Question 1

The European Union is

Accepted Answer

A)  a common market. 
B)  a group of countries that impose tariffs on one another's agricultural goods. 
C)  an organization established to resolve trade disputes among member nations. 
D)  a restricted trade zone. 
A)  a common market. 
B)  a group of countries that impose tariffs on one another's agricultural goods. 
C)  an organization established to resolve trade disputes among member nations. 
D)  a restricted trade zone.

Question 2

If restrictions are placed on the textile industry, American textile workers will lose and American textile consumers will benefit.

Accepted Answer

A) True 
 B)False

Question 3

A country has an absolute advantage in producing a good if it can do so using fewer _____ than any other county can.

Accepted Answer

The answer of A country has an absolute advantage in...

Question 4

Goods and services produced domestically and sold abroad are called _____ .

Accepted Answer

The answer of Goods and services produced domestically and sold...

Question 5

A country has a comparative advantage in producing a good if it can do so at the lowest possible _____ _____.

Accepted Answer

The answer of A country has a comparative advantage in...

Question 6

Table 16.6
   Table 16.6 shows the combinations of quantities of two goods, gallons of ice cream and yards of textiles, that can be produced with all of the resources available in two countries, X and Y.
-Refer to Table 16.6. Which of the following statements is TRUE?

Accepted Answer

A)  These two countries can gain from trade. 
B)  Country X can gain from trade; Country Y will lose. 
C)  Country Y can gain from trade; Country X will lose. 
D)  Neither of these countries has a comparative advantage in ice cream. 
A)  These two countries can gain from trade. 
B)  Country X can gain from trade; Country Y will lose. 
C)  Country Y can gain from trade; Country X will lose. 
D)  Neither of these countries has a comparative advantage in ice cream.

Question 7

A country can only have an absolute advantage in producing a good if it also has a comparative advantage in producing that good.

Accepted Answer

A) True 
 B)False

Question 8

The effect of a tariff to increase supply of the good.

Accepted Answer

A) True 
 B)False

Question 9

When a country specializes in producing what it can offer at the lowest possible opportunity cost and then engages in trade, it will experience an _____ shift of its production possibilities curve.

Accepted Answer

The answer of When a country specializes in producing what...

Question 10

A _____ market is a free trade zone.

Accepted Answer

The answer of A _____ market is a free trade...

Question 11

On a supply and demand graph, the effect of an import quota is shown by making the supply curve vertical at the quantity allowed by the quota.

Accepted Answer

A) True 
 B)False

Question 12

Tariffs serve to

Accepted Answer

A)  encourage exports. 
B)  encourage imports. 
C)  encourage trade. 
D)  discourage trade. 
A)  encourage exports. 
B)  encourage imports. 
C)  encourage trade. 
D)  discourage trade.

Question 13

A quota is a restriction on the profit margin that a foreign producer may realize in a U.S. market.

Accepted Answer

A) True 
 B)False

Question 14

Which one of the following is TRUE?

Accepted Answer

A)  A nation pays for its imports through its exports. 
B)  Quotas on imported goods will affect the quantity sold but not the equilibrium price. 
C)  When tariffs are proposed, they typically are supported by consumers. 
D)  By purchasing imported goods, you destabilize the U.S. economy. 
A)  A nation pays for its imports through its exports. 
B)  Quotas on imported goods will affect the quantity sold but not the equilibrium price. 
C)  When tariffs are proposed, they typically are supported by consumers. 
D)  By purchasing imported goods, you destabilize the U.S. economy.

Question 15

Comparative advantage is related to the concept of opportunity cost.

Accepted Answer

A) True 
 B)False

Question 16

The effect of a _____ is to make the supply curve vertical at the restricted quantity.

Accepted Answer

The answer of The effect of a _____ is to...

Question 17

Table 16.1
     Table 16.1 shows the quantities of cookies and coffee that can be produced with the full amount of resources available in each of two countries, Alpha and Beta.
-Refer to Table 16.1. The table shows the production possibilities of cookies and coffee in Alpha and Beta measured in tons. In Alpha the domestic cost of 1 ton of cookies

Accepted Answer

A)  is 5 tons of coffee. 
B)  changes with the level of cookie production. 
C)  changes with the level of coffee production. 
D)  averages 4 tons of coffee. 
A)  is 5 tons of coffee. 
B)  changes with the level of cookie production. 
C)  changes with the level of coffee production. 
D)  averages 4 tons of coffee.

Question 18

When a good is sold in foreign markets below production cost, it is known as _____ .

Accepted Answer

The answer of When a good is sold in foreign...

Question 19

If there had been an effective _____ of French goods during the war in Iraq, it would have had the effect of eventually reducing employment in U.S. industries that manufacture goods for export.

Accepted Answer

The answer of If there had been an effective _____...

Question 20

The foreign sector of our economy has been steadily declining in size for the past 50 years.

Accepted Answer

A) True 
 B)False

The European Union is

If restrictions are placed on the textile industry, American textile workers will lose and American textile consumers will benefit.

A country has an absolute advantage in producing a good if it can do so using fewer _____ than any other county can.

Goods and services produced domestically and sold abroad are called _____ .

A country has a comparative advantage in producing a good if it can do so at the lowest possible _ _.

Table 16.6 Table 16.6 shows the combinations of quantities of two goods, gallons of ice cream and yards of textiles, that can be produced with all of the resources available in two countries, X and Y. -Refer to Table 16.6. Which of the following statements is TRUE?

A country can only have an absolute advantage in producing a good if it also has a comparative advantage in producing that good.

The effect of a tariff to increase supply of the good.

When a country specializes in producing what it can offer at the lowest possible opportunity cost and then engages in trade, it will experience an _____ shift of its production possibilities curve.

A _____ market is a free trade zone.

On a supply and demand graph, the effect of an import quota is shown by making the supply curve vertical at the quantity allowed by the quota.

Tariffs serve to

A quota is a restriction on the profit margin that a foreign producer may realize in a U.S. market.

Which one of the following is TRUE?

Comparative advantage is related to the concept of opportunity cost.

The effect of a _____ is to make the supply curve vertical at the restricted quantity.

When a good is sold in foreign markets below production cost, it is known as _____ .

If there had been an effective _____ of French goods during the war in Iraq, it would have had the effect of eventually reducing employment in U.S. industries that manufacture goods for export.

The foreign sector of our economy has been steadily declining in size for the past 50 years.

Economics and the World of Scarcity

The United States Within the World Economy

Demand and Supply

Consumer Decision Making and Consumer Reaction to Price Changes

The Firm: Production and Cost

The Two Extremes: Perfect Competition and Pure Monopoly

In Between the Extremes: Imperfect Competition

Market and Government Failures

Labor Economics

Unemployment, Inflation, and the Business Cycle

Aggregate Demand and Supply

The Fiscal Policy Approach to Stabilization

Money and Our Banking System

The Monetary Policy Approach to Stabilization

How Economies Grow

Financing World Trade

Filters

Exam 16: Trading With Other Nations

The European Union is

If restrictions are placed on the textile industry, American textile workers will lose and American textile consumers will benefit.

A country has an absolute advantage in producing a good if it can do so using fewer _____ than any other county can.

Goods and services produced domestically and sold abroad are called _____ .

A country has a comparative advantage in producing a good if it can do so at the lowest possible _____ _____.

Table 16.6 Table 16.6 shows the combinations of quantities of two goods, gallons of ice cream and yards of textiles, that can be produced with all of the resources available in two countries, X and Y. -Refer to Table 16.6. Which of the following statements is TRUE?

A country can only have an absolute advantage in producing a good if it also has a comparative advantage in producing that good.

The effect of a tariff to increase supply of the good.

When a country specializes in producing what it can offer at the lowest possible opportunity cost and then engages in trade, it will experience an _____ shift of its production possibilities curve.

A _____ market is a free trade zone.

On a supply and demand graph, the effect of an import quota is shown by making the supply curve vertical at the quantity allowed by the quota.

Tariffs serve to

A quota is a restriction on the profit margin that a foreign producer may realize in a U.S. market.

Which one of the following is TRUE?

Comparative advantage is related to the concept of opportunity cost.

The effect of a _____ is to make the supply curve vertical at the restricted quantity.

When a good is sold in foreign markets below production cost, it is known as _____ .

If there had been an effective _____ of French goods during the war in Iraq, it would have had the effect of eventually reducing employment in U.S. industries that manufacture goods for export.

The foreign sector of our economy has been steadily declining in size for the past 50 years.

Economics and the World of Scarcity

The United States Within the World Economy

Demand and Supply

Consumer Decision Making and Consumer Reaction to Price Changes

The Firm: Production and Cost

The Two Extremes: Perfect Competition and Pure Monopoly

In Between the Extremes: Imperfect Competition

Market and Government Failures

Labor Economics

Unemployment, Inflation, and the Business Cycle

Aggregate Demand and Supply

The Fiscal Policy Approach to Stabilization

Money and Our Banking System

The Monetary Policy Approach to Stabilization

How Economies Grow

Financing World Trade

Filters

A country has a comparative advantage in producing a good if it can do so at the lowest possible _ _.