Question 1

Following the tariff imposed on Chinese tires,some businesspeople correctly argued that the U.S.tariff would result in

Accepted Answer

A)  China retaliating by raising tariffs on some U.S.exports.
B)  China halting the sale of all products in the United States.
C)  U) S.firms never being able to meet the demand for U.S.-produced tires.
D)  the government demanding price cuts from U.S.tire manufacturers.E) A) and D)
F) C) and D)

Question 2

One reason a country does not specialize completely in production is that not all goods and services are traded internationally.

Accepted Answer

A) True 
 B)False

Question 3

Figure 19-10
 
-Refer to Figure 19-10.The appreciation of the dollar is represented as a movement from

Accepted Answer

A)  B to A.
B)  D to C.
C)  C to B.
D)  C to A.E) None of the above
F) A) and D)

Question 4

A Federal Reserve publication proclaimed that "Trade is a win-win situation for all countries that participate." This statement is

Accepted Answer

A)  false since it ignores the workers who lose their jobs as result of international trade.
B)  false since not all countries participate in international trade.
C)  true because it refers to countries; individuals may be losers as a result of international trade.
D)  true because all consumers and workers benefit from international trade.E) B) and D)
F) None of the above

Question 5

If the U.S.government implements a tariff on Chinese tire imports all of the following would be made worse off except

Accepted Answer

A)  U) S.consumers.
B)  American tire retailers.
C)  Chinese tire manufacturers.
D)  American tire manufacturing workers.E) B) and D)
F) B) and C)

Question 6

Which of the following will not shift the demand for the euro to the right?

Accepted Answer

A)  an increase in interest rates in the European Union
B)  an increase in incomes in countries that buy goods from the European Union
C)  expectations among speculators that the price of the euro will rise in the future
D)  a decrease in the demand for European goodsE) None of the above
F) A) and B)

Question 7

In international exchange markets,a rise in interest rates in the United States will cause the demand for dollars to ________ and the supply of dollars to ________.

Accepted Answer

A)  increase; increase
B)  increase; decrease
C)  decrease; increase
D)  decrease; decreaseE) All of the above
F) A) and B)

Question 8

The terms of trade refers to

Accepted Answer

A)  the rules and regulations that countries must adhere to when trading.
B)  the ratio at which a country can trade its exports for imports from other countries.
C)  the role of the government in overseeing international trade.
D)  a legal document that specifies the trade quantities agreed to by two countries.E) B) and C)
F) A) and D)

Question 9

An appreciating yen makes Japanese products

Accepted Answer

A)  more expensive in foreign markets.
B)  less expensive in foreign markets.
C)  more expensive in the Japanese market.
D)  more expensive in both foreign markets and the Japanese market.E) A) and B)
F) All of the above

Question 10

International trade

Accepted Answer

A)  harms consumers but helps exporting firms.
B)  helps consumers but harms exporting firms and their workers.
C)  helps consumers but hurts firms that are less efficient than their foreign competitors.
D)  helps consumers and firms that compete with their foreign competitors.E) B) and C)
F) A) and D)

Question 11

Once a country has lost its comparative advantage in producing a good,its income will be ________ and its economy will be ________ if it switches from producing the good to importing it.

Accepted Answer

A)  higher; less efficient
B)  higher; more efficient
C)  lower; less efficient
D)  lower; more efficientE) C) and D)
F) B) and C)

Question 12

Figure 19-1
  
Figure 19-1 shows the U.S.demand and supply for leather footwear.
-Refer to Figure 19-1.Suppose the government allows imports of leather footwear into the United States.What will be the domestic quantity supplied?

