Question 1

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

Accepted Answer

A) above its total costs. 
B) below its average total costs but above its average variable costs. 
C) below its average variable costs. 
D) above its average fixed costs but below its total variable costs. 
A) above its total costs. 
B) below its average total costs but above its average variable costs. 
C) below its average variable costs. 
D) above its average fixed costs but below its total variable costs.

Question 2

Which of the following is a TRUE statement?

Accepted Answer

A) Everyone benefits from free trade. 
B) Exporters benefit from trade and importers do not. 
C) Consumers benefit from trade and producers do not. 
D) Free trade harms domestic producers of goods that face import competition. 
A) Everyone benefits from free trade. 
B) Exporters benefit from trade and importers do not. 
C) Consumers benefit from trade and producers do not. 
D) Free trade harms domestic producers of goods that face import competition.

Question 3

If Kami can produce 40 tablets or 30 radios during a month's time,while Sally can produce 10 tablets or 20 radios,then it is correct to state that

Accepted Answer

A) Kami has a comparative advantage in producing tablets. 
B) Kami has a comparative advantage in producing both tablets and radios. 
C) Sally has a comparative advantage in producing both tablets and radios. 
D) Sally has an absolute advantage in tablets. 
A) Kami has a comparative advantage in producing tablets. 
B) Kami has a comparative advantage in producing both tablets and radios. 
C) Sally has a comparative advantage in producing both tablets and radios. 
D) Sally has an absolute advantage in tablets.

Question 4

People who focus on the "competitiveness" of the United States are

Accepted Answer

A) focusing on the right thing if the United States is to stay a leading economic power. 
B) treating the United States as if it is a business firm. 
C) also focusing on the importance of education. 
D) correctly recognizing that trade is a zero-sum game. 
A) focusing on the right thing if the United States is to stay a leading economic power. 
B) treating the United States as if it is a business firm. 
C) also focusing on the importance of education. 
D) correctly recognizing that trade is a zero-sum game.

Question 5

If in the long run,any government policy that increases exports

Accepted Answer

A) also increases imports. 
B) decreases imports. 
C) has no impact on imports. 
D) makes imports become negative. 
A) also increases imports. 
B) decreases imports. 
C) has no impact on imports. 
D) makes imports become negative.

Question 6

Assume that maximum feasible hourly productions levels if all resources are utilized in the United States are either 8 yards of fabric or 4 bushels of wheat.Maximum feasible production levels if all resources are utilized in Japan are either 3 yards of fabric or 6 bushels of wheat.Based on this information

Accepted Answer

A) beneficial trade is absolutely impossible between the two countries. 
B) the United States will benefit from trading but Japan will not. 
C) both nations will gain from specialization and trade,with the United States exporting wheat and Japan exporting fabric. 
D) both nations will gain from specialization and trade,with the United States exporting fabric and Japan exporting wheat. 
A) beneficial trade is absolutely impossible between the two countries. 
B) the United States will benefit from trading but Japan will not. 
C) both nations will gain from specialization and trade,with the United States exporting wheat and Japan exporting fabric. 
D) both nations will gain from specialization and trade,with the United States exporting fabric and Japan exporting wheat.

Question 7

Consider a world of two countries producing only wheat and cloth.In one hour,residents of Country A can produce 1 unit of wheat and 0.5 unit of cloth,whereas residents of Country B can produce 0.3 unit of wheat and 0.4 unit of cloth.Country A should export

Accepted Answer

A) wheat and cloth;country B should not export anything. 
B) wheat and country B should export cloth. 
C) nothing and country B should export both wheat and cloth. 
D) cloth and country B should export wheat. 
A) wheat and cloth;country B should not export anything. 
B) wheat and country B should export cloth. 
C) nothing and country B should export both wheat and cloth. 
D) cloth and country B should export wheat.

Question 8

A new industry develops,and our government wants to protect it from foreign competition.Which one of the following arguments would appropriately describe this type of protection?

Accepted Answer

A) National security 
B) Cartelization 
C) Infant industry 
D) Protecting American jobs 
A) National security 
B) Cartelization 
C) Infant industry 
D) Protecting American jobs

Question 9

The argument that trade in high-tech equipment can facilitate the implementation of advanced military technology in countries that may become strategic opponents later on is the

Accepted Answer

A) national security argument. 
B) infant industry argument. 
C) protecting domestic jobs argument. 
D) environmental and safety argument. 
A) national security argument. 
B) infant industry argument. 
C) protecting domestic jobs argument. 
D) environmental and safety argument.

Question 10

The successor to GATT in 1995 is

Accepted Answer

A) the World Agreement on Tariff and Trade. 
B) the World Trade Organization. 
C) the World Trade Agreement. 
D) the World Trade and Tariff Organization. 
A) the World Agreement on Tariff and Trade. 
B) the World Trade Organization. 
C) the World Trade Agreement. 
D) the World Trade and Tariff Organization.

Question 11

"The United States has fallen behind Japan and most of Europe in terms of competitiveness." Do you agree or disagree? Why?

Accepted Answer

Disagree.According to the Inst

Question 12

In the long run,if imports increase,then exports

Accepted Answer

A) will not change. 
B) will decrease. 
C) will also increase. 
D) will become zero. 
A) will not change. 
B) will decrease. 
C) will also increase. 
D) will become zero.

Question 13

The successor organization to GATT that handles trade disputes among its member nations is the

Accepted Answer

A) World Trade Organization. 
B) European Union. 
C) General Agreement on Tariffs and Trade. 
D) North American Free Trade Agreement. 
A) World Trade Organization. 
B) European Union. 
C) General Agreement on Tariffs and Trade. 
D) North American Free Trade Agreement.

Question 14

Which of the following is the situation in which a nation shifts its international trade from nations outside a regional trade bloc to nations within the bloc?

Accepted Answer

A) trade diversion 
B) trade deflection 
C) trade retention 
D) protectionism 
A) trade diversion 
B) trade deflection 
C) trade retention 
D) protectionism

Question 15

A legal restriction on the amount of a good that can be imported into a country is known as a

Accepted Answer

A) voluntary restraint agreement. 
B) tariff. 
C) quota. 
D) Domestic Protection Restraint (DPR). 
A) voluntary restraint agreement. 
B) tariff. 
C) quota. 
D) Domestic Protection Restraint (DPR).

Question 16

An official agreement with another country in which it agrees to import more from the United States is

Accepted Answer

A) a regional trade bloc. 
B) the quota system. 
C) a voluntary import expansion. 
D) a voluntary restraint agreement. 
A) a regional trade bloc. 
B) the quota system. 
C) a voluntary import expansion. 
D) a voluntary restraint agreement.

Question 17

-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?

Accepted Answer

A) Panel A 
B) Panel B 
C) Panel C 
D) Panel D 
A) Panel A 
B) Panel B 
C) Panel C 
D) Panel D

Question 18

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

Accepted Answer

There is very little relationship betwee

Question 19

The selling of a good or service abroad at a price below what is charged in the home market or below the cost of production is referred to as

Accepted Answer

A) recycling. 
B) a quota. 
C) dumping. 
D) a tariff. 
A) recycling. 
B) a quota. 
C) dumping. 
D) a tariff.

Question 20

Governments sometimes subsidize domestic industries.When this occurs,

Accepted Answer

A) the governments will not impose tariffs. 
B) the subsidized sell less in international markets because it is more profitable to sell at home. 
C) the subsidized industries have an advantage on international markets relative to non-subsidized firms.For this reason,other countries often impose tariffs on the subsidized imports. 
D) the subsidized industries have an advantage on international markets relative to nonsubsidized firms.However,this is not an argument for imposing tariffs and tariffs would violate international agreements. 
A) the governments will not impose tariffs. 
B) the subsidized sell less in international markets because it is more profitable to sell at home. 
C) the subsidized industries have an advantage on international markets relative to non-subsidized firms.For this reason,other countries often impose tariffs on the subsidized imports. 
D) the subsidized industries have an advantage on international markets relative to nonsubsidized firms.However,this is not an argument for imposing tariffs and tariffs would violate international agreements.

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

Which of the following is a TRUE statement?

If Kami can produce 40 tablets or 30 radios during a month's time,while Sally can produce 10 tablets or 20 radios,then it is correct to state that

People who focus on the "competitiveness" of the United States are

If in the long run,any government policy that increases exports

Consider a world of two countries producing only wheat and cloth.In one hour,residents of Country A can produce 1 unit of wheat and 0.5 unit of cloth,whereas residents of Country B can produce 0.3 unit of wheat and 0.4 unit of cloth.Country A should export

A new industry develops,and our government wants to protect it from foreign competition.Which one of the following arguments would appropriately describe this type of protection?

The argument that trade in high-tech equipment can facilitate the implementation of advanced military technology in countries that may become strategic opponents later on is the

The successor to GATT in 1995 is

"The United States has fallen behind Japan and most of Europe in terms of competitiveness." Do you agree or disagree? Why?

In the long run,if imports increase,then exports

The successor organization to GATT that handles trade disputes among its member nations is the

Which of the following is the situation in which a nation shifts its international trade from nations outside a regional trade bloc to nations within the bloc?

A legal restriction on the amount of a good that can be imported into a country is known as a

An official agreement with another country in which it agrees to import more from the United States is

-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?

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

The selling of a good or service abroad at a price below what is charged in the home market or below the cost of production is referred to as

Governments sometimes subsidize domestic industries.When this occurs,

The Nature of Economics

Scarcity and the World of Trade-Offs

Demand and Supply

Extensions of Demand and Supply Analysis

Public Spending and Public Choice

Funding the Public Sector

The Macroeconomy: Unemployment, inflation, and Deflation

Measuring the Economys Performance

Global Economic Growth and Development

Real GDP and the Price Level in the Long Run

Classical and Keynesian Macro Analyses

Consumption, real GDP, and the Multiplier

Fiscal Policy

Deficit Spending and the Public Debt

Money, banking, and Central Banking

Domestic and International Dimensions of Monetary Policy

Stabilization in an Integrated World Economy

Policies and Prospects for Global Economic Growth

Exchange Rates and the Balance of Payments

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Exam 32: Comparative Advantage and the Open Economy

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

Which of the following is a TRUE statement?

If Kami can produce 40 tablets or 30 radios during a month's time,while Sally can produce 10 tablets or 20 radios,then it is correct to state that

People who focus on the "competitiveness" of the United States are

If in the long run,any government policy that increases exports

Consider a world of two countries producing only wheat and cloth.In one hour,residents of Country A can produce 1 unit of wheat and 0.5 unit of cloth,whereas residents of Country B can produce 0.3 unit of wheat and 0.4 unit of cloth.Country A should export

A new industry develops,and our government wants to protect it from foreign competition.Which one of the following arguments would appropriately describe this type of protection?

The argument that trade in high-tech equipment can facilitate the implementation of advanced military technology in countries that may become strategic opponents later on is the

The successor to GATT in 1995 is

"The United States has fallen behind Japan and most of Europe in terms of competitiveness." Do you agree or disagree? Why?

In the long run,if imports increase,then exports

The successor organization to GATT that handles trade disputes among its member nations is the

Which of the following is the situation in which a nation shifts its international trade from nations outside a regional trade bloc to nations within the bloc?

A legal restriction on the amount of a good that can be imported into a country is known as a

An official agreement with another country in which it agrees to import more from the United States is

-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?

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

The selling of a good or service abroad at a price below what is charged in the home market or below the cost of production is referred to as

Governments sometimes subsidize domestic industries.When this occurs,

The Nature of Economics

Scarcity and the World of Trade-Offs

Demand and Supply

Extensions of Demand and Supply Analysis

Public Spending and Public Choice

Funding the Public Sector

The Macroeconomy: Unemployment, inflation, and Deflation

Measuring the Economys Performance

Global Economic Growth and Development

Real GDP and the Price Level in the Long Run

Classical and Keynesian Macro Analyses

Consumption, real GDP, and the Multiplier

Fiscal Policy

Deficit Spending and the Public Debt

Money, banking, and Central Banking

Domestic and International Dimensions of Monetary Policy

Stabilization in an Integrated World Economy

Policies and Prospects for Global Economic Growth

Exchange Rates and the Balance of Payments

Filters