Question 1

The World Trade Organization

Accepted Answer

A) was set up to increase tariffs among nations. 
B) was set up to negotiate exchange rates between countries. 
C) was set up to decrease tariffs among nations. 
D) handles trade disputes among its member nations. 
A) was set up to increase tariffs among nations. 
B) was set up to negotiate exchange rates between countries. 
C) was set up to decrease tariffs among nations. 
D) handles trade disputes among its member nations.

Question 2

When economists David Gould, G.L. Woodbridge, and Roy Ruffin examined the data on the relationship between increases in imports and the rate of unemployment, they concluded that

Accepted Answer

A) free trade leads to increased unemployment. 
B) there is not a causal link between increases in imports and the rate of unemployment. 
C) increases in imports always precede increases in unemployment by a period of 6 months to one year. 
D) increases in unemployment always precede increases in imports by a period of 6 months to one year. 
A) free trade leads to increased unemployment. 
B) there is not a causal link between increases in imports and the rate of unemployment. 
C) increases in imports always precede increases in unemployment by a period of 6 months to one year. 
D) increases in unemployment always precede increases in imports by a period of 6 months to one year.

Question 3

The argument that trade in high-tech equipment can facilitate the implementation of advanced military technology in countries that may become strategic opponents later on is the

Accepted Answer

A) national security argument. 
B) infant industry argument. 
C) protecting domestic jobs argument. 
D) environmental and safety argument. 
A) national security argument. 
B) infant industry argument. 
C) protecting domestic jobs argument. 
D) environmental and safety argument.

Question 4

One way tariffs differ from quotas is that

Accepted Answer

A) tariffs produce revenues for the importing country's government. 
B) quotas produce revenues for the exporting country's government. 
C) tariffs produce no revenues but set limits on the imported items. 
D) tariffs are applied only on raw materials. 
A) tariffs produce revenues for the importing country's government. 
B) quotas produce revenues for the exporting country's government. 
C) tariffs produce no revenues but set limits on the imported items. 
D) tariffs are applied only on raw materials.

Question 5

The Number of Worker Days to Produce One
Cuckoo Clock or Movie Using All Available Resources
U.S. Switzerland
Product (Worker-Days)(Worker-Days)
Cuckoo Clocks 8 6
Movies 12 4
-Which of the following is a TRUE statement?

Accepted Answer

A) Everyone benefits from free trade. 
B) Exporters benefit from trade and importers do not. 
C) Consumers benefit from trade and producers do not. 
D) Free trade harms domestic producers of goods that face import competition. 
A) Everyone benefits from free trade. 
B) Exporters benefit from trade and importers do not. 
C) Consumers benefit from trade and producers do not. 
D) Free trade harms domestic producers of goods that face import competition.

Question 6

The Uruguay round of GATT (1993)talks

Accepted Answer

A) reduced trade barriers and tariffs. 
B) increased trade barriers and tariffs. 
C) lowered some trade barriers but increased tariffs. 
D) left tariffs and trade barriers unchanged. 
A) reduced trade barriers and tariffs. 
B) increased trade barriers and tariffs. 
C) lowered some trade barriers but increased tariffs. 
D) left tariffs and trade barriers unchanged.

Question 7

Discuss the relationship between U.S. competitiveness relative to other countries and standards of living in the United States.

Accepted Answer

There is very little relationship betwee

Question 8

In an hour Jane can solder 50 connections or inspect 20 parts while Jim can solder 25 connections or inspect 20 parts in an hour.

Accepted Answer

A) Jane has a comparative advantage over Jim in both soldering and inspecting. 
B) Jane has a comparative advantage over Jim in soldering while Jim has a comparative advantage in inspecting. 
C) Jim has a comparative advantage over Jane in soldering while Jane has a comparative advantage in inspecting. 
D) Jim had a comparative advantage over Jane in both soldering and inspecting. 
A) Jane has a comparative advantage over Jim in both soldering and inspecting. 
B) Jane has a comparative advantage over Jim in soldering while Jim has a comparative advantage in inspecting. 
C) Jim has a comparative advantage over Jane in soldering while Jane has a comparative advantage in inspecting. 
D) Jim had a comparative advantage over Jane in both soldering and inspecting.