Accepted Answer

A)  5 units
B)  10 units
C)  15 units
D)  20 unitsE) A) and B)
F) A) and D)

Question 13

Table 19-12
Production and
Consumption Production
Without Trade With Trade
   Swards  Beltr  Svards  Beltr  Estoria 100502000 Morocco 50400120\begin{array} { | l | l | l | l | l | l | } \hline & 	ext { Swards } & 	ext { Beltr } & & 	ext { Svards } & 	ext { Beltr } \\hline 	ext { Estoria } & 100 & 50 && 200 & 0 \\hline 	ext { Morocco } & 50 & 40 && 0 & 120 \\hline\end{array} Estoria  Morocco ​ Swards 10050​ Beltr 5040​​ Svards 2000​ Beltr 0120​​  
Estonia and Morocco can produce both swords and belts.Table 19-12 shows the production and consumption quantities without trade, and the production numbers with trade.
-Refer to Table 19-12.If the actual terms of trade are 1 belt for 1.5 swords and 70 belts are traded,how many belts will Morocco consume?

Accepted Answer

A)  40
B)  50
C)  70
D)  120 E) A) and B)
F) A) and C)

Question 14

Dumping refers to countries exporting unwanted and inferior products to other countries.

Accepted Answer

A) True 
 B)False

Question 15

When BMW,an German company,purchases a welding machine that was made in Toronto,the purchase is

Accepted Answer

A)  both a German and a Canadian import.
B)  a German import and a Canadian export.
C)  a German export and a Canadian import.
D)  neither an export nor an import for either country.E) B) and C)
F) A) and C)

Question 16

Which of the following is the best example of a tariff?

Accepted Answer

A)  a subsidy from the U.S.government to domestic manufacturers of residential air conditioners to enable them to compete more effectively with foreign producers
B)  a limit on the quantity of residential air conditioners that can be imported from a foreign country
C)  a $150 fee imposed on all imported residential air conditioners
D)  a tax placed on all residential air conditioners sold in the domestic market to help offset the impact of emissions on the environmentE) B) and C)
F) A) and B)

Question 17

If the dollar appreciates,how will aggregate demand in the United States be affected?

Accepted Answer

A)  Aggregate demand will increase as exports increase and imports decrease.
B)  Aggregate demand will increase as imports increase and exports decrease.
C)  Aggregate demand will decrease as imports increase and exports decrease.
D)  Aggregate demand will decrease as exports increase and imports decrease.E) All of the above
F) None of the above

Question 18

One of the main sources of comparative advantage is internal economies.

Accepted Answer

A) True 
 B)False

Question 19

It is difficult to determine if foreign companies are selling their products for prices below their costs of production because

Accepted Answer

A)  the true costs of production are difficult to calculate.
B)  the firms have no legal obligation to reveal this information.
C)  costs are calculated in the firms' local currencies.
D)  domestic taxes increase the firms' costs but it is difficult to determine the incidence of these taxes.E) C) and D)
F) None of the above

Question 20

Figure 19-3
  
Since 1953 the United States has imposed a quota to limit the imports of peanuts. Figure 19-3 illustrates the impact of the quota.
-Refer to Figure 19-3.What is the value of domestic producer surplus after the imposition of a quota?

Accepted Answer

A)  $10.75 million
B)  $15.75 million
C)  $17.25 million
D)  $27.75 millionE) B) and D)
F) A) and B)

Exam 19: Comparative Advantage, international Trade, and Exchange Rates

If the dollar appreciates,how will aggregate demand in the United States be affected?

Correct Answer
verified

One reason a country does not specialize completely in production is that not all goods and services are traded internationally.

Correct Answer
verified

The terms of trade refers to

Correct Answer
verified

When BMW,an German company,purchases a welding machine that was made in Toronto,the purchase is

Correct Answer
verified

It is difficult to determine if foreign companies are selling their products for prices below their costs of production because

Correct Answer
verified

A Federal Reserve publication proclaimed that "Trade is a win-win situation for all countries that participate." This statement is

Correct Answer
verified

In international exchange markets,a rise in interest rates in the United States will cause the demand for dollars to and the supply of dollars to .

Correct Answer
verified

Which of the following is the best example of a tariff?

Correct Answer
verified

Once a country has lost its comparative advantage in producing a good,its income will be and its economy will be if it switches from producing the good to importing it.

Correct Answer
verified

Dumping refers to countries exporting unwanted and inferior products to other countries.

Correct Answer
verified

Correct Answer
verified

Figure 19-1 Figure 19-1 shows the U.S.demand and supply for leather footwear. -Refer to Figure 19-1.Suppose the government allows imports of leather footwear into the United States.What will be the domestic quantity supplied?

Correct Answer
verified

Figure 19-10 -Refer to Figure 19-10.The appreciation of the dollar is represented as a movement from

Correct Answer
verified

Following the tariff imposed on Chinese tires,some businesspeople correctly argued that the U.S.tariff would result in

Correct Answer
verified

One of the main sources of comparative advantage is internal economies.

Correct Answer
verified

Figure 19-3 Since 1953 the United States has imposed a quota to limit the imports of peanuts. Figure 19-3 illustrates the impact of the quota. -Refer to Figure 19-3.What is the value of domestic producer surplus after the imposition of a quota?

Correct Answer
verified

If the U.S.government implements a tariff on Chinese tire imports all of the following would be made worse off except

Correct Answer
verified

An appreciating yen makes Japanese products

Correct Answer
verified

Which of the following will not shift the demand for the euro to the right?

Correct Answer
verified

International trade

Correct Answer
verified

Exam 19: Comparative Advantage, international Trade, and Exchange Rates

If the dollar appreciates,how will aggregate demand in the United States be affected?

Correct AnswerverifiedShow Answer

One reason a country does not specialize completely in production is that not all goods and services are traded internationally.

Correct AnswerverifiedShow Answer

The terms of trade refers to

Correct AnswerverifiedShow Answer

When BMW,an German company,purchases a welding machine that was made in Toronto,the purchase is

Correct AnswerverifiedShow Answer

It is difficult to determine if foreign companies are selling their products for prices below their costs of production because

Correct AnswerverifiedShow Answer

A Federal Reserve publication proclaimed that "Trade is a win-win situation for all countries that participate." This statement is

Correct AnswerverifiedShow Answer

In international exchange markets,a rise in interest rates in the United States will cause the demand for dollars to ________ and the supply of dollars to ________.

Correct AnswerverifiedShow Answer

Which of the following is the best example of a tariff?

Correct AnswerverifiedShow Answer

Once a country has lost its comparative advantage in producing a good,its income will be ________ and its economy will be ________ if it switches from producing the good to importing it.

Correct AnswerverifiedShow Answer

Dumping refers to countries exporting unwanted and inferior products to other countries.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Figure 19-1 Figure 19-1 shows the U.S.demand and supply for leather footwear. -Refer to Figure 19-1.Suppose the government allows imports of leather footwear into the United States.What will be the domestic quantity supplied?

Correct AnswerverifiedShow Answer

Figure 19-10 -Refer to Figure 19-10.The appreciation of the dollar is represented as a movement from

Correct AnswerverifiedShow Answer

Following the tariff imposed on Chinese tires,some businesspeople correctly argued that the U.S.tariff would result in

Correct AnswerverifiedShow Answer

One of the main sources of comparative advantage is internal economies.

Correct AnswerverifiedShow Answer

Figure 19-3 Since 1953 the United States has imposed a quota to limit the imports of peanuts. Figure 19-3 illustrates the impact of the quota. -Refer to Figure 19-3.What is the value of domestic producer surplus after the imposition of a quota?

Correct AnswerverifiedShow Answer

If the U.S.government implements a tariff on Chinese tire imports all of the following would be made worse off except

Correct AnswerverifiedShow Answer

An appreciating yen makes Japanese products

Correct AnswerverifiedShow Answer

Which of the following will not shift the demand for the euro to the right?

Correct AnswerverifiedShow Answer

International trade

Correct AnswerverifiedShow Answer

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verified

In international exchange markets,a rise in interest rates in the United States will cause the demand for dollars to and the supply of dollars to .

Correct Answer
verified

Correct Answer
verified

Once a country has lost its comparative advantage in producing a good,its income will be and its economy will be if it switches from producing the good to importing it.

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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