 
E) more; those who are harmed are not compensated by those who gain

Question 9

There is a bias in the political process against free trade because

Accepted Answer

A) those who lose from free trade are better organized than those who gain. 
B) those who gain from free trade can't compensate those who lose. 
C) there is a high correlation between the volume of imports and the unemployment rate. 
D) foreign governments make large donations to U.S.political campaigns. 
E) the gains from free trade cannot be measured. 
A) those who lose from free trade are better organized than those who gain. 
B) those who gain from free trade can't compensate those who lose. 
C) there is a high correlation between the volume of imports and the unemployment rate. 
D) foreign governments make large donations to U.S.political campaigns. 
E) the gains from free trade cannot be measured.

Question 10

In the specific factors model,which of the following is treated as a specific factor?

Accepted Answer

A) cloth 
B) technology 
C) food 
D) capital 
E) labor 
A) cloth 
B) technology 
C) food 
D) capital 
E) labor

Question 11

In the two- country model of international labor mobility

Accepted Answer

A) the long- run equilibrium global real wage is equal to the greater of the pre- migration wages in the two countries. 
B) the effect of migration is to cause real wages in the two countries to converge. 
C) the effect of migration is to cause real wages in the two countries to diverge. 
D) labor has only limited international mobility. 
E) the long- run equilibrium global real wage is equal to the lesser of the pre- migration wages in the two countries. 
A) the long- run equilibrium global real wage is equal to the greater of the pre- migration wages in the two countries. 
B) the effect of migration is to cause real wages in the two countries to converge. 
C) the effect of migration is to cause real wages in the two countries to diverge. 
D) labor has only limited international mobility. 
E) the long- run equilibrium global real wage is equal to the lesser of the pre- migration wages in the two countries.

Question 12

In the four- quadrant diagram of the specific factors model,the graph in the lower right quadrant is a country's

Accepted Answer

A) production function for cloth. 
B) labor allocation constraint. 
C) labor supply curve. 
D) production function for food. 
E) production possibility frontier. 
A) production function for cloth. 
B) labor allocation constraint. 
C) labor supply curve. 
D) production function for food. 
E) production possibility frontier.

Question 13

A country's budget constraint states that

Accepted Answer

A) a country will engage in trade only if the value of goods produced exceeds the value of goods consumed. 
B) real income in the exporting country must be equal to real income in the importing country. 
C) whether or not a country engages in trade,the value of goods consumed must be equal to the value of goods produced. 
D) unless a country engages in trade,the value of goods consumed cannot exceed the value of goods produced. 
E) a country will engage in trade only if the value of goods consumed exceeds the value of goods produced. 
A) a country will engage in trade only if the value of goods produced exceeds the value of goods consumed. 
B) real income in the exporting country must be equal to real income in the importing country. 
C) whether or not a country engages in trade,the value of goods consumed must be equal to the value of goods produced. 
D) unless a country engages in trade,the value of goods consumed cannot exceed the value of goods produced. 
E) a country will engage in trade only if the value of goods consumed exceeds the value of goods produced.

Question 14

U.S.imports of sugar are limited by an import quota that,according to a study updated in 2015,imposed a total cost on American consumers close to $ ,or an average consumer cost of over per year for every job saved in the U.S sugar industry.

Accepted Answer

A) $2 billion; $110 
B) $3 billion; $10 
C) $3.5 billion; $3,000,000 
D) $370 million; $20 
E) $105 million; $3 
A) $2 billion; $110 
B) $3 billion; $10 
C) $3.5 billion; $3,000,000 
D) $370 million; $20 
E) $105 million; $3

Question 15

In the specific factors model,a 5% increase in the price of food accompanied by a 5% increase in the price of cloth will cause in the welfare of labor,in the welfare of the fixed factor in the production of food,and in the welfare of the fixed factor in the production of cloth.

Accepted Answer

A) an increase; a decrease; a decrease 
B) no change; no change; no change 
C) a decrease; an increase; an increase 
D) an increase; an increase; an increase 
E) a decrease; a decrease; a decrease 
A) an increase; a decrease; a decrease 
B) no change; no change; no change 
C) a decrease; an increase; an increase 
D) an increase; an increase; an increase 
E) a decrease; a decrease; a decrease

Question 16

The degree of a factor's specificity is inversely related to

Accepted Answer

A) the mobility of the factor,with more mobile factors having less specificity. 
B) the cost of the factor as a proportion of the long- run total cost of production. 
C) the amount of time required to redeploy the factor to a different industry. 
D) technology differences between two countries,with a less advanced technology resulting in less factor specificity. 
E) factor quality,with lower quality factors having a lower level of specificity. 
A) the mobility of the factor,with more mobile factors having less specificity. 
B) the cost of the factor as a proportion of the long- run total cost of production. 
C) the amount of time required to redeploy the factor to a different industry. 
D) technology differences between two countries,with a less advanced technology resulting in less factor specificity. 
E) factor quality,with lower quality factors having a lower level of specificity.

Question 17

The Ricardian model of international trade demonstrates that trade can be mutually beneficial.Why,then,do governments restrict imports of some goods?

Accepted Answer

A) Import restrictions are the result of trade wars between hostile countries. 
B) The Ricardian model is often incorrect in its prediction that trade can be mutually beneficial. 
C) Restrictions on imports are intended to benefit domestic consumers. 
D) Trade can have substantial effects on a country's distribution of income. 
E) Imports are only restricted when foreign- made goods do not meet domestic standards of quality. 
A) Import restrictions are the result of trade wars between hostile countries. 
B) The Ricardian model is often incorrect in its prediction that trade can be mutually beneficial. 
C) Restrictions on imports are intended to benefit domestic consumers. 
D) Trade can have substantial effects on a country's distribution of income. 
E) Imports are only restricted when foreign- made goods do not meet domestic standards of quality.

Question 18

Immigration into the U.S.over the past century has caused the percentage of immigrants in the U.S.population to

Accepted Answer

A) fall steadily over the entire century. 
B) rise steadily until the 1970s and fall thereafter. 
C) remain relatively constant over the time period. 
D) fall steadily until the 1970s and increase thereafter. 
E) rise steadily over the entire century. 
A) fall steadily over the entire century. 
B) rise steadily until the 1970s and fall thereafter. 
C) remain relatively constant over the time period. 
D) fall steadily until the 1970s and increase thereafter. 
E) rise steadily over the entire century.

Question 19

The degree of a factor's specificity is directly related to

Accepted Answer

A) factor quality,with higher quality factors having a higher level of specificity. 
B) technology differences between two countries,with a more advanced technology resulting in more factor specificity. 
C) the mobility of the factor,with more mobile factors having more specificity. 
D) the amount of time required to redeploy the factor to a different industry. 
E) the cost of the factor as a proportion of the long- run total cost of production. 
A) factor quality,with higher quality factors having a higher level of specificity. 
B) technology differences between two countries,with a more advanced technology resulting in more factor specificity. 
C) the mobility of the factor,with more mobile factors having more specificity. 
D) the amount of time required to redeploy the factor to a different industry. 
E) the cost of the factor as a proportion of the long- run total cost of production.

Question 20

In the specific factors model,a 0% increase in the price of food accompanied by a 5% increase in the price of cloth will cause wages to _,the production of cloth to _,and the production of food to .

Accepted Answer

A) remain constant; decrease; decrease 
B) increase by more then 5%; increase; remain unchanged 
C) remain constant; increase; increase 
D) increase by less then 5%; increase; decrease 
E) increase by 5%; remain unchanged; remain unchanged 
A) remain constant; decrease; decrease 
B) increase by more then 5%; increase; remain unchanged 
C) remain constant; increase; increase 
D) increase by less then 5%; increase; decrease 
E) increase by 5%; remain unchanged; remain unchanged

In the four- quadrant diagram of the specific factors model,the graph in the upper left quadrant is a country's

U.S.imports of sugar are limited by an import quota that,according to a study updated in 2015,imposed a total cost on American consumers close to $ ,or an average cost of per year for every U.S.household.

U.S.imports of sugar are limited by an import quota that,according to a study updated in 2015,imposed annual losses on American consumers of

Under perfect competition,the equilibrium price of labor used to produce cloth will be equal to

International trade can have important effects on the distribution of income because

In the specific factors model,which of the following will increase the quantity of labor used in cloth production?

Those who will lose from free trade are factors in sectors that produce goods that are .

Economists consider the effects of free trade on income distribution to be important than the effects on overall welfare because .

There is a bias in the political process against free trade because

In the specific factors model,which of the following is treated as a specific factor?

In the two- country model of international labor mobility

In the four- quadrant diagram of the specific factors model,the graph in the lower right quadrant is a country's

A country's budget constraint states that

U.S.imports of sugar are limited by an import quota that,according to a study updated in 2015,imposed a total cost on American consumers close to $ ,or an average consumer cost of over per year for every job saved in the U.S sugar industry.

In the specific factors model,a 5% increase in the price of food accompanied by a 5% increase in the price of cloth will cause in the welfare of labor,in the welfare of the fixed factor in the production of food,and in the welfare of the fixed factor in the production of cloth.

The degree of a factor's specificity is inversely related to

The Ricardian model of international trade demonstrates that trade can be mutually beneficial.Why,then,do governments restrict imports of some goods?

Immigration into the U.S.over the past century has caused the percentage of immigrants in the U.S.population to

The degree of a factor's specificity is directly related to

In the specific factors model,a 0% increase in the price of food accompanied by a 5% increase in the price of cloth will cause wages to _,the production of cloth to _,and the production of food to .

Introduction

World Trade: an Overview

Labor Productivity and Comparative Advantage: the Ricardian Model

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 Instruments of Trade Policy

The Political Economy of Trade Policy

Trade Policy in Developing Countries

Controversies in Trade Policy

Filters

Exam 4: Specific Factors and Income Distribution

In the four- quadrant diagram of the specific factors model,the graph in the upper left quadrant is a country's

U.S.imports of sugar are limited by an import quota that,according to a study updated in 2015,imposed a total cost on American consumers close to $ ,or an average cost of per year for every U.S.household.

U.S.imports of sugar are limited by an import quota that,according to a study updated in 2015,imposed annual losses on American consumers of

Under perfect competition,the equilibrium price of labor used to produce cloth will be equal to

International trade can have important effects on the distribution of income because

In the specific factors model,which of the following will increase the quantity of labor used in cloth production?

Those who will lose from free trade are factors in sectors that produce goods that are .

Economists consider the effects of free trade on income distribution to be important than the effects on overall welfare because .

There is a bias in the political process against free trade because

In the specific factors model,which of the following is treated as a specific factor?

In the two- country model of international labor mobility

In the four- quadrant diagram of the specific factors model,the graph in the lower right quadrant is a country's

A country's budget constraint states that

U.S.imports of sugar are limited by an import quota that,according to a study updated in 2015,imposed a total cost on American consumers close to $ ,or an average consumer cost of over per year for every job saved in the U.S sugar industry.

In the specific factors model,a 5% increase in the price of food accompanied by a 5% increase in the price of cloth will cause in the welfare of labor,in the welfare of the fixed factor in the production of food,and in the welfare of the fixed factor in the production of cloth.

The degree of a factor's specificity is inversely related to

The Ricardian model of international trade demonstrates that trade can be mutually beneficial.Why,then,do governments restrict imports of some goods?

Immigration into the U.S.over the past century has caused the percentage of immigrants in the U.S.population to

The degree of a factor's specificity is directly related to

In the specific factors model,a 0% increase in the price of food accompanied by a 5% increase in the price of cloth will cause wages to _,the production of cloth to _,and the production of food to .

Introduction

World Trade: an Overview

Labor Productivity and Comparative Advantage: the Ricardian Model

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 Instruments of Trade Policy

The Political Economy of Trade Policy

Trade Policy in Developing Countries

Controversies in Trade Policy

Filters