Question 1

A charge levied on imports in terms of a fixed percentage of value is known as a(n) :​

Accepted Answer

A)  specific tariff.
B)  ad valorem tariff.
C)  import quota.
D)  import concession.
E)  import substitution.F) C) and E)
G) A) and B)

Question 2

Which of the following reasons explains why many countries with relatively small populations import automobiles from Japan, U.S., and Germany rather than produce them domestically?​

Accepted Answer

A)  Differences in resource endowments
B)  Economies of scale
C)  Differences in tastes
D)  Import quota
E)  Import tariffsF) B) and E)
G) None of the above

Question 3

Quotas are favoured over free international trade by:​

Accepted Answer

A)  consumers in the importing country and consumers in the exporting country.
B)  domestic producers in the importing country and foreign producers with quota rights.
C)  domestic producers and domestic consumers in the exporting country.
D)  foreign producers without quota rights and consumers in the importing country.
E)  foreign consumers and domestic producers in the exporting country.F) A) and E)
G) All of the above

Question 4

For each fancy dress Cafilla produces, it gives up the opportunity to make 50 pounds of cheese. Bodoni can produce one fancy dress for every 100 pounds of cheese it produces. If specialization and trade were to occur between these two countries, which of the following would be consistent with the theory of comparative advantage?​

Accepted Answer

A)  Cafilla has the comparative advantage in dresses and cheese.
B)  Bodoni has the comparative advantage in dresses and cheese.
C)  Bodoni has the comparative advantage in only dresses.
D)  Cafilla has the comparative advantage in only dresses.
E)  Cafilla has the comparative advantage in only cheese.F) A) and C)
G) C) and D)

Question 5

Which of the following is true of predatory dumping?​

Accepted Answer

A)  It may be a way to encourage the development of domestic production of a good.
B)  It may drive out established firms.
C)  There are a great number of documented cases of predatory dumping.
D)  Once the competition is gone, the exporting firm lowers the price in the foreign market.
E)  Even after the dumpers have established their monopoly position in the foreign market, they prevent the entry of other firms into the market.F) A) and E)
G) A) and C)

Question 6

The following image shows the market for wheat for the country of Palatino. SD is the domestic supply of wheat, and DD is the domestic demand for wheat. Suppose the world price of wheat is $9 per bushel of wheat. Suppose a specific tariff of $6 is imposed on each bushel of wheat imported. Government revenue from the tariff equals: ​
Figure 19.4
​
D is the domestic supply of wheat, and DD is the domestic demand for wheat. Suppose the world price of wheat is $9 per bushel of wheat. Suppose a specific tariff of $6 is imposed on each bushel of wheat imported. Government revenue from the tariff equals: ​ Figure 19.4 ​   A) $45,000. B) $3,000,000. C) $1,800,000. D) $900,000. E) $50,000." class="answers-bank-image d-inline" rel="preload" >

Accepted Answer

A)  $45,000.
B)  $3,000,000.
C)  $1,800,000.
D)  $900,000.
E)  $50,000.F) B) and E)
G) D) and E)

Question 7

Which of the following is true of the terms of trade?​

Accepted Answer

A)  It is determined by supply and demand factors.
B)  It is a legal limit on the amount of a commodity that can be imported.
C)  It is determined by General Agreement on Tariffs and Trade.
D)  It is independent of the negotiations between trading partners.
E)  It is identical for all trading partners with differences in tastes.F) A) and B)
G) All of the above

Question 8

Which of the following is not a type of trade restriction?​

Accepted Answer

A)  Low-interest loans to foreign buyers​
B)  Export subsidies to domestic producers
C)  Restrictive health and safety standards
D)  Domestic content requirements
E)  Economies of scaleF) A) and C)
G) All of the above

Question 9

The following graph shows the demand for and the supply of a good in a country. If the world price of the good is $2.00 per unit and an import quota of 50 units per month is imposed, then the decrease in consumer surplus can be represented by the area _____. ​
Figure 19.6
​

Accepted Answer

A)  f
B)  i
C)  h
D)  f, g, and h
E)  a, b, c, d, and eF) B) and E)
G) B) and C)

Question 10

The following table shows per-day production data of rice and T-shirts for two countries, Cambria and Bodoni. Based on the table, it can be said that trade between Bodoni and Cambria will benefit Cambria but not Bodoni.
​
Table 19.1
​

Accepted Answer

A) True 
 B)False

Question 11

Which of the following is true of international trade?​

Accepted Answer

A)  It allows a country to specialize in the production of certain goods and services.
B)  It leads to a reduction in the world production of goods and services.
C)  It allows a country to move to a lower consumption possibilities frontier.
D)  It allows a country's consumption possibilities frontier to lie inside its production possibilities frontier.
E)  It makes a country's production possibilities frontier a downward-sloping straight line.F) B) and E)
G) B) and C)

Question 12

Which of the following is true of a country's production possibilities frontier?​

Accepted Answer

A)  International trade makes it possible for a country's consumption possibilities to exceed its production possibilities.
B)  International trade requires that a country's production possibilities exceed its consumption possibilities.
C)  A country's production possibilities always equal its consumption possibilities.
D)  A country's consumption possibilities can never equal its production possibilities because of leakages in the system.
E)  The slope of a country's production possibilities frontier is equal to the absolute advantage of producing a particular good.F) B) and E)
G) A) and D)

Question 13

The following graph shows the supply of and demand for baseballs in the United States. If the world price is $3 per baseball and a tariff of $1 per baseball is imposed, then the tariff revenue collected by the United States government is shown by the area _____. ​
Figure 19.3
​

Accepted Answer

A)  a
B)  b
C)  c
D)  f
E)  eF) A) and C)
G) A) and D)

Question 14

A lump-sum tax per unit on imports is known as:​

Accepted Answer

A)  a specific tariff.
B)  an import quota.
C)  an ad valorem tariff.
D)  an import concession.
E)  an import substitution.F) A) and B)
G) B) and D)

Question 15

The following graph shows the demand for and the supply of a good in a country. If the world price of the good is $2.00 per unit and an import quota of 50 units per month is imposed, then: ​
Figure 19.6
​

Accepted Answer

A)  domestic production will increase from 100 to 200 units per month.
B)  imports will increase from 25 to 50 units per month.
C)  domestic production will increase from 100 to 175 units per month.
D)  domestic production will increase from 100 to 125 units per month.
E)  domestic production will increase from 100 to 150 units per month.F) B) and E)
G) B) and C)

Question 16

The basis of the benefits of specialization is:​

Accepted Answer

A)  comparative advantage.
B)  absolute advantage.
C)  the size of the country.
D)  identical production costs between two countries.
E)  agreeable terms of trade.F) A) and C)
G) All of the above

Question 17

Which of the following is true of an export subsidy?​

Accepted Answer

A)  It increases the net welfare in an economy and accelerates economic progress.
B)  It slows economic progress and reduces the net welfare in an economy.
C)  It gives rise to unsustainable government deficits.
D)  It promotes free international trade.
E)  It specifies that a certain portion of a final good must be produced domestically.F) None of the above
G) B) and C)

Question 18

Autarky is:​

Accepted Answer

A)  the situation of national self-sufficiency, in which there is no economic interaction with foreign producers or consumers.
B)  the situation in which there is no legal limit on the amount of a commodity that can be imported.
C)  the situation in which countries export products they can produce more cheaply in return for products that are unavailable domestically or are cheaper elsewhere.
D)  the situation in which world price is determined by the world supply and demand for a product.
E)  the situation in which each country specializes in making goods with the lowest opportunity cost.F) All of the above
G) C) and D)

Question 19

The following table shows per-day production data of rice and T-shirts for two countries, Cambria and Bodoni. Based on the table, it can be said that Bodoni should produce rice and trade their rice for Cambria's T-shirts.
​
Table 19.1
​

Accepted Answer

A) True 
 B)False

Question 20

Quotas and tariffs discourage foreign governments from retaliating with quotas and tariffs of their own.

Accepted Answer

A) True 
 B)False

Exam 19: International Trade

The following table shows per-day production data of rice and T-shirts for two countries, Cambria and Bodoni. Based on the table, it can be said that trade between Bodoni and Cambria will benefit Cambria but not Bodoni. Table 19.1

Correct Answer
verified

Which of the following is true of international trade?

Correct Answer
verified

The following graph shows the demand for and the supply of a good in a country. If the world price of the good is $2.00 per unit and an import quota of 50 units per month is imposed, then the decrease in consumer surplus can be represented by the area _____. Figure 19.6

Correct Answer
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Which of the following is true of the terms of trade?

Correct Answer
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Autarky is:

Correct Answer
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Correct Answer
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The following table shows per-day production data of rice and T-shirts for two countries, Cambria and Bodoni. Based on the table, it can be said that Bodoni should produce rice and trade their rice for Cambria's T-shirts. Table 19.1

Correct Answer
verified

Which of the following is not a type of trade restriction?

Correct Answer
verified

Which of the following is true of a country's production possibilities frontier?

Correct Answer
verified

A charge levied on imports in terms of a fixed percentage of value is known as a(n) :

Correct Answer
verified

A lump-sum tax per unit on imports is known as:

Correct Answer
verified

The basis of the benefits of specialization is:

Correct Answer
verified

Which of the following is true of an export subsidy?

Correct Answer
verified

The following graph shows the demand for and the supply of a good in a country. If the world price of the good is $2.00 per unit and an import quota of 50 units per month is imposed, then: Figure 19.6

Correct Answer
verified

The following graph shows the supply of and demand for baseballs in the United States. If the world price is $3 per baseball and a tariff of $1 per baseball is imposed, then the tariff revenue collected by the United States government is shown by the area _____. Figure 19.3

Correct Answer
verified

Which of the following is true of predatory dumping?

Correct Answer
verified

Quotas and tariffs discourage foreign governments from retaliating with quotas and tariffs of their own.

Correct Answer
verified

Correct Answer
verified

Which of the following reasons explains why many countries with relatively small populations import automobiles from Japan, U.S., and Germany rather than produce them domestically?

Correct Answer
verified

Quotas are favoured over free international trade by:

Correct Answer
verified

Exam 19: International Trade

The following table shows per-day production data of rice and T-shirts for two countries, Cambria and Bodoni. Based on the table, it can be said that trade between Bodoni and Cambria will benefit Cambria but not Bodoni. ​ Table 19.1 ​

Correct AnswerverifiedShow Answer

Which of the following is true of international trade?​

Correct AnswerverifiedShow Answer

The following graph shows the demand for and the supply of a good in a country. If the world price of the good is $2.00 per unit and an import quota of 50 units per month is imposed, then the decrease in consumer surplus can be represented by the area _____. ​ Figure 19.6 ​

Correct AnswerverifiedShow Answer

Which of the following is true of the terms of trade?​

Correct AnswerverifiedShow Answer

Autarky is:​

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The following table shows per-day production data of rice and T-shirts for two countries, Cambria and Bodoni. Based on the table, it can be said that Bodoni should produce rice and trade their rice for Cambria's T-shirts. ​ Table 19.1 ​

Correct AnswerverifiedShow Answer

Which of the following is not a type of trade restriction?​

Correct AnswerverifiedShow Answer

Which of the following is true of a country's production possibilities frontier?​

Correct AnswerverifiedShow Answer

A charge levied on imports in terms of a fixed percentage of value is known as a(n) :​

Correct AnswerverifiedShow Answer

A lump-sum tax per unit on imports is known as:​

Correct AnswerverifiedShow Answer

The basis of the benefits of specialization is:​

Correct AnswerverifiedShow Answer

Which of the following is true of an export subsidy?​

Correct AnswerverifiedShow Answer

The following graph shows the demand for and the supply of a good in a country. If the world price of the good is $2.00 per unit and an import quota of 50 units per month is imposed, then: ​ Figure 19.6 ​

Correct AnswerverifiedShow Answer

The following graph shows the supply of and demand for baseballs in the United States. If the world price is $3 per baseball and a tariff of $1 per baseball is imposed, then the tariff revenue collected by the United States government is shown by the area _____. ​ Figure 19.3 ​

Correct AnswerverifiedShow Answer

Which of the following is true of predatory dumping?​

Correct AnswerverifiedShow Answer

Quotas and tariffs discourage foreign governments from retaliating with quotas and tariffs of their own.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following reasons explains why many countries with relatively small populations import automobiles from Japan, U.S., and Germany rather than produce them domestically?​

Correct AnswerverifiedShow Answer

Quotas are favoured over free international trade by:​

Correct AnswerverifiedShow Answer

The following table shows per-day production data of rice and T-shirts for two countries, Cambria and Bodoni. Based on the table, it can be said that trade between Bodoni and Cambria will benefit Cambria but not Bodoni. Table 19.1

Correct Answer
verified

Which of the following is true of international trade?

Correct Answer
verified

The following graph shows the demand for and the supply of a good in a country. If the world price of the good is $2.00 per unit and an import quota of 50 units per month is imposed, then the decrease in consumer surplus can be represented by the area _____. Figure 19.6

Correct Answer
verified

Which of the following is true of the terms of trade?

Correct Answer
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Autarky is:

Correct Answer
verified

Correct Answer
verified

The following table shows per-day production data of rice and T-shirts for two countries, Cambria and Bodoni. Based on the table, it can be said that Bodoni should produce rice and trade their rice for Cambria's T-shirts. Table 19.1

Correct Answer
verified

Which of the following is not a type of trade restriction?

Correct Answer
verified

Which of the following is true of a country's production possibilities frontier?

Correct Answer
verified

A charge levied on imports in terms of a fixed percentage of value is known as a(n) :

Correct Answer
verified

A lump-sum tax per unit on imports is known as:

Correct Answer
verified

The basis of the benefits of specialization is:

Correct Answer
verified

Which of the following is true of an export subsidy?

Correct Answer
verified

The following graph shows the demand for and the supply of a good in a country. If the world price of the good is $2.00 per unit and an import quota of 50 units per month is imposed, then: Figure 19.6

Correct Answer
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The following graph shows the supply of and demand for baseballs in the United States. If the world price is $3 per baseball and a tariff of $1 per baseball is imposed, then the tariff revenue collected by the United States government is shown by the area _____. Figure 19.3

Correct Answer
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Which of the following is true of predatory dumping?

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Which of the following reasons explains why many countries with relatively small populations import automobiles from Japan, U.S., and Germany rather than produce them domestically?

Correct Answer
verified

Quotas are favoured over free international trade by:

Correct Answer
verified