Question 1

Theories of international economics from the 18th and 19th Centuries are

Accepted Answer

A) not relevant to current policy analysis. 
B) only of moderate relevance in today's modern international economy. 
C) highly relevant in today's modern international economy. 
D) the only theories that actually relevant to modern international economy. 
E) not well understood by modern mathematically oriented theorists. 
A) not relevant to current policy analysis. 
B) only of moderate relevance in today's modern international economy. 
C) highly relevant in today's modern international economy. 
D) the only theories that actually relevant to modern international economy. 
E) not well understood by modern mathematically oriented theorists. C

Question 2

In 1998 an economic and financial crisis in South Korea caused it to experience

Accepted Answer

A) a surplus in their balance of payments. 
B) a deficit in their balance of payments. 
C) a balanced balance of payments. 
D) an unbalanced balance of payments. 
E) a lull in international trade. 
A) a surplus in their balance of payments. 
B) a deficit in their balance of payments. 
C) a balanced balance of payments. 
D) an unbalanced balance of payments. 
E) a lull in international trade. A

Question 3

Trade theorists have proven that the gains from international trade

Accepted Answer

A) must raise the economic welfare of every country engaged in trade. 
B) must raise the economic welfare of everyone in every country engaged in trade. 
C) must harm owners of "specific" factors of production. 
D) will always help "winners" by an amount exceeding the losses of "losers." 
E) usually outweigh the benefits of protectionist policies. 
A) must raise the economic welfare of every country engaged in trade. 
B) must raise the economic welfare of everyone in every country engaged in trade. 
C) must harm owners of "specific" factors of production. 
D) will always help "winners" by an amount exceeding the losses of "losers." 
E) usually outweigh the benefits of protectionist policies. E

Question 4

In 1999,demonstrators representing a mix of traditional and new ideologies disrupted a major international trade meeting in Seattle of

Accepted Answer

A) the OECD. 
B) NAFTA. 
C) the WTO. 
D) GATT. 
E) the G8. 
A) the OECD. 
B) NAFTA. 
C) the WTO. 
D) GATT. 
E) the G8.

Question 5

The GATT is

Accepted Answer

A) an international treaty. 
B) an international U.N.agency. 
C) an international IMF agency. 
D) a U.S.government agency. 
E) a collection of tariffs. 
A) an international treaty. 
B) an international U.N.agency. 
C) an international IMF agency. 
D) a U.S.government agency. 
E) a collection of tariffs.

Question 6

During the first three years of its existence,the euro

Accepted Answer

A) depreciated against the $U.S. 
B) maintained a strict parity with the $U.S. 
C) strengthened against the $U.S. 
D) proved to be an impossible dream. 
E) exported exclusively to the U.S. 
A) depreciated against the $U.S. 
B) maintained a strict parity with the $U.S. 
C) strengthened against the $U.S. 
D) proved to be an impossible dream. 
E) exported exclusively to the U.S.

Question 7

The international debt crisis of early 1982 was precipitated when ________ could not pay its international debts.

Accepted Answer

A) Russia 
B) Mexico 
C) Brazil 
D) Malaysia 
E) China 
A) Russia 
B) Mexico 
C) Brazil 
D) Malaysia 
E) China

Question 8

Which of the following does NOT belong?

Accepted Answer

A) NAFTA 
B) Uruguay Round 
C) World Trade Organization 
D) non-tariff barriers 
E) major free trade agreements of the 1990s 
A) NAFTA 
B) Uruguay Round 
C) World Trade Organization 
D) non-tariff barriers 
E) major free trade agreements of the 1990s

Question 9

The benefits of international trade are derived from trade in

Accepted Answer

A) tangible goods only. 
B) intangible goods only. 
C) goods but not services. 
D) services but not goods. 
E) anything of value. 
A) tangible goods only. 
B) intangible goods only. 
C) goods but not services. 
D) services but not goods. 
E) anything of value.

Question 10

The balance of payments has become a central issue for the United States because

Accepted Answer

A) when the balance of payments is not balanced,society is unbalanced. 
B) the U.S.economy cannot grow when the balance of payments is in deficit. 
C) the U.S.has run huge trade deficits in every year since 1982. 
D) the U.S.never experienced a surplus in its balance of payments. 
E) the U.S.once ran a large trade surplus of about $40 billion. 
A) when the balance of payments is not balanced,society is unbalanced. 
B) the U.S.economy cannot grow when the balance of payments is in deficit. 
C) the U.S.has run huge trade deficits in every year since 1982. 
D) the U.S.never experienced a surplus in its balance of payments. 
E) the U.S.once ran a large trade surplus of about $40 billion.

Question 11

International Economists cannot discuss the effects of international trade or recommend changes in government policies toward trade with any confidence unless they know

Accepted Answer

A) their theory is the best available. 
B) their theory is internally consistent. 
C) their theory passes the "reasonable person" legal criteria. 
D) their theory is good enough to explain the international trade that is actually observed. 
E) their theory accounts for China's unique position in international trade. 
A) their theory is the best available. 
B) their theory is internally consistent. 
C) their theory passes the "reasonable person" legal criteria. 
D) their theory is good enough to explain the international trade that is actually observed. 
E) their theory accounts for China's unique position in international trade.

Question 12

It is argued that global trade tends to be more important to countries with smaller economies than the U.S.Is this empirically verified?

Accepted Answer

Yes.Figure 1-2 shows exports and imports

Question 13

An important insight of international trade theory is that when two countries engage in voluntary trade

Accepted Answer

A) one country always benefits at the expense of the other. 
B) it is almost always beneficial to both countries. 
C) it only benefits the low wage country. 
D) it only benefits the high wage country. 
E) it is almost never beneficial to both countries. 
A) one country always benefits at the expense of the other. 
B) it is almost always beneficial to both countries. 
C) it only benefits the low wage country. 
D) it only benefits the high wage country. 
E) it is almost never beneficial to both countries.

