Question 1

Trade requires:

Accepted Answer

A)   governments to get together and agree on who is going to specialize in what.
B)   governments employ an economic planner to find comparative advantage for different products.
C)   that day-to-day business decision making is carried out almost entirely by firms and individuals, not by governments.
D)   firms and individuals to follow government mandates about what to trade.E) B) and D)
F) All of the above

Question 2

This graph demonstrates the domestic demand and supply for a good,as well as the world price for that good.  According to the graph shown,if this economy were open to free trade,domestic consumers would consume how many units?

Accepted Answer

A)   60
B)   115
C)   150
D)   90E) B) and D)
F) All of the above

Question 3

If a country has a comparative advantage in tea moved from autarky to free trade,this would cause what reaction in the world market?

Accepted Answer

A)   Domestic tea producers would be opposed.
B)   Foreign tea producers would be opposed.
C)   Foreign tea consumers would be opposed.
D)   Foreign producers would be in favor of.E) A) and B)
F) None of the above

Question 4

This graph demonstrates the domestic demand and supply for a good,as well as the world price for that good.  According to the graph shown,if this economy were open to free trade,how many units would be exported?

Accepted Answer

A)   35
B)   85
C)   120
D)   75E) None of the above
F) B) and D)

Question 5

This graph demonstrates the domestic demand and supply for a good,as well as the world price for that good.  According to the graph shown,if this economy were open to free trade,domestic consumers would consume how many units?

Accepted Answer

A)   45
B)   85
C)   120
D)   75E) B) and D)
F) All of the above

Question 6

This graph demonstrates the domestic demand and supply for a good,as well as the world price for that good.  According to the graph shown,if this economy were open to free trade,it would:

Accepted Answer

A)   import this good because the domestic price is greater than the world price.
B)   export this good because the domestic price is greater than the world price.
C)   import this good because the world price is greater than the domestic price.
D)   export this good because the world price is greater than the domestic price.E) A) and C)
F) None of the above

Question 7

This graph demonstrates the domestic demand and supply for a good,as well as a tariff and the world price for that good.  According to the graph shown,if this economy were open to free trade,and decided to impose a tariff,the domestic quantity supplied would increase from:

Accepted Answer

A)   815 to 1500.
B)   815 to 1150.
C)   250 to 500.
D)   250 to 815.E) A) and B)
F) C) and D)

Question 8

This graph demonstrates the domestic demand and supply for a good,as well as a tariff and the world price for that good.  According to the graph shown,if this economy were open to free trade,and decided to impose a tariff,the domestic quantity demanded would:

Accepted Answer

A)   decrease from 1500 to 1150.
B)   increase from 1150 to 1500.
C)   increase from 815 to 1150.
D)   decrease from 1150 to 815.E) All of the above
F) A) and B)

Question 9

National characteristics that affect the cost of producing goods in a particular country include all of the following except:

Accepted Answer

A)   natural resources and climate.
B)   endowment of factors of production.
C)   technology.
D)   proper government oversight of production.E) C) and D)
F) A) and B)

Question 10

This graph demonstrates the domestic demand and supply for a good,as well as the world price for that good.  According to the graph shown,if this were depicting an autarky,the amount being sold domestically is:

Accepted Answer

A)   60.
B)   115.
C)   160.
D)   90.E) A) and C)
F) A) and D)

Question 11

Import standards on specific countries usually address issues affecting:

Accepted Answer

A)   domestic consumers.
B)   domestic producers.
C)   foreign production practices.
D)   how goods and services flow from one nation to another.E) A) and B)
F) A) and C)

Question 12

Absolute advantage is the ability to produce:

Accepted Answer

A)   more of a good than others with a given amount of resources.
B)   relatively more than any other good with a given amount of resources.
C)   a good or service at a lower opportunity cost than others can.
D)   more of a good at a lower cost.E) None of the above
F) B) and D)

Question 13

We might predict that Japan has a comparative advantage compared to Russia in the production of hi-tech electronics because Japan has:

Accepted Answer

A)   a climate is more suitable for electronics.
B)   more land available to build manufacturing plants on.
C)   more advanced electronics technology.
D)   more unskilled labor available for production.E) C) and D)
F) A) and B)

Question 14

When a country has the ability to produce a good or service at a lower opportunity cost than others,they:

Accepted Answer

A)   have an absolute advantage.
B)   have a comparative advantage.
C)   are free-traders.
D)   should remain self-sufficient.E) A) and B)
F) C) and D)

Question 15

This graph demonstrates the domestic demand and supply for a good,as well as a quota and the world price for that good.  According to the graph shown,if the economy opens itself to free trade,producer surplus will:

Accepted Answer

A)   decrease to area I.
B)   decrease to area EI.
C)   increase to EI.
D)   increase to ABCDEFGH.E) All of the above
F) B) and C)

Question 16

This graph demonstrates the domestic demand and supply for a good,as well as a tariff and the world price for that good.  According to the graph shown,the change in consumer surplus brought about by the imposition of a tariff to an economy previously open to free trade is:

Accepted Answer

A)   an increase of HIJKL.
B)   a loss of HIJKL.
C)   a gain of DE.
D)   a loss of DE.E) None of the above
F) B) and C)

Question 17

This graph demonstrates the domestic demand and supply for a good,as well as the world price for that good.  According to the graph shown,if this economy were to open to trade,the amount consumed domestically would:

Accepted Answer

A)   increase by 35.
B)   increase by 90.
C)   decrease by 35.
D)   decrease by 90.E) B) and C)
F) None of the above

Question 18

This graph demonstrates the domestic demand and supply for a good,as well as the world price for that good.  According to the graph shown,if this economy were an autarky,producers would enjoy area:

Accepted Answer

A)   BCEFG
B)   BCDEFG
C)   G
D)   EFGE) A) and C)
F) A) and D)

Question 19

Suppose a country,whose production and consumption of cell phones is large relative to the world market,has just entered the global market.If the country is a net-importer of cell phones,we would expect the world:

Accepted Answer

A)   supply curve to shift more to the right than the world demand curve as a result.
B)   supply curve to shift more to the left than the world demand curve as a result.
C)   demand curve to shift more to the right than the world supply curve as a result.
D)   demand curve to shift more to the left than the world supply curve as a result.E) A) and D)
F) C) and D)

Question 20

This graph demonstrates the domestic demand and supply for a good,as well as a quota and the world price for that good.  According to the graph shown,when this economy is open to free trade without restriction,the amount imported is:

Accepted Answer

A)   900.
B)   1250.
C)   650.
D)   1000.E) B) and D)
F) A) and D)

Exam 17: International Trade

This graph demonstrates the domestic demand and supply for a good,as well as a quota and the world price for that good. According to the graph shown,when this economy is open to free trade without restriction,the amount imported is:

Correct AnswerverifiedShow Answer

We might predict that Japan has a comparative advantage compared to Russia in the production of hi-tech electronics because Japan has:

Correct AnswerverifiedShow Answer

This graph demonstrates the domestic demand and supply for a good,as well as the world price for that good. According to the graph shown,if this economy were open to free trade,domestic consumers would consume how many units?

Correct AnswerverifiedShow Answer

Suppose a country,whose production and consumption of cell phones is large relative to the world market,has just entered the global market.If the country is a net-importer of cell phones,we would expect the world:

Correct AnswerverifiedShow Answer

When a country has the ability to produce a good or service at a lower opportunity cost than others,they:

Correct AnswerverifiedShow Answer

Absolute advantage is the ability to produce:

Correct AnswerverifiedShow Answer

This graph demonstrates the domestic demand and supply for a good,as well as a tariff and the world price for that good. According to the graph shown,the change in consumer surplus brought about by the imposition of a tariff to an economy previously open to free trade is:

Correct AnswerverifiedShow Answer

This graph demonstrates the domestic demand and supply for a good,as well as a tariff and the world price for that good. According to the graph shown,if this economy were open to free trade,and decided to impose a tariff,the domestic quantity demanded would:

Correct AnswerverifiedShow Answer

This graph demonstrates the domestic demand and supply for a good,as well as the world price for that good. According to the graph shown,if this economy were to open to trade,the amount consumed domestically would:

Correct AnswerverifiedShow Answer

If a country has a comparative advantage in tea moved from autarky to free trade,this would cause what reaction in the world market?

Correct AnswerverifiedShow Answer

This graph demonstrates the domestic demand and supply for a good,as well as a tariff and the world price for that good. According to the graph shown,if this economy were open to free trade,and decided to impose a tariff,the domestic quantity supplied would increase from:

Correct AnswerverifiedShow Answer

Import standards on specific countries usually address issues affecting:

Correct AnswerverifiedShow Answer

National characteristics that affect the cost of producing goods in a particular country include all of the following except:

Correct AnswerverifiedShow Answer

This graph demonstrates the domestic demand and supply for a good,as well as the world price for that good. According to the graph shown,if this were depicting an autarky,the amount being sold domestically is:

Correct AnswerverifiedShow Answer

This graph demonstrates the domestic demand and supply for a good,as well as the world price for that good. According to the graph shown,if this economy were open to free trade,domestic consumers would consume how many units?

Correct AnswerverifiedShow Answer

This graph demonstrates the domestic demand and supply for a good,as well as the world price for that good. According to the graph shown,if this economy were an autarky,producers would enjoy area:

Correct AnswerverifiedShow Answer

This graph demonstrates the domestic demand and supply for a good,as well as a quota and the world price for that good. According to the graph shown,if the economy opens itself to free trade,producer surplus will:

Correct AnswerverifiedShow Answer

This graph demonstrates the domestic demand and supply for a good,as well as the world price for that good. According to the graph shown,if this economy were open to free trade,how many units would be exported?

Correct AnswerverifiedShow Answer

This graph demonstrates the domestic demand and supply for a good,as well as the world price for that good. According to the graph shown,if this economy were open to free trade,it would:

Correct AnswerverifiedShow Answer

Trade requires:

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified