Question 1

For most developing countries:

Accepted Answer

A)  Productivity is high among domestic workers 
B)  Population-growth and illiteracy rates are low 
C)  Saving and investment levels are high 
D)  Agricultural goods and raw materials constitute much of domestic output 
A)  Productivity is high among domestic workers 
B)  Population-growth and illiteracy rates are low 
C)  Saving and investment levels are high 
D)  Agricultural goods and raw materials constitute much of domestic output

Question 2

Which method has $\underline { \text { not }   }$ generally been used by the international commodity agreements to stabilize commodity prices?

Accepted Answer

A)  Production quotas applied to the level of commodity output 
B)  Buffer stock arrangements among producing nations 
C)  Export restrictions applied to international sales of commodities 
D)  Measures to nationalize foreign-owned production operations 
A)  Production quotas applied to the level of commodity output 
B)  Buffer stock arrangements among producing nations 
C)  Export restrictions applied to international sales of commodities 
D)  Measures to nationalize foreign-owned production operations

Question 3

Figure 7.3. World Oil Market
  
-Consider Figure 7.3. Under a profit-maximizing cartel, the quantity of oil produced equals:

Accepted Answer

A)  40 barrels 
B)  70 barrels 
C)  90 barrels 
D)  110 barrels 
A)  40 barrels 
B)  70 barrels 
C)  90 barrels 
D)  110 barrels

Question 4

Concerning the hypothesis that there has occurred a long-run deterioration in the developing countries' terms of trade, empirical studies provide:

Accepted Answer

A)  Mixed evidence that does not substantiate the deterioration hypothesis 
B)  Overwhelming support for the deterioration hypothesis 
C)  Overwhelming opposition to the deterioration hypothesis 
D)  None of the above 
A)  Mixed evidence that does not substantiate the deterioration hypothesis 
B)  Overwhelming support for the deterioration hypothesis 
C)  Overwhelming opposition to the deterioration hypothesis 
D)  None of the above

Question 5

The "newly industrializing countries" of East Asia have emphasized the implementation of import-substitution policies to insulate their industries from international competition.

Accepted Answer

A) True 
 B)False

Question 6

East Asian economies have performed well by

Accepted Answer

A)  Obtaining foreign technology 
B)  Remaining open to international trade 
C)  Investing in their people 
D)  All of the above 
A)  Obtaining foreign technology 
B)  Remaining open to international trade 
C)  Investing in their people 
D)  All of the above

Question 7

Which of the following situations $\underline { \text { reduces }   }$ the likelihood of successful operation of a cartel?

Accepted Answer

A)  Cartel sales experience a rapid expansion 
B)  The demand for cartel output is price inelastic 
C)  The number of firms in the cartel is large 
D)  It is very difficult for new firms to enter the market 
A)  Cartel sales experience a rapid expansion 
B)  The demand for cartel output is price inelastic 
C)  The number of firms in the cartel is large 
D)  It is very difficult for new firms to enter the market

Question 8

Figure 7.3. World Oil Market
  
-Consider Figure 7.3. Under competitive conditions, producer profits total:

Accepted Answer

A)  $0 
B)  $140 
C)  $200 
D)  $280 
A)  $0 
B)  $140 
C)  $200 
D)  $280

Question 9

Assuming identical cost and demand curves, OPEC as a cartel will, in comparison to a competitive industry:

Accepted Answer

A)  Produce greater output and charge a lower price 
B)  Produce greater output and charge a higher price 
C)  Produce less output and charge a higher price 
D)  Produce less output and charge a lower price 
A)  Produce greater output and charge a lower price 
B)  Produce greater output and charge a higher price 
C)  Produce less output and charge a higher price 
D)  Produce less output and charge a lower price

Question 10

Figure 7.4 Global Market for Tin
  
-Consider the global market for tin represented by figure 7.4. Initially equilibrium is at point A with a market price of $3.50 per pound and 50,000 pounds. In ordr to keep tin price relatively stable an International Tin Agreement has set a price floor of $3.27 and a ceiling of $4.02. As the demand for tin increases to D1 how will the buffer-stock manager need to respond?

