Question 1

The HPAE (High Performance Asian Economies) countries

Accepted Answer

A)  have all consistently supported free trade policies. 
B)  have all consistently maintained import-substitution policies. 
C)  have all consistently maintained non-biased efficient free capital markets. 
D)  have all maintained openness to international trade. 
E)  have all outperformed the U.S. 
A)  have all consistently supported free trade policies. 
B)  have all consistently maintained import-substitution policies. 
C)  have all consistently maintained non-biased efficient free capital markets. 
D)  have all maintained openness to international trade. 
E)  have all outperformed the U.S. D

Question 2

The development of countries like South Korea has been supported by all of the following except

Accepted Answer

A)  high domestic interest rates. 
B)  high domestic saving rates. 
C)  large endowments of human capital. 
D)  high levels of labor productivity. 
E)  reduced government regulation. 
A)  high domestic interest rates. 
B)  high domestic saving rates. 
C)  large endowments of human capital. 
D)  high levels of labor productivity. 
E)  reduced government regulation. A

Question 3

In 2003, the per-capita income in China was roughly ________ of that in the U.S.

Accepted Answer

A)  one hundredth 
B)  one eighth 
C)  one half 
D)  the same as 
E)  one twentieth 
A)  one hundredth 
B)  one eighth 
C)  one half 
D)  the same as 
E)  one twentieth B

Question 4

An efficient economy would set the marginal product in the traditional sector

Accepted Answer

A)  lower than that in the modern non-traditional sector. 
B)  higher than that in the modern sophisticated sector. 
C)  equal to that in the modern sophisticated sector. 
D)  lower in the relatively capital intensive sector. 
E)  higher in the relatively capital intensive sector. 
A)  lower than that in the modern non-traditional sector. 
B)  higher than that in the modern sophisticated sector. 
C)  equal to that in the modern sophisticated sector. 
D)  lower in the relatively capital intensive sector. 
E)  higher in the relatively capital intensive sector.

Question 5

Classical and Neoclassical trade theory makes the case that free trade can bring a country to an optimum and economically efficient use of its resources; and hence is an optimal trade-policy, if the objective is maximizing long term economic growth. There are those who argue that the experience of the Asian Miracle countries, such as Taiwan, South Korea and Singapore verify this argument in the real world. Explain. There are others who argue that the experience of these countries cannot be used to verify or support the argument above. Explain.

Accepted Answer

Both arguments may indeed be made. These

Question 6

Brazil's export record in 1999 illustrated the principle that

Accepted Answer

A)  a large country will tend to have few exports. 
B)  a small country will tend to have a high export ratio. 
C)  protectionist policies tend to discourage exports. 
D)  export-promoting policies do not tend to work. 
E)  import substitution policies helped the Brazilian economy. 
A)  a large country will tend to have few exports. 
B)  a small country will tend to have a high export ratio. 
C)  protectionist policies tend to discourage exports. 
D)  export-promoting policies do not tend to work. 
E)  import substitution policies helped the Brazilian economy.

Question 7

The experience of Chile's foreign sector in the last two decades of the 20th century supports the proposition that economic growth is supported by

Accepted Answer

A)  import substitution. 
B)  industrialization policies. 
C)  trade liberalization policies. 
D)  intra-industry trading. 
E)  trade embargoes. 
A)  import substitution. 
B)  industrialization policies. 
C)  trade liberalization policies. 
D)  intra-industry trading. 
E)  trade embargoes.

Question 8

The infant industry argument calls for active government involvement

Accepted Answer

A)  only if the government forecasts are accurate. 
B)  only if some market failure can be identified. 
C)  only if the industry is not one already dominated by industrial countries. 
D)  only if the industry has a high value added. 
E)  only if the industry is independently able to earn high returns. 
A)  only if the government forecasts are accurate. 
B)  only if some market failure can be identified. 
C)  only if the industry is not one already dominated by industrial countries. 
D)  only if the industry has a high value added. 
E)  only if the industry is independently able to earn high returns.

Question 9

The "East Asian Miracle" of the "Four Tigers" in the 1960s was replicated by

Accepted Answer

A)  developing countries around the world. 
B)  other East Asian countries. 
C)  Sub Sahara African countries. 
D)  Industrialized countries. 
E)  Eastern European countries. 
A)  developing countries around the world. 
B)  other East Asian countries. 
C)  Sub Sahara African countries. 
D)  Industrialized countries. 
E)  Eastern European countries.

Question 10

China's recent experience supports the proposition that

Accepted Answer

A)  "economic miracles" are solely to be expected in small countries. 
B)  central planning and socialism can promote sustained economic growth. 
C)  a lessening of income disparities is a prerequisite for economic growth. 
D)  growth in a large country cannot be affected by its foreign sector. 
E)  policy changed can dramatically prompt export oriented growth 
A)  "economic miracles" are solely to be expected in small countries. 
B)  central planning and socialism can promote sustained economic growth. 
C)  a lessening of income disparities is a prerequisite for economic growth. 
D)  growth in a large country cannot be affected by its foreign sector. 
E)  policy changed can dramatically prompt export oriented growth

Question 11

It is argued that import substitution is a misguided trade policy if the intent is to promote long-term economic growth. Explain the reasons underlying this argument.

Accepted Answer

Import substitution promotes that econom

Question 12

The "East Asian Miracle" is

Accepted Answer

A)  the ability of so many people to live in such small areas. 
B)  the fact that so many Influenza varieties originate from this region. 
C)  the fact that poor dualistic economies managed to escape the vicious circle of poverty. 
D)  the ability to maintain large positive trade balances with the U.S. 
E)  the advent of completely free labor mobility between east Asian countries. 
A)  the ability of so many people to live in such small areas. 
B)  the fact that so many Influenza varieties originate from this region. 
C)  the fact that poor dualistic economies managed to escape the vicious circle of poverty. 
D)  the ability to maintain large positive trade balances with the U.S. 
E)  the advent of completely free labor mobility between east Asian countries.

Question 13

Statistical evidence suggests that

Accepted Answer

A)  free trade policies promote economic growth more effectively than do import substitution policies. 
B)  import substituting policies tend to promote effective exploitation of scale economies. 
C)  import substitution tends to lead to relatively low effective rates of protection. 
D)  import substitution is to this day the preferred growth strategy promoted by the World Bank. 
E)  import substitution proved to be the most effective aid for developing countries before 1970. 
A)  free trade policies promote economic growth more effectively than do import substitution policies. 
B)  import substituting policies tend to promote effective exploitation of scale economies. 
C)  import substitution tends to lead to relatively low effective rates of protection. 
D)  import substitution is to this day the preferred growth strategy promoted by the World Bank. 
E)  import substitution proved to be the most effective aid for developing countries before 1970.

Question 14

The growth successes of the high performance Asian economies

Accepted Answer

A)  supports the belief that economic development requires import substitution policies. 
B)  rejects the belief that export-oriented industrialization is likely to promote economic development. 
C)  rejects the belief that economic development requires import substitution policies. 
D)  suggests that free trade policies are required for successful economic development. 
E)  enforces United States' hesitation to trade with developing countries. 
A)  supports the belief that economic development requires import substitution policies. 
B)  rejects the belief that export-oriented industrialization is likely to promote economic development. 
C)  rejects the belief that economic development requires import substitution policies. 
D)  suggests that free trade policies are required for successful economic development. 
E)  enforces United States' hesitation to trade with developing countries.

Question 15

Which trade strategy have developing countries used to restrict imports of manufactured goods so that the domestic market is preserved for home producers?

Accepted Answer

A)  international commodity agreement 
B)  export promotion 
C)  multilateral contract 
D)  import substitution 
E)  export subsidies 
A)  international commodity agreement 
B)  export promotion 
C)  multilateral contract 
D)  import substitution 
E)  export subsidies

Question 16

The United States, as it began its long and successful growth in the early 19th century, consciously promoted domestic production through such activities as tariffs, Clay's American System, and many direct subsidies to railroads, canal companies, farmers (free land) etc. Today we view this blatant example of large scale and extensive import-substitution industrialization as having been very successful. Comment on this.

Accepted Answer

This is an interesting point and emphasi

Question 17

A reason why it is difficult for developing countries to maintain a cartel is that

Accepted Answer

A)  the elasticity of demand for a cartel's output decreases over time. 
B)  producers in the cartel have an economic incentive to cheat. 
C)  economic profits discourage other producers from entering the industry. 
D)  producers in the cartel have the motivation to lower prices but not to raise prices. 
E)  tariffs allow producers in the cartel to produce items that make no profit. 
A)  the elasticity of demand for a cartel's output decreases over time. 
B)  producers in the cartel have an economic incentive to cheat. 
C)  economic profits discourage other producers from entering the industry. 
D)  producers in the cartel have the motivation to lower prices but not to raise prices. 
E)  tariffs allow producers in the cartel to produce items that make no profit.

Question 18

Export-led growth tends to

Accepted Answer

A)  discourage competition in the global economy. 
B)  exploit domestic comparative advantages. 
C)  lead to unemployment among domestic workers. 
D)  help firms benefit from diseconomies of large-scale production. 
E)  lower the overall volume of imports. 
A)  discourage competition in the global economy. 
B)  exploit domestic comparative advantages. 
C)  lead to unemployment among domestic workers. 
D)  help firms benefit from diseconomies of large-scale production. 
E)  lower the overall volume of imports.

Question 19

Taiwan and South Korea are examples of developing nations that have recently pursued these industrialization policies

Accepted Answer

A)  import substitution. 
B)  export promotion. 
C)  commercial dumping. 
D)  multilateral contract. 
E)  trade embargoes. 
A)  import substitution. 
B)  export promotion. 
C)  commercial dumping. 
D)  multilateral contract. 
E)  trade embargoes.

Question 20

Historically those few developing countries which have succeeded in significantly raising their per-capita income levels

Accepted Answer

A)  did not accomplish this with import-substituting industrialization. 
B)  did accomplish this with import-substituting industrialization. 
C)  tended to provide heavy protection to domestic industrial sectors. 
D)  favored industrial to agricultural or service sectors. 
E)  did so to the detriment of their nearest neighbors. 
A)  did not accomplish this with import-substituting industrialization. 
B)  did accomplish this with import-substituting industrialization. 
C)  tended to provide heavy protection to domestic industrial sectors. 
D)  favored industrial to agricultural or service sectors. 
E)  did so to the detriment of their nearest neighbors.

The HPAE (High Performance Asian Economies) countries

The development of countries like South Korea has been supported by all of the following except

In 2003, the per-capita income in China was roughly ________ of that in the U.S.

An efficient economy would set the marginal product in the traditional sector

Brazil's export record in 1999 illustrated the principle that

The experience of Chile's foreign sector in the last two decades of the 20th century supports the proposition that economic growth is supported by

The infant industry argument calls for active government involvement

The "East Asian Miracle" of the "Four Tigers" in the 1960s was replicated by

China's recent experience supports the proposition that

It is argued that import substitution is a misguided trade policy if the intent is to promote long-term economic growth. Explain the reasons underlying this argument.

The "East Asian Miracle" is

Statistical evidence suggests that

The growth successes of the high performance Asian economies

Which trade strategy have developing countries used to restrict imports of manufactured goods so that the domestic market is preserved for home producers?

A reason why it is difficult for developing countries to maintain a cartel is that

Export-led growth tends to

Taiwan and South Korea are examples of developing nations that have recently pursued these industrialization policies

Historically those few developing countries which have succeeded in significantly raising their per-capita income levels

Introduction

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

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

Optimum Currency Areas and the European Experience

Financial Globalization: Opportunity and Crisis

Developing Countries: Growth, Crisis, and Reform

Filters

Exam 11: Trade Policy in Developing Countries

The HPAE (High Performance Asian Economies) countries

The development of countries like South Korea has been supported by all of the following except

In 2003, the per-capita income in China was roughly ________ of that in the U.S.

An efficient economy would set the marginal product in the traditional sector

Brazil's export record in 1999 illustrated the principle that

The experience of Chile's foreign sector in the last two decades of the 20th century supports the proposition that economic growth is supported by

The infant industry argument calls for active government involvement

The "East Asian Miracle" of the "Four Tigers" in the 1960s was replicated by

China's recent experience supports the proposition that

It is argued that import substitution is a misguided trade policy if the intent is to promote long-term economic growth. Explain the reasons underlying this argument.

The "East Asian Miracle" is

Statistical evidence suggests that

The growth successes of the high performance Asian economies

Which trade strategy have developing countries used to restrict imports of manufactured goods so that the domestic market is preserved for home producers?

A reason why it is difficult for developing countries to maintain a cartel is that

Export-led growth tends to

Taiwan and South Korea are examples of developing nations that have recently pursued these industrialization policies

Historically those few developing countries which have succeeded in significantly raising their per-capita income levels

Introduction

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

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

Optimum Currency Areas and the European Experience

Financial Globalization: Opportunity and Crisis

Developing Countries: Growth, Crisis, and Reform

Filters