Exam 18: Comparative Advantage and the Open Economy

-Refer to the above table. It may be concluded that

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

Since 1950, the volume of world trade and the volume of world real GDP

That each individual should engage in economic activities in which he or she is relatively more efficient is an application of the concept of

The selling of a good or service abroad at a price below production costs is

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

A tariff is a tax on

Governments sometimes subsidize domestic industries. When this occurs

-Use the above table. Assuming constant opportunity costs, the opportunity cost of producing donuts in country Alpha is ________, and the opportunity cost of producing donuts in country Beta is ________.

According to the principle of comparative advantage, a nation should specialize in economic activities

Dumping occurs when, in a foreign market, a good is sold

-Refer to the above table. If opportunity costs are constant, residents of the United States will gain from specializing and trading with Switzerland if the

Suppose a new EU member begins substituting its imports from non-EU members to other EU members. This is an example of

Free trade policies may lead to

All of the following are cited as factors in explaining U.S. competitiveness EXCEPT

Dumping typically occurs as long as the foreign producer sells its output at a price

Dumping typically occurs because

Mary can clean 20 windows per hour or type 30 pages of paper per hour. Tom can clean 18 windows per hour or he can type 25 pages of paper per hour. Based on this

-Refer to the above figures. A quota is placed on a foreign good. Which figure represents the situation in the domestic market for a competing domestic good?

Which of the following statements is FALSE?