Accepted Answer

A)  buy 10,000 pounds of tin 
B)  buy 20,000 pounds of tin 
C)  sell 10,000 pounds of tin 
D)  sell 20,000 pounds of tin 
A)  buy 10,000 pounds of tin 
B)  buy 20,000 pounds of tin 
C)  sell 10,000 pounds of tin 
D)  sell 20,000 pounds of tin

Question 11

Figure 7.3. World Oil Market
  
-Consider Figure 7.3. Under competitive conditions, the price of a barrel of oil equals:

Accepted Answer

A)  $7 
B)  $11 
C)  $12 
D)  $16 
A)  $7 
B)  $11 
C)  $12 
D)  $16

Question 12

Figure 7.3. World Oil Market
  
-Consider Figure 7.3. Under competitive conditions, the quantity of oil produced equals:

Accepted Answer

A)  40 barrels 
B)  70 barrels 
C)  90 barrels 
D)  110 barrels 
A)  40 barrels 
B)  70 barrels 
C)  90 barrels 
D)  110 barrels

Question 13

Which of the following is $\underline { \text { not }   }$ a major factor that encourages developing nations to form international commodity agreements?

Accepted Answer

A)  Inelastic commodity supply schedules 
B)  Inelastic commodity demand schedules 
C)  Export markets that tend to be unstable 
D)  Secular increases in their terms of trade 
A)  Inelastic commodity supply schedules 
B)  Inelastic commodity demand schedules 
C)  Export markets that tend to be unstable 
D)  Secular increases in their terms of trade

Question 14

The majority of developing-nation exports are primary products such as agricultural goods and raw materials; of the manufactured goods exported by developing nations, most are labor-intensive goods.

Accepted Answer

A) True 
 B)False

Question 15

If the demand for coffee is price inelastic, an increase in the supply of coffee leads to falling prices and rising sales revenues.

Accepted Answer

A) True 
 B)False

Question 16

It is widely agreed that import-substitution policies have been a main contributor to above-average growth rates in developing countries.

Accepted Answer

A) True 
 B)False

Question 17

Which trade strategy have developing countries used to restrict imports of manufactured goods so that the domestic market is preserved for home producers, who thus can take over markets already established in the country?

Accepted Answer

A)  International commodity agreement 
B)  Export promotion 
C)  Multilateral contract 
D)  Import substitution 
A)  International commodity agreement 
B)  Export promotion 
C)  Multilateral contract 
D)  Import substitution

Question 18

Hong Kong and South Korea are examples of developing nations that have recently pursued industrialization policies.

Accepted Answer

A)  Import substitution 
B)  Export promotion 
C)  Commercial dumping 
D)  Multilateral contract 
A)  Import substitution 
B)  Export promotion 
C)  Commercial dumping 
D)  Multilateral contract

Question 19

In recent decades, the East Asian "newly industrializing countries" have pursued export-led growth (outward orientation) as an industrialization strategy.

Accepted Answer

A) True 
 B)False

Question 20

If the demand schedule for bauxite is relatively $\underline {  \text { inelastic }  }$ to price changes, an $\underline {  \text { increase }  }$ in the supply schedule of bauxite will cause a:

Accepted Answer

A)  Decrease in price and a decrease in sales revenue 
B)  Decrease in price and an increase in sales revenue 
C)  Increase in price and a decrease in sales revenue 
D)  Increase in price and an increase in sales revenue 
A)  Decrease in price and a decrease in sales revenue 
B)  Decrease in price and an increase in sales revenue 
C)  Increase in price and a decrease in sales revenue 
D)  Increase in price and an increase in sales revenue

For most developing countries:

Which method has $\underline { \text { not } }$ generally been used by the international commodity agreements to stabilize commodity prices?

Figure 7.3. World Oil Market -Consider Figure 7.3. Under a profit-maximizing cartel, the quantity of oil produced equals:

Concerning the hypothesis that there has occurred a long-run deterioration in the developing countries' terms of trade, empirical studies provide:

The "newly industrializing countries" of East Asia have emphasized the implementation of import-substitution policies to insulate their industries from international competition.

East Asian economies have performed well by

Which of the following situations $\underline { \text { reduces } }$ the likelihood of successful operation of a cartel?

Figure 7.3. World Oil Market -Consider Figure 7.3. Under competitive conditions, producer profits total:

Assuming identical cost and demand curves, OPEC as a cartel will, in comparison to a competitive industry:

Figure 7.3. World Oil Market -Consider Figure 7.3. Under competitive conditions, the price of a barrel of oil equals:

Figure 7.3. World Oil Market -Consider Figure 7.3. Under competitive conditions, the quantity of oil produced equals:

Which of the following is $\underline { \text { not } }$ a major factor that encourages developing nations to form international commodity agreements?

The majority of developing-nation exports are primary products such as agricultural goods and raw materials; of the manufactured goods exported by developing nations, most are labor-intensive goods.

If the demand for coffee is price inelastic, an increase in the supply of coffee leads to falling prices and rising sales revenues.

