Exam 9: Application: International Trade

When a country allows international trade and becomes an importer of a good, domestic producers of the good are better off, and domestic consumers of the good are worse off.

Figure 9-15 -Refer to Figure 9-15. The amount of government revenue created by the tariff is

Figure 9-29 The following diagram shows the domestic demand and domestic supply curves in a market. Assume that the world price in this market is $1 per unit. -Refer to Figure 9-29. Suppose the country imposes a $1 per unit tariff. If the country allows trade with a tariff, how much is total surplus?

If a country allows free trade and its domestic price for a given good is lower than the world price, then it will import that good.

Figure 9-21 The following diagram shows the domestic demand and domestic supply for a market. In addition, assume that the world price in this market is $40 per unit. -Refer to Figure 9-21. With free trade, domestic production and domestic consumption, respectively, are

If the demand curve and the supply curve for a good are straight lines, then the deadweight loss that results from a tariff is represented on the supply-and-demand graph by

Figure 9-20 The figure illustrates the market for rice in Vietnam. -Refer to Figure 9-20. Given that Vietnam is a small country, it is apparent from the figure that

Both tariffs and import quotas

Suppose Brazil has a comparative advantage over other countries in producing almonds, but other countries have an absolute advantage over Brazil in producing almonds. If trade in almonds is allowed, Brazil

When the nation of Isoland opens up its steel market to international trade, that change

Figure 9-1 The figure illustrates the market for coffee in Guatemala. -Refer to Figure 9-1. When trade in coffee is allowed, producer surplus in Guatemala

When a country allows trade and becomes an importer of coal,

When a country allows international trade and becomes an exporter of a good,

The problem with the protection-as-a-bargaining-chip argument for trade restrictions is

Figure 9-2 The figure illustrates the market for calculators in a country. -Refer to Figure 9-2. Without trade, consumer surplus is

Figure 9-1 The figure illustrates the market for coffee in Guatemala. -Refer to Figure 9-1. Relative to the no-trade situation, trade with the rest of the world results in

A tariff is a

For any country, if the world price of copper is higher than the domestic price of copper without trade, that country should

In principle, trade can make a nation better off, because the gains to the winners exceed the losses to the losers.

By comparing the world price of pecans to India's domestic price of pecans, we can determine whether India