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Exam 20: International Trade

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Question 91

Multiple Choice

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Refer to the graphs. Terryville has a comparative advantage in producing

A) product A.
B) product B.
C) both products A and B.
D) neither product A nor B.

E) A) and B)
F) A) and C)

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Question 92

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The law of increasing opportunity costs limits international specialization.

A) True
B) False

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Question 93

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As it relates to international trade, dumping

"The nation needs to prevent foreign nations from selling their excess goods in our nation at a price below cost so we can save American firms." This quotation would be most closely associated with Which protectionist argument?

Some people accuse an offshoring firm of "exporting jobs". This activity called offshoring is really equivalent to

$\quad\quad { Country ~X }$ $\begin{array} { | c | c | c | } \hline Price & Q _ { d d } & Q _ { S d } \\\hline \$ 5.00 & 200 & 400 \\\hline 4.00 & 250 & 350 \\\hline 3.00 & 300 & 300 \\\hline 2.00 & 350 & 250 \\\hline 1.00 & 400 & 200 \\\hline\end{array}$ The accompanying table gives data for Country $X$ . Column 1 of the table is the price of a product. Column 2 is the quantity demanded domestically $\left(Q_{d d}\right)$ , and Column 3 is the quantity supplied domestically $\left(Q_{s d}\right)$ . If Country $X$ opens itself up to international trade and the world-market price of the product is $\$ 3$ , then Country $X$ will

A nation with abundant capital resources tends to be an exporter of

An excise tax that is applied to an imported product that is not at all produced domestically is called a(n)

$\quad\quad { Country ~Y }$ $\begin{array} { | c | c | c | } \hline Price & Q _ { \text {dd } } & Q _ { \text {sd } } \\\hline \$ 9.00 & 250 & 450 \\\hline 8.00 & 300 & 400 \\\hline 7.00 & 350 & 350 \\\hline 6.00 & 400 & 300 \\\hline\end{array}$ The accompanying table gives data for Country Y. Column 1 is the price of a product. Column 2 is the quantity demanded domestically $\left( Q _ { d d } \right)$ , and Column 3 is the quantity supplied domestically $\left( Q _ { s d } \right)$ . At what price will Country $Y$ export 100 units of the product?

Whenever a foreign producer is selling a product like steel at a lower price than domestic producers, then dumping is being practiced and must be corrected.

Benefits from international trade are based on differences in the following areas, except

The benefits to trading nations based on comparative advantage accrue from

In a two-nation, two-good world, which of the following statements is true?

Which is not a commonly heard argument for protectionism?

Cite three important reasons why nations trade.

During the Great Depression, most nations lowered tariffs and abolished import quotas to encourage the flow of trade.

Refer to the diagram, where $S _ { d }$ and $D _ { d }$ are the domestic supply and demand for a product and $P _ { c }$ is The world price of that product. With free trade, that is, assuming no tariff, the outputs produced by Domestic and foreign producers, respectively, would be

The tables give production possibilities data for two countries, Alpha and Beta, which have populations of equal size. ${ \text { Alpha's production possibilities } }$ $\begin{array}{l}\begin{array} { | l | c | c | c | c | c | } \hline & A & B & C & D & E \\\hline \text { Fish (Tons) } & 80 & 60 & 40 & 20 & 0 \\\hline \text { Chips (Tons) } & 0 & 5 & 10 & 15 & 20 \\\hline\end{array}\\\\\\{ \text { Beta's production possibilities } } \\\begin{array} { | l | c | c | c | c | c | } \hline & A & B & C & D & E \\\hline \text { Fish (Tons) } & 240 & 180 & 120 & 60 & 0 \\\hline \text { Chips (Tons) } & 0 & 10 & 20 & 30 & 40 \\\hline\end{array}\end{array}$ The given data show that

Which country has the largest share of total world exports?

$\begin{array} { | l | c | c | } \hline & \text { Wine } & \text { Machines } \\\hline \text { Brazil } & 30 & 10 \\\hline \text { Poland } & 10 & 10 \\\hline\end{array}$ The accompanying table gives maximum-output alternatives for Brazil and Poland. It can be seen that if the two nations open up trade with each other, then