Question 9

Comparative advantage is the ability, compared with another producer,

Accepted Answer

A) to produce more of a product with the same resources. 
B) to use fewer inputs to produce the same amount of a product. 
C) to produce a higher-quality product with fewer resources. 
D) to produce an additional unit of a product at lower opportunity cost. 
A) to produce more of a product with the same resources. 
B) to use fewer inputs to produce the same amount of a product. 
C) to produce a higher-quality product with fewer resources. 
D) to produce an additional unit of a product at lower opportunity cost.

Question 10

A tariff is a tax on

Accepted Answer

A) all exported goods imposed by the WTO. 
B) imported goods. 
C) shipping containers. 
D) foreign exchange transactions. 
A) all exported goods imposed by the WTO. 
B) imported goods. 
C) shipping containers. 
D) foreign exchange transactions.

Question 11

The ability to produce a good or service at a lower opportunity cost than other producers is

Accepted Answer

A) absolute advantage. 
B) comparative advantage. 
C) opportunity advantage. 
D) special advantage. 
A) absolute advantage. 
B) comparative advantage. 
C) opportunity advantage. 
D) special advantage.

Question 12

Groups of nations that grants members trade privileges are called

Accepted Answer

A) local trade protectionists. 
B) trade settlements. 
C) regional trade blocs. 
D) allies. 
A) local trade protectionists. 
B) trade settlements. 
C) regional trade blocs. 
D) allies.

Question 13

The WTO

Accepted Answer

A) is an affiliate of the World Bank. 
B) is an organization created to oversee NAFTA. 
C) was established to resolve trade disputes among member nations. 
D) provides low interest loans to member nations to help develop their export industries. 
A) is an affiliate of the World Bank. 
B) is an organization created to oversee NAFTA. 
C) was established to resolve trade disputes among member nations. 
D) provides low interest loans to member nations to help develop their export industries.

Question 14

What is the relationship between imports and employment?

Accepted Answer

There is no causal link between imports

Question 15

The ability to produce an item at a lower opportunity cost compared with other producers is known as

Accepted Answer

A) competitive dominance. 
B) productive dominance. 
C) comparative advantage. 
D) absolute advantage. 
A) competitive dominance. 
B) productive dominance. 
C) comparative advantage. 
D) absolute advantage.

Question 16

Which of the reasons given for tariff protection make consumers better off by generating lower prices?

Accepted Answer

A) infant industry argument 
B) protecting U.S. jobs argument 
C) anti-dumping argument 
D) None provides lower prices for domestic consumers. 
A) infant industry argument 
B) protecting U.S. jobs argument 
C) anti-dumping argument 
D) None provides lower prices for domestic consumers.

Question 17

International trade is based on the existence of

Accepted Answer

A) absolute advantage. 
B) perfect advantage. 
C) productivity advantage. 
D) comparative advantage. 
A) absolute advantage. 
B) perfect advantage. 
C) productivity advantage. 
D) comparative advantage.

Question 18

If in the long run, any government policy that increases exports

Accepted Answer

A) also increases imports. 
B) decreases imports. 
C) has no impact on imports. 
D) makes imports become negative. 
A) also increases imports. 
B) decreases imports. 
C) has no impact on imports. 
D) makes imports become negative.

Question 19

Import restrictions due to the imposition of tariffs by the U.S. government

Accepted Answer

A) will ultimately cause inefficient resource allocation in the United States. 
B) will lead to lower incomes in the economy of U.S. trade partners. 
C) will lead to a decline in the quantity of the product consumed in the United States. 
D) all of the above are likely to occur 
A) will ultimately cause inefficient resource allocation in the United States. 
B) will lead to lower incomes in the economy of U.S. trade partners. 
C) will lead to a decline in the quantity of the product consumed in the United States. 
D) all of the above are likely to occur

Question 20

The Number of Worker Days to Produce One
Cuckoo Clock or Movie Using All Available Resources
U.S. Switzerland
Product (Worker-Days)(Worker-Days)
Cuckoo Clocks 8 6
Movies 12 4
-Assume that maximum feasible hourly productions levels if all resources are utilized in the United States are either 8 yards of fabric or 4 bushels of wheat. Maximum feasible production levels if all resources are utilized in Japan are either 3 yards of fabric or 6 bushels of wheat. Based on this information

Accepted Answer

A) beneficial trade is absolutely impossible between the two countries. 
B) the United States will benefit from trading but Japan will not. 
C) both nations will gain from specialization and trade, with the United States exporting wheat and Japan exporting fabric. 
D) both nations will gain from specialization and trade, with the United States exporting fabric and Japan exporting wheat. 
A) beneficial trade is absolutely impossible between the two countries. 
B) the United States will benefit from trading but Japan will not. 
C) both nations will gain from specialization and trade, with the United States exporting wheat and Japan exporting fabric. 
D) both nations will gain from specialization and trade, with the United States exporting fabric and Japan exporting wheat.

The World Trade Organization

When economists David Gould, G.L. Woodbridge, and Roy Ruffin examined the data on the relationship between increases in imports and the rate of unemployment, they concluded that

The argument that trade in high-tech equipment can facilitate the implementation of advanced military technology in countries that may become strategic opponents later on is the

One way tariffs differ from quotas is that

The Number of Worker Days to Produce One Cuckoo Clock or Movie Using All Available Resources U.S. Switzerland Product (Worker-Days)(Worker-Days) Cuckoo Clocks 8 6 Movies 12 4 -Which of the following is a TRUE statement?

The Uruguay round of GATT (1993)talks

Discuss the relationship between U.S. competitiveness relative to other countries and standards of living in the United States.

In an hour Jane can solder 50 connections or inspect 20 parts while Jim can solder 25 connections or inspect 20 parts in an hour.

Comparative advantage is the ability, compared with another producer,

A tariff is a tax on

The ability to produce a good or service at a lower opportunity cost than other producers is

Groups of nations that grants members trade privileges are called

The WTO

What is the relationship between imports and employment?

The ability to produce an item at a lower opportunity cost compared with other producers is known as

Which of the reasons given for tariff protection make consumers better off by generating lower prices?

International trade is based on the existence of

If in the long run, any government policy that increases exports

Import restrictions due to the imposition of tariffs by the U.S. government

The Nature of Economics

Scarcity and the World of Trade-Offs

Demand and Supply

Extensions of Demand and Supply Analysis

Public Spending and Public Choice

Funding the Public Sector

Demand and Supply Elasticity

Consumer Choice

Rents, Profits, and the Financial Environment of Business

The Firm: Cost and Output Determination

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly and Strategic Behavior

Regulation and Antitrust Policy in a Globalized Economy

The Labor Market: Demand, Supply and Outsourcing

Unions and Labor Market Monopoly Power

Income, Poverty, and Health Care

Environmental Economics

Exchange Rates and the Balance of Payments

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Exam 32: Comparative Advantage and the Open Economy

The World Trade Organization

When economists David Gould, G.L. Woodbridge, and Roy Ruffin examined the data on the relationship between increases in imports and the rate of unemployment, they concluded that

The argument that trade in high-tech equipment can facilitate the implementation of advanced military technology in countries that may become strategic opponents later on is the

One way tariffs differ from quotas is that

The Number of Worker Days to Produce One Cuckoo Clock or Movie Using All Available Resources U.S. Switzerland Product (Worker-Days)(Worker-Days) Cuckoo Clocks 8 6 Movies 12 4 -Which of the following is a TRUE statement?

The Uruguay round of GATT (1993)talks

Discuss the relationship between U.S. competitiveness relative to other countries and standards of living in the United States.

In an hour Jane can solder 50 connections or inspect 20 parts while Jim can solder 25 connections or inspect 20 parts in an hour.

Comparative advantage is the ability, compared with another producer,

A tariff is a tax on

The ability to produce a good or service at a lower opportunity cost than other producers is

Groups of nations that grants members trade privileges are called

The WTO

What is the relationship between imports and employment?

The ability to produce an item at a lower opportunity cost compared with other producers is known as

Which of the reasons given for tariff protection make consumers better off by generating lower prices?

International trade is based on the existence of

If in the long run, any government policy that increases exports

Import restrictions due to the imposition of tariffs by the U.S. government

The Nature of Economics

Scarcity and the World of Trade-Offs

Demand and Supply

Extensions of Demand and Supply Analysis

Public Spending and Public Choice

Funding the Public Sector

Demand and Supply Elasticity

Consumer Choice

Rents, Profits, and the Financial Environment of Business

The Firm: Cost and Output Determination

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly and Strategic Behavior

Regulation and Antitrust Policy in a Globalized Economy

The Labor Market: Demand, Supply and Outsourcing

Unions and Labor Market Monopoly Power

Income, Poverty, and Health Care

Environmental Economics

Exchange Rates and the Balance of Payments

Filters