Question 1

Figure 9-13. On the diagram below, Q represents the quantity of computers and P represents the price of computers.
 
-Refer to Figure 9-13.When the country for which the figure is drawn allows international trade in computers,

Accepted Answer

A)  consumer surplus changes from the area A + B + D to the area a.
B)  producer surplus changes from the area C to the area B + C + D.
C)  total surplus decreases by the area D.
D)  All of the above are correct.E) None of the above
F) B) and D)

Question 2

If the United Kingdom imports tea cups from other countries,then U.K.producers of tea cups are better off,and U.K.consumers of tea cups are worse off,as a result of trade.

Accepted Answer

A) True 
 B)False

Question 3

Figure 9-8
 
-Refer to Figure 9-8.Total surplus in this market before trade is

Accepted Answer

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

Question 4

At present,the United States uses a system of quotas to limit the amount of sugar imported into the country.Which of the following statements is most likely true?

Accepted Answer

A)  The quotas are probably the result of lobbying from U.S.consumers of sugar.The quotas increase consumer surplus for the United States, reduce producer surplus for the United States, and harm foreign sugar producers.
B)  The quotas are probably the result of lobbying from U.S.producers of sugar.The quotas increase producer surplus for the United States, reduce consumer surplus for the United States, and harm foreign sugar producers.
C)  The quotas are probably the result of lobbying from foreign producers of sugar.The quotas reduce producer surplus for the United States, increase consumer surplus for the United States, and benefit foreign sugar producers.
D)  U.S.lawmakers did not need to be lobbied to impose the quotas because total surplus for the United States is higher with the quotas than without them.E) None of the above
F) All of the above

Question 5

Use the graph to answer the following questions about CDs.
  
a.What is the equilibrium price of CDs before trade?
b.What is the equilibrium quantity of CDs before trade?
c.What is the price of CDs after trade is allowed?
d.What is the quantity of CDs exported after trade is allowed?
e.What is the amount of consumer surplus before trade?
f.What is the amount of consumer surplus after trade?
g.What is the amount of producer surplus before trade?
h.What is the amount of producer surplus after trade?
i.What is the amount of total surplus before trade?
j.What is the amount of total surplus after trade?
k.What is the change in total surplus because of trade?

Accepted Answer

a. $12
b. 50
c. $15
...

Question 6

Characterize the two different approaches a nation can take to achieve free trade.Does one approach have an advantage over the other?

Accepted Answer

A unilateral approach is when a country ...

Question 7

If the United States imposes a tariff on automobiles,then

Accepted Answer

A)  total surplus in the American automobile market decreases.
B)  producer surplus in the American automobile market increases.
C)  U.S.imports of foreign automobiles decrease.
D)  All of the above are correct.E) A) and D)
F) B) and C)

Question 8

Suppose Haiti has a comparative advantage over other countries in producing sugar,but other countries have an absolute advantage over Haiti in producing sugar.If trade in sugar is allowed,Haiti

Accepted Answer

A)  will import sugar.
B)  will export sugar.
C)  will either export sugar or export sugar, but it is not clear from the given information.
D)  would have nothing to gain either from exporting or importing sugar.E) A) and B)
F) All of the above

Question 9

When the nation of Duxembourg allows trade and becomes an importer of software,

Accepted Answer

A)  residents of Duxembourg who produce software become worse off; residents of Duxembourg who buy software become better off; and the economic well-being of Duxembourg rises.
B)  residents of Duxembourg who produce software become worse off; residents of Duxembourg who buy software become better off; and the economic well-being of Duxembourg falls.
C)  residents of Duxembourg who produce software become better off; residents of Duxembourg who buy software become worse off; and the economic well-being of Duxembourg rises.
D)  residents of Duxembourg who produce software become better off; residents of Duxembourg who buy software become worse off; and the economic well-being of Duxembourg falls.E) A) and C)
F) A) and D)

Question 10

Figure 9-15. The figure below illustrates a tariff. On the graph, Q represents quantity and P represents price.
 
-Refer to Figure 9-15.The deadweight loss created by the tariff is represented by the area

Accepted Answer

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

Question 11

Figure 9-11
 
-Refer to Figure 9-11.Equilibrium price and equilibrium quantity without trade are

Accepted Answer

A)  $18 and 400.
B)  $18 and 800.
C)  $14 and 400.
D)  $14 and 600.E) None of the above
F) A) and C)

Question 12

If the world price of a good is greater than the domestic price in a country that can engage in international trade,then that country becomes an importer of that good.

Accepted Answer

A) True 
 B)False

Question 13

What percent of total world trade is accounted for by countries that belong to the World Trade Organization?

Accepted Answer

A)  54 percent
B)  72 percent
C)  89 percent
D)  97 percentE) All of the above
F) C) and D)

Question 14

In analyzing the gains and losses from international trade,to say that Moldova is a small country is to say that

Accepted Answer

A)  Moldova can only import goods; it cannot export goods.
B)  Moldova's choice of which goods to export and which goods to import is not based on the principle of comparative advantage.
C)  only the domestic price of a good is relevant for Moldova; the world price of a good is irrelevant.
D)  Moldova is a price taker.E) A) and B)
F) B) and C)

Question 15

The world price of a simple electronic calculator is $5.00.Before Singapore allowed trade in calculators,the price of a calculator there was $4.00.Once Singapore began allowing trade in calculators with other countries,Singapore began

Accepted Answer

A)  importing calculators and the price of a calculator in Singapore increased to $5.00.
B)  importing calculators and the price of a calculator in Singapore remained at $4.00.
C)  exporting calculators and the price of a calculator in Singapore increased to $5.00.
D)  exporting calculators and the price of a calculator in Singapore remained at $4.00.E) All of the above
F) B) and C)

Question 16

If the demand curve and the supply curve for a good are straight lines,then the deadweight loss that results from a tariff is represented on the supply-and-demand graph by

Accepted Answer

A)  the area of one triangle.
B)  the area of one rectangle.
C)  the combined areas of two different triangles.
D)  the combined areas of two different rectangles.E) A) and C)
F) A) and D)

Question 17

Figure 9-14
 
-Refer to Figure 9-14.Producer surplus with trade and without a tariff is

Accepted Answer

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

Question 18

A logical starting point from which the study of international trade begins is

Accepted Answer

A)  the recognition that not all markets are competitive.
B)  the recognition that government intervention in markets sometimes enhances the economic welfare of the society.
C)  the principle of absolute advantage.
D)  the principle of comparative advantage.E) C) and D)
F) A) and B)

Question 19

Figure 9-10
 
-Refer to Figure 9-10.Producer surplus in this market before trade is

Accepted Answer

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

Question 20

Opponents of free trade often want the United States to prohibit the import of goods made in overseas factories that pay wages below the U.S.minimum wage.Prohibiting such goods is likely to

Accepted Answer

A)  cause these factories to pay the U.S.minimum wage.
B)  increase the rate of technological advance in poor countries so that they can afford to pay higher wages.
C)  increase poverty in poor countries and benefit U.S.firms which compete with these imports.
D)  harm U.S.firms which compete with these imports.E) B) and D)
F) None of the above

Exam 9: Application: International Trade

If the United Kingdom imports tea cups from other countries,then U.K.producers of tea cups are better off,and U.K.consumers of tea cups are worse off,as a result of trade.

Correct Answer
verified

Suppose Haiti has a comparative advantage over other countries in producing sugar,but other countries have an absolute advantage over Haiti in producing sugar.If trade in sugar is allowed,Haiti

Correct Answer
verified

If the demand curve and the supply curve for a good are straight lines,then the deadweight loss that results from a tariff is represented on the supply-and-demand graph by

Correct Answer
verified

In analyzing the gains and losses from international trade,to say that Moldova is a small country is to say that

Correct Answer
verified

A logical starting point from which the study of international trade begins is

Correct Answer
verified

When the nation of Duxembourg allows trade and becomes an importer of software,

Correct Answer
verified

Figure 9-14 -Refer to Figure 9-14.Producer surplus with trade and without a tariff is

Correct Answer
verified

Figure 9-10 -Refer to Figure 9-10.Producer surplus in this market before trade is

Correct Answer
verified

Correct Answer
verified
a. $12
b. 50
c. $15
...
View Answer

Figure 9-13. On the diagram below, Q represents the quantity of computers and P represents the price of computers. -Refer to Figure 9-13.When the country for which the figure is drawn allows international trade in computers,

Correct Answer
verified

If the United States imposes a tariff on automobiles,then

Correct Answer
verified

Figure 9-11 -Refer to Figure 9-11.Equilibrium price and equilibrium quantity without trade are

Correct Answer
verified

The world price of a simple electronic calculator is $5.00.Before Singapore allowed trade in calculators,the price of a calculator there was $4.00.Once Singapore began allowing trade in calculators with other countries,Singapore began

Correct Answer
verified

If the world price of a good is greater than the domestic price in a country that can engage in international trade,then that country becomes an importer of that good.

Correct Answer
verified

Figure 9-8 -Refer to Figure 9-8.Total surplus in this market before trade is

Correct Answer
verified

Opponents of free trade often want the United States to prohibit the import of goods made in overseas factories that pay wages below the U.S.minimum wage.Prohibiting such goods is likely to

Correct Answer
verified

What percent of total world trade is accounted for by countries that belong to the World Trade Organization?

Correct Answer
verified

Figure 9-15. The figure below illustrates a tariff. On the graph, Q represents quantity and P represents price. -Refer to Figure 9-15.The deadweight loss created by the tariff is represented by the area

Correct Answer
verified

Characterize the two different approaches a nation can take to achