Exam 6: Trade Regulations and Industrial Policies

Export embargoes induce greater losses in consumer surplus for the target country

The General Agreement on Tariffs and Trade was founded in 1995 as a successor to the World Trade Organization.

The implicit industrial policies of the U.S.government have included

Figure 6.4 Japanese Market for Jetliners -Consider the Japanese market for jetliners as depicted in Figure 6.4.Suppose the lone producer of jetliners in the world is Boeing, which faces a constant marginal cost of $20 million per jetliner.What price will Boeing charge for jetliners in the Japanese market and how many will they sell?

Which international organization stipulates procedures for the settlement of international trade disputes?

Critics of the U.S.Trade Adjustment Assistance Program argue that

Critics of the U.S.Trade Adjustment Assistance Program contend that it results in American companies exiting industries that are competitive in world markets.

The high point of U.S.protection culminated with the passage of the

Figure 6.2 illustrates the calculator market for Mexico, assumed to be a small nation that is unable to influence the South Korean (world) price. Assume the South Korean price to be $60 per calculator. Figure 6.2. Effects of an Export Subsidy -Consider Figure 6.2.For Mexico's producers and consumers as a whole, the South Korean subsidy leads to a(n)

If fast-track authority is approved and trade negotiations are completed, Congress must vote on the agreement (without amendment) within 90 legislative days of submission.

By reducing available supplies of a product, an export embargo leads to falling prices in the target nation and increasing target-nation consumer surplus.

The Export-Import Bank of the United States encourages American firms to sell overseas by providing direct loans and loan guarantees to foreign purchasers of American goods.To American firms, this represents a

Countervailing duties may be imposed

Members of the General Agreement on Tariffs and Trade and its successor, the World Trade Organization, agree to the principle of nondiscrimination in trade and the reduction of trade barriers by multilateral negotiations.

Figure 6.5 Japanese Market for Jetliners -Consider the Japanese market for jetliners as depicted in Figure 6.5.Suppose the lone producer of jetliners in the world is Boeing, which faces a constant marginal cost of $20 million per jetliner, but now a European manufacturer, Airbus, begins production.Airbus faces the same marginal cost as Boeing, but the European government provides Airbus with a subsidy of $8 million per jetliner produced.As a result of the competition, Boeing leaves the Japanese market leaving Airbus as a monopoly.How much profit will Airbus earn?

If higher labor standards were implemented as a condition for support of more liberal trade rules of the World Trade Organization, such policies could

One of the achievements of the Uruguay Round was the formation of the World Trade Organization.

The purpose of the U.S.Trade Adjustment Assistance Program is to

Figure 6.5 Japanese Market for Jetliners -Consider the Japanese market for jetliners as depicted in Figure 6.5.Suppose the lone producer of jetliners in the world is Boeing, which faces a constant marginal cost of $20 million per jetliner, but now a European manufacturer, Airbus, begins production.Airbus faces the same marginal cost as Boeing, but the European government provides Airbus with a subsidy of $8 million per jetliner produced.As a result of the competition, Boeing leaves the Japanese market, leaving Airbus as a monopoly.As a result of the entry of the subsidized producer, what will happen to the consumer surplus gained by Japanese airlines from buying jetliners?