Question 14

The insight that patterns of trade are primarily determined by international differences in labor productivity was first proposed by

Accepted Answer

A) Adam Smith. 
B) David Hume. 
C) David Ricardo. 
D) Eli Heckscher. 
E) Lerner and Samuelson. 
A) Adam Smith. 
B) David Hume. 
C) David Ricardo. 
D) Eli Heckscher. 
E) Lerner and Samuelson.

Question 15

How are the patterns of international trade,that is the pattern of what different countries export and import,explained?

Accepted Answer

Climate explains why Brazil exports coff

Question 16

It is argued that if a rich high wage country such as the United States were to expand trade with a relatively poor and low wage country such as Mexico,then U.S.industry would migrate south,and U.S.wages would fall to the level of Mexico's.What do you think about this argument?

Accepted Answer

The student may think anything

Question 17

From 1960 to 2012

Accepted Answer

A) the U.S.economy roughly tripled in size. 
B) U.S.imports roughly tripled in size. 
C) the share of US Trade in the global economy roughly tripled in size. 
D) U.S.Imports roughly tripled as compared to U.S.exports. 
E) U.S.exports roughly tripled in size. 
A) the U.S.economy roughly tripled in size. 
B) U.S.imports roughly tripled in size. 
C) the share of US Trade in the global economy roughly tripled in size. 
D) U.S.Imports roughly tripled as compared to U.S.exports. 
E) U.S.exports roughly tripled in size.

Question 18

"Trade is generally harmful if there are large disparities between countries in wages."

Accepted Answer

A) This is generally true. 
B) This is generally false. 
C) Trade theory has nothing to say about this issue. 
D) This is true if the trade partner ignores child labor laws. 
E) This is true if the trade partner uses prison labor. 
A) This is generally true. 
B) This is generally false. 
C) Trade theory has nothing to say about this issue. 
D) This is true if the trade partner ignores child labor laws. 
E) This is true if the trade partner uses prison labor.

Question 19

The international capital market is

Accepted Answer

A) the place where you can rent earth moving equipment anywhere in the world. 
B) a set of arrangements by which individuals and firms exchange money now for promises to pay in the future. 
C) the arrangement where banks build up their capital by borrowing from the Central Bank. 
D) the place where emerging economies accept capital invested by banks. 
E) exclusively concerned with the debt crisis that ended in the 1990s. 
A) the place where you can rent earth moving equipment anywhere in the world. 
B) a set of arrangements by which individuals and firms exchange money now for promises to pay in the future. 
C) the arrangement where banks build up their capital by borrowing from the Central Bank. 
D) the place where emerging economies accept capital invested by banks. 
E) exclusively concerned with the debt crisis that ended in the 1990s.

Question 20

International monetary analysis focuses on

Accepted Answer

A) the real side of the international economy. 
B) the international trade side of the international economy. 
C) the international investment side of the international economy. 
D) the issues of international cooperation between Central Banks. 
E) the monetary side of the international economy,such as currency exchange. 
A) the real side of the international economy. 
B) the international trade side of the international economy. 
C) the international investment side of the international economy. 
D) the issues of international cooperation between Central Banks. 
E) the monetary side of the international economy,such as currency exchange.

Exam 1: Introduction

Theories of international economics from the 18th and 19th Centuries are

In 1998 an economic and financial crisis in South Korea caused it to experience

Trade theorists have proven that the gains from international trade

In 1999,demonstrators representing a mix of traditional and new ideologies disrupted a major international trade meeting in Seattle of

The GATT is

During the first three years of its existence,the euro

The international debt crisis of early 1982 was precipitated when ________ could not pay its international debts.

Which of the following does NOT belong?

The benefits of international trade are derived from trade in

The balance of payments has become a central issue for the United States because

International Economists cannot discuss the effects of international trade or recommend changes in government policies toward trade with any confidence unless they know

It is argued that global trade tends to be more important to countries with smaller economies than the U.S.Is this empirically verified?

An important insight of international trade theory is that when two countries engage in voluntary trade

The insight that patterns of trade are primarily determined by international differences in labor productivity was first proposed by

How are the patterns of international trade,that is the pattern of what different countries export and import,explained?

It is argued that if a rich high wage country such as the United States were to expand trade with a relatively poor and low wage country such as Mexico,then U.S.industry would migrate south,and U.S.wages would fall to the level of Mexico's.What do you think about this argument?

From 1960 to 2012

"Trade is generally harmful if there are large disparities between countries in wages."

The international capital market is

International monetary analysis focuses on

World Trade: An Overview

Labor Productivity and Comparative Advantage: The Ricardian Model

Specific Factors and Income Distribution

Resources and Trade: the Heckscher-Ohlin Model

The Standard Trade Model

External Economies of Scale and the International Location of Production

Firms in the Global Economy: Export Decisions, Outsourcing, and Multinational Enterprises

The Instruments of Trade Policy

The Political Economy of Trade Policy

Trade Policy in Developing Countries

Controversies in Trade Policy

National Income Accounting and the Balance of Payments

Exchange Rates and the Foreign Exchange Market: An Asset Approach

Money,Interest Rates, and Exchange Rates

Price Levels and the Exchange Rate in the Long Run

Output and the Exchange Rate in the Short Run

Fixed Exchange Rates and Foreign Exchange Intervention

International Monetary Systems: An Historical Overview

Financial Globalization: Opportunity and Crisis

Optimum Currency Areas and the Euro

Developing Countries: Growth, Crisis, and Reform

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