It is widely agreed that import-substitution policies have been a main contributor to above-average growth rates in developing countries.

Which trade strategy have developing countries used to restrict imports of manufactured goods so that the domestic market is preserved for home producers, who thus can take over markets already established in the country?

Hong Kong and South Korea are examples of developing nations that have recently pursued industrialization policies.

In recent decades, the East Asian "newly industrializing countries" have pursued export-led growth (outward orientation) as an industrialization strategy.

If the demand schedule for bauxite is relatively $\underline { \text { inelastic } }$ to price changes, an $\underline { \text { increase } }$ in the supply schedule of bauxite will cause a:

The International Economy and Globalization

Foundations of Modern Trade Theory: Comparative Advantage

Sources of Comparative Advantage

Tariffs

Nontariff Trade Barriers

Trade Regulations and Industrial Policies

Regional Trading Arrangements

International Factor Movements and Multinational Enterprises

The Balance of Payments

Foreign Exchange

Exchange-Rate Determination

Mechanisms of International Adjustment

Exchange-Rate Adjustments and the Balance of Payments

Exchange-Rate Systems and Currency Crises

Macroeconomic Policy in an Open Economy

International Banking: Reserves, Debt, and Risk

Filters

Exam 7: Trade Policies for the Developing Nations

For most developing countries:

Which method has not ‾\underline { \text { not } } not ​ generally been used by the international commodity agreements to stabilize commodity prices?

Figure 7.3. World Oil Market -Consider Figure 7.3. Under a profit-maximizing cartel, the quantity of oil produced equals:

Concerning the hypothesis that there has occurred a long-run deterioration in the developing countries' terms of trade, empirical studies provide:

The "newly industrializing countries" of East Asia have emphasized the implementation of import-substitution policies to insulate their industries from international competition.

East Asian economies have performed well by

Which of the following situations reduces ‾\underline { \text { reduces } } reduces ​ the likelihood of successful operation of a cartel?

Figure 7.3. World Oil Market -Consider Figure 7.3. Under competitive conditions, producer profits total:

Assuming identical cost and demand curves, OPEC as a cartel will, in comparison to a competitive industry:

Figure 7.3. World Oil Market -Consider Figure 7.3. Under competitive conditions, the price of a barrel of oil equals:

Figure 7.3. World Oil Market -Consider Figure 7.3. Under competitive conditions, the quantity of oil produced equals:

Which of the following is not ‾\underline { \text { not } } not ​ a major factor that encourages developing nations to form international commodity agreements?

The majority of developing-nation exports are primary products such as agricultural goods and raw materials; of the manufactured goods exported by developing nations, most are labor-intensive goods.

If the demand for coffee is price inelastic, an increase in the supply of coffee leads to falling prices and rising sales revenues.

It is widely agreed that import-substitution policies have been a main contributor to above-average growth rates in developing countries.

Which trade strategy have developing countries used to restrict imports of manufactured goods so that the domestic market is preserved for home producers, who thus can take over markets already established in the country?

Hong Kong and South Korea are examples of developing nations that have recently pursued industrialization policies.

In recent decades, the East Asian "newly industrializing countries" have pursued export-led growth (outward orientation) as an industrialization strategy.

If the demand schedule for bauxite is relatively inelastic ‾\underline { \text { inelastic } } inelastic ​ to price changes, an increase ‾\underline { \text { increase } } increase ​ in the supply schedule of bauxite will cause a:

The International Economy and Globalization

Foundations of Modern Trade Theory: Comparative Advantage

Sources of Comparative Advantage

Tariffs

Nontariff Trade Barriers

Trade Regulations and Industrial Policies

Regional Trading Arrangements

International Factor Movements and Multinational Enterprises

The Balance of Payments

Foreign Exchange

Exchange-Rate Determination

Mechanisms of International Adjustment

Exchange-Rate Adjustments and the Balance of Payments

Exchange-Rate Systems and Currency Crises

Macroeconomic Policy in an Open Economy

International Banking: Reserves, Debt, and Risk

Filters

Which method has $\underline { \text { not } }$ generally been used by the international commodity agreements to stabilize commodity prices?

Which of the following situations $\underline { \text { reduces } }$ the likelihood of successful operation of a cartel?

Which of the following is $\underline { \text { not } }$ a major factor that encourages developing nations to form international commodity agreements?

If the demand schedule for bauxite is relatively $\underline { \text { inelastic } }$ to price changes, an $\underline { \text { increase } }$ in the supply schedule of bauxite will cause a: