Question 1

Specialization in trade will be economically efficient if it is based upon

Accepted Answer

A) national security needs. 
B) absolute advantage. 
C) comparative advantage. 
D) government regulations. 
A) national security needs. 
B) absolute advantage. 
C) comparative advantage. 
D) government regulations.

Question 2

The General Agreement on Tariffs and Trade is an international agreement

Accepted Answer

A) that outlaws all tariffs but permits quotas. 
B) to encourage world trade by lowering tariffs and other trade barriers. 
C) to encourage world trade by lending resources to developing countries. 
D) between the United States and Japan that has never been ratified,resulting in several trade wars with Japan. 
A) that outlaws all tariffs but permits quotas. 
B) to encourage world trade by lowering tariffs and other trade barriers. 
C) to encourage world trade by lending resources to developing countries. 
D) between the United States and Japan that has never been ratified,resulting in several trade wars with Japan.

Question 3

In international trade the term "dumping" means

Accepted Answer

A) price discrimination by domestic producers. 
B) selling goods in a foreign market for a price less than on the home market. 
C) selling goods in a home market for a price less than on the foreign market. 
D) selling goods on the black market to avoid paying taxes. 
A) price discrimination by domestic producers. 
B) selling goods in a foreign market for a price less than on the home market. 
C) selling goods in a home market for a price less than on the foreign market. 
D) selling goods on the black market to avoid paying taxes.

Question 4

The argument a tariff on imported goods produced by an unlimited industry could benefit the members of the domestic union is

Accepted Answer

A) the national defense argument. 
B) the protect domestic jobs argument. 
C) the infant industry argument. 
D) the dumping argument. 
A) the national defense argument. 
B) the protect domestic jobs argument. 
C) the infant industry argument. 
D) the dumping argument.

Question 5

Today,in the United States,exports are about

Accepted Answer

A) 90 percent of GDP. 
B) 12 percent of GDP. 
C) 28 percent of GDP. 
D) 4 percent of GDP. 
A) 90 percent of GDP. 
B) 12 percent of GDP. 
C) 28 percent of GDP. 
D) 4 percent of GDP.

Question 6

In 1990,there were 50 bilateral agreements and regional trade agreements between countries.Today there are

Accepted Answer

A) more than 230 of these agreements. 
B) 30 of these agreements. 
C) none of these agreements remaining. 
D) more than 10,000 of these agreements. 
A) more than 230 of these agreements. 
B) 30 of these agreements. 
C) none of these agreements remaining. 
D) more than 10,000 of these agreements.

Question 7

The contention that tariffs should be imposed to protect from import competition an industry that is trying to get started is

Accepted Answer

A) a basic argument for free trade. 
B) the infant industry argument. 
C) dumping. 
D) a voluntary restraint agreement. 
A) a basic argument for free trade. 
B) the infant industry argument. 
C) dumping. 
D) a voluntary restraint agreement.

Question 8

Benefits of free trade include all of the following EXCEPT

Accepted Answer

A) increased world production. 
B) higher standards of living. 
C) transmission of new ideas. 
D) increased international mobility of labor. 
A) increased world production. 
B) higher standards of living. 
C) transmission of new ideas. 
D) increased international mobility of labor.

Question 9

What is the relationship between imports and employment?

Accepted Answer

There is no causal link between imports

Question 10

If Bob can produce completed mathematics homework assignments at a lower opportunity cost than Jane can accomplish,then Bob has ________ in completing mathematics homework assignments.

Accepted Answer

A) a relative advantage 
B) an absolute advantage 
C) a complete advantage 
D) a comparative disadvantage 
A) a relative advantage 
B) an absolute advantage 
C) a complete advantage 
D) a comparative disadvantage

Question 11

Suppose an industry receives protection from the government in the form of tariffs.A number of years later,it is observed that the quantity supplied by domestic firms had decreased and that the domestic price was substantially greater than the world price.We could conclude that

Accepted Answer

A) the tariff had been imposed to counteract dumping and had been successful. 
B) removal of the tariff would actually cause domestic output to increase and price to fall. 
C) the tariff had been imposed to protect an infant industry and that the industry still needed protection. 
D) removal of the tariff would cause domestic output to fall even further and the price to fall to consumers. 
A) the tariff had been imposed to counteract dumping and had been successful. 
B) removal of the tariff would actually cause domestic output to increase and price to fall. 
C) the tariff had been imposed to protect an infant industry and that the industry still needed protection. 
D) removal of the tariff would cause domestic output to fall even further and the price to fall to consumers.

Question 12

A tax placed on imports is known as

Accepted Answer

A) voluntary restraint agreement. 
B) tariff. 
C) quota. 
D) infant industry. 
A) voluntary restraint agreement. 
B) tariff. 
C) quota. 
D) infant industry.

Question 13

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

Accepted Answer

A) below its cost of production or below the price in that market. 
B) at a discount below the list price. 
C) below its nominal price. 
D) at a price above the equilibrium price. 
A) below its cost of production or below the price in that market. 
B) at a discount below the list price. 
C) below its nominal price. 
D) at a price above the equilibrium price.

Question 14

-According to the above table,which assumes that opportunity costs of producing goods X and Y are constant,Chen has comparative advantage in production of

Accepted Answer

A) Good X. 
B) Good Y. 
C) both goods. 
D) neither good. 
A) Good X. 
B) Good Y. 
C) both goods. 
D) neither good.

Question 15

If a good sells for $10 domestically and the same good sells for $7 abroad,then this firm is engaging in

Accepted Answer

A) marginal cost selling. 
B) price discrimination. 
C) price differentiation. 
D) dumping. 
A) marginal cost selling. 
B) price discrimination. 
C) price differentiation. 
D) dumping.

Question 16

Comparative advantage is defined as

Accepted Answer

A) producing all goods at lower opportunity costs than other countries can. 
B) producing more output of all goods than anyone else can. 
C) producing one good at a lower opportunity cost than another country can. 
D) the ability to produce more output from given inputs than anyone else can. 
A) producing all goods at lower opportunity costs than other countries can. 
B) producing more output of all goods than anyone else can. 
C) producing one good at a lower opportunity cost than another country can. 
D) the ability to produce more output from given inputs than anyone else can.

Question 17

Which of the following is NOT an argument against free trade?

Accepted Answer

A) infant-industry argument 
B) protecting domestic job argument 
C) countering foreign subsidies argument 
D) comparative advantage argument 
A) infant-industry argument 
B) protecting domestic job argument 
C) countering foreign subsidies argument 
D) comparative advantage argument

Question 18

The ability to produce a good or service at a lower opportunity cost than other producers is called

Accepted Answer

A) absolute advantage. 
B) comparative advantage. 
C) implicit advantage. 
D) marginal advantage. 
A) absolute advantage. 
B) comparative advantage. 
C) implicit advantage. 
D) marginal advantage.

Question 19

The World Trade Organization is a successor organization to the

Accepted Answer

A) United Nations. 
B) World Bank. 
C) International Court of Justice. 
D) GATT. 
A) United Nations. 
B) World Bank. 
C) International Court of Justice. 
D) GATT.

Question 20

When a tariff is imposed,the supply curve for the imported good

Accepted Answer

A) shifts downward and to the right. 
B) shifts upward and to the left. 
C) does not change. 
D) becomes perfectly inelastic. 
A) shifts downward and to the right. 
B) shifts upward and to the left. 
C) does not change. 
D) becomes perfectly inelastic.

Specialization in trade will be economically efficient if it is based upon

The General Agreement on Tariffs and Trade is an international agreement

In international trade the term "dumping" means

The argument a tariff on imported goods produced by an unlimited industry could benefit the members of the domestic union is

Today,in the United States,exports are about

In 1990,there were 50 bilateral agreements and regional trade agreements between countries.Today there are

The contention that tariffs should be imposed to protect from import competition an industry that is trying to get started is

Benefits of free trade include all of the following EXCEPT

What is the relationship between imports and employment?

If Bob can produce completed mathematics homework assignments at a lower opportunity cost than Jane can accomplish,then Bob has ________ in completing mathematics homework assignments.

Suppose an industry receives protection from the government in the form of tariffs.A number of years later,it is observed that the quantity supplied by domestic firms had decreased and that the domestic price was substantially greater than the world price.We could conclude that

A tax placed on imports is known as

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

-According to the above table,which assumes that opportunity costs of producing goods X and Y are constant,Chen has comparative advantage in production of

If a good sells for $10 domestically and the same good sells for $7 abroad,then this firm is engaging in

Comparative advantage is defined as

Which of the following is NOT an argument against free trade?

The ability to produce a good or service at a lower opportunity cost than other producers is called

The World Trade Organization is a successor organization to the

When a tariff is imposed,the supply curve for the imported good

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

Exam 32: Comparative Advantage and the Open Economy

Specialization in trade will be economically efficient if it is based upon

The General Agreement on Tariffs and Trade is an international agreement

In international trade the term "dumping" means

The argument a tariff on imported goods produced by an unlimited industry could benefit the members of the domestic union is

Today,in the United States,exports are about

In 1990,there were 50 bilateral agreements and regional trade agreements between countries.Today there are

The contention that tariffs should be imposed to protect from import competition an industry that is trying to get started is

Benefits of free trade include all of the following EXCEPT

What is the relationship between imports and employment?

If Bob can produce completed mathematics homework assignments at a lower opportunity cost than Jane can accomplish,then Bob has ________ in completing mathematics homework assignments.

Suppose an industry receives protection from the government in the form of tariffs.A number of years later,it is observed that the quantity supplied by domestic firms had decreased and that the domestic price was substantially greater than the world price.We could conclude that

A tax placed on imports is known as

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

-According to the above table,which assumes that opportunity costs of producing goods X and Y are constant,Chen has comparative advantage in production of

If a good sells for $10 domestically and the same good sells for $7 abroad,then this firm is engaging in

Comparative advantage is defined as

Which of the following is NOT an argument against free trade?

The ability to produce a good or service at a lower opportunity cost than other producers is called

The World Trade Organization is a successor organization to the

When a tariff is imposed,the supply curve for the imported good

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