Question 1

Which of the following statements is FALSE?

Accepted Answer

A)   No one benefits from trade-restricting policies.
B)   A tariff is an example of a trade-restricting policy.
C)   Dumping or increasing a tariff by a country could result in a trade war with another country.
D)   International specialization can become more extensive as the markets in which trade occurs become larger.E) A) and B)
F) A) and C)

Question 2

Restricting trade on the assumption that consumer demand is not strong enough to sustain both domestic and foreign producers would be justified using the:

Accepted Answer

A)   diversification argument.
B)   infant industry argument.
C)   national security argument.
D)   domestic employment and output argument.E) All of the above
F) C) and D)

Question 3

Use the following table showing production possibilities for tea and coffee from one unit of resources in Country K and one unit of resources in Country L.
 
-The opportunity cost to Country L of producing one pound of coffee is:

Accepted Answer

A)   zero.
B)   1 pound of tea.
C)   2 pounds of tea.
D)   1/2 pound of tea.E) All of the above
F) A) and B)

Question 4

NAFTA was established to remove trade barriers among North America, Africa, France, Turkey, and Australia.

Accepted Answer

A) True 
 B)False

Question 5

What is dumping, and how might it cause a trade war between nations?

Accepted Answer

Dumping is the practice of selling goods...

Question 6

A good produced in Country A and sold to a buyer in Country B is:

Accepted Answer

A)   an import for Country A and an export for Country B.
B)   an export for Country A and an import for Country B.
C)   an outside good for Country A and a secondary good for Country B.
D)   a trade reducing good for Country A and an unaccounted good for Country B.E) C) and D)
F) All of the above

Question 7

According to the principle of comparative advantage, the main reason two countries should each produce a single good and trade with the other country for the good they do not produce is:

Accepted Answer

A)   differences in access to capital.
B)   different technological endowments.
C)   greater efficiency due to specialization.
D)   differences in the skills of their labor forces.E) B) and C)
F) All of the above

Question 8

Country A currently produces ten CD players with one unit of resources and five televisions with another unit of resources. Country B currently produces eight CD players with one unit of resources and eight televisions with another unit of resources.
-The opportunity cost of producing CD players is:

Accepted Answer

A)   lower in Country A than in Country B.
B)   higher in Country A than in Country B.
C)   the same in Country A as in Country B.
D)   zero in both countries since each currently produces both CD players and televisions.E) A) and B)
F) B) and D)

Question 9

How have U.S. exports and imports behaved as a percentage of GDP since 1970, and with whom does the U.S. do most of its international trading?

Accepted Answer

The US does most of its intern...

Question 10

Which of the following is not an argument for protectionism?

Accepted Answer

A)   National defense considerations.
B)   Protecting domestic jobs.
C)   Expanding economic efficiency and specialization.
D)   Sheltering infant industries.E) B) and C)
F) A) and D)

Question 11

You would expect a nation's mood to become more protectionist during:

Accepted Answer

A)   an economic expansion.
B)   a recession, or economic downswing.
C)   an extended period of political stability.
D)   a period when the supply of labor is very tight.E) B) and C)
F) C) and D)

Question 12

According to the principle of comparative advantage, trade between two countries will benefit:

Accepted Answer

A)   both countries.
B)   neither country.
C)   the country with lower production costs.
D)   the country with higher production costs.E) B) and D)
F) B) and C)

Question 13

Since World War II tariff reductions have occurred largely because of negotiations under the:

Accepted Answer

A)   Monetary Control Act.
B)   Employment Act of 1946.
C)   Industry and Trade Administration.
D)   General Agreement on Tariffs and Trade.E) All of the above
F) B) and C)

Question 14

Use the basis of the following table showing production possibilities for pizzas and birthday cakes from one unit of resources in Country C and Country D.
 
-On the basis of the information in the table, if these countries produce according to their comparative advantages, Country C should:

Accepted Answer

A)   produce pizzas.
B)   produce birthday cakes.
C)   not produce pizzas or birthday cakes.
D)   produce both pizzas and birthday cakes.E) B) and C)
F) A) and C)

Exam 16: International Trade

What is dumping, and how might it cause a trade war between nations?

Correct Answer
verified
Dumping is the practice of selling goods...
View Answer

Since World War II tariff reductions have occurred largely because of negotiations under the:

Correct Answer
verified

According to the principle of comparative advantage, the main reason two countries should each produce a single good and trade with the other country for the good they do not produce is:

Correct Answer
verified

Use the basis of the following table showing production possibilities for pizzas and birthday cakes from one unit of resources in Country C and Country D. -On the basis of the information in the table, if these countries produce according to their comparative advantages, Country C should:

Correct Answer
verified

Use the following table showing production possibilities for tea and coffee from one unit of resources in Country K and one unit of resources in Country L. -The opportunity cost to Country L of producing one pound of coffee is:

Correct Answer
verified

Which of the following is not an argument for protectionism?

Correct Answer
verified

A good produced in Country A and sold to a buyer in Country B is:

Correct Answer
verified

You would expect a nation's mood to become more protectionist during:

Correct Answer
verified

NAFTA was established to remove trade barriers among North America, Africa, France, Turkey, and Australia.

Correct Answer
verified

Which of the following statements is FALSE?

Correct Answer
verified

Restricting trade on the assumption that consumer demand is not strong enough to sustain both domestic and foreign producers would be justified using the:

Correct Answer
verified

How have U.S. exports and imports behaved as a percentage of GDP since 1970, and with whom does the U.S. do most of its international trading?

Correct Answer
verified
The US does most of its intern...
View Answer

Country A currently produces ten CD players with one unit of resources and five televisions with another unit of resources. Country B currently produces eight CD players with one unit of resources and eight televisions with another unit of resources. -The opportunity cost of producing CD players is:

Correct Answer
verified

According to the principle of comparative advantage, trade between two countries will benefit:

Correct Answer
verified

Exam 16: International Trade

What is dumping, and how might it cause a trade war between nations?

Correct AnswerverifiedDumping is the practice of selling goods...View AnswerShow Answer

Since World War II tariff reductions have occurred largely because of negotiations under the:

Correct AnswerverifiedShow Answer

According to the principle of comparative advantage, the main reason two countries should each produce a single good and trade with the other country for the good they do not produce is:

Correct AnswerverifiedShow Answer

Use the basis of the following table showing production possibilities for pizzas and birthday cakes from one unit of resources in Country C and Country D. -On the basis of the information in the table, if these countries produce according to their comparative advantages, Country C should:

Correct AnswerverifiedShow Answer

Use the following table showing production possibilities for tea and coffee from one unit of resources in Country K and one unit of resources in Country L. -The opportunity cost to Country L of producing one pound of coffee is:

Correct AnswerverifiedShow Answer

Which of the following is not an argument for protectionism?

Correct AnswerverifiedShow Answer

A good produced in Country A and sold to a buyer in Country B is:

Correct AnswerverifiedShow Answer

You would expect a nation's mood to become more protectionist during:

Correct AnswerverifiedShow Answer

NAFTA was established to remove trade barriers among North America, Africa, France, Turkey, and Australia.

Correct AnswerverifiedShow Answer

Which of the following statements is FALSE?

Correct AnswerverifiedShow Answer

Restricting trade on the assumption that consumer demand is not strong enough to sustain both domestic and foreign producers would be justified using the:

Correct AnswerverifiedShow Answer

How have U.S. exports and imports behaved as a percentage of GDP since 1970, and with whom does the U.S. do most of its international trading?

Correct AnswerverifiedThe US does most of its intern...View AnswerShow Answer

Correct AnswerverifiedShow Answer

According to the principle of comparative advantage, trade between two countries will benefit:

Correct AnswerverifiedShow Answer

Correct Answer
verified
Dumping is the practice of selling goods...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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The US does most of its intern...
View Answer

Correct Answer
verified

Correct Answer
verified