Exam 8: International Trade

Use the following to answer questions : -(Figure: The Market for Laptops)Use Figure: The Market for Laptops.Assume that S and D are the domestic supply and demand curves,respectively,and the world price is P_W.Identify the area of deadweight loss when a tariff raises the domestic price from the world price to P_T.

If Canada imposes a tariff of $5 per bottle on French wine,the MOST likely effect will be to raise the price of wine in Canada by:

Use the following to answer questions : Table: Production Possibilities for Machinery and Petroleum Country Machinery (M) (units) Petroleum (P) (units) Canada 80 40 Mexico 60 180 -(Table: The Production Possibilities for Tractors and Crude Oil)Use Table: The Production Possibilities for Tractors and Crude Oil.Canada has a comparative advantage in _____,and Mexico has a comparative advantage in _____.

A tax on imports of foreign goods is called a(n):

Both Canada and the United States produce automobiles and their components;however,each particular model or component is produced in only one of the two countries.Which factor explains this pattern of production and trade?

In a single year,the Netherlands can raise 100 tonnes of beef or produce 1 000 boxes of tulips.In the same growing season,Belgium can raise 50 tonnes of beef or produce 750 boxes of tulips.In autarky,the opportunity cost of 1 tonne of beef in the Netherlands is:

If a market begins to engage in international trade,we can assume that:

Use the following to answer questions : -(Figure: The Market for Computers)Use Figure: The Market for Computers.Assume that P_A is the autarky price and P_W is the world price.Consumer surplus with international trade is area:

In practice,much trade protection reflects the political influence of import-competing producers.

Use the following to answer questions : -(Figure: The Market for Calculators)Use Figure: The Market for Calculators.Assume that S and D represent the domestic demand and supply of calculators,respectively.The world price,P_W,equals $100.The government imposes a quota restricting imports to 25 calculators.The domestic price rises to _____,and the quota rent is equal to area _____.

Restrictions on free international trade designed to insulate domestic industries from competitive market forces that originate beyond the borders of the country are _____ policies.

Use the following to answer questions : -(Figure: The Production Possibilities for Two Countries)Use Figure: The Production Possibilities for Two Countries.If Indonesia and Malaysia trade 1 microchip for 1 tire,the most that Indonesia can consume is _____ microchips and _____ tires,while the most that Malaysia can consume is _____ microchips and _____ tires.

The term autarky refers to a situation when a country:

Use the following to answer questions : $\text {Scenario: The Production of Wheat and Toys}$ Wheat Toys Country A 50 100 Country B 25 75 $\text {The table describes the production of two goods, wheat and toys, in country A and country B.}$ $\text { Each country has a linear production possibility frontier with respect to its production of the two}$ $\text {goods. The numbers in each column represent the total number of units each country could}$ $\text { produce if it used all of its resources to produce the good.}$ -(Scenario: The Production of Wheat and Toys)Use Scenario: Production of Wheat and Toys.The opportunity cost of producing a unit of wheat in country B is:

If Canada can produce 30 computers for every car it produces and Japan can produce 15 computers for every car it produces,_____ has the _____ advantage in car production.

Which statement is NOT true about the World Trade Organization (WTO)?

Use the following to answer questions : -(Figure: The Production Possibilities for Two Countries)Use Figure: The Production Possibilities for Two Countries.Both nations will gain from trade when 1 tire trades for _____ microchip(s).

Gains from trade will result if a country specializes in:

Use the following to answer questions : Table: Production Possibilities for Machinery and Petroleum Country Machinery (M) (units) Petroleum (P) (units) Canada 80 40 Mexico 60 180 -(Table: Production Possibilities for Machinery and Petroleum)Use Table: Production Possibilities for Machinery and Petroleum.The opportunity cost in Mexico of producing 105 units of petroleum is _____ units of machinery.

In autarky,the amount of a country's production and consumption of a good must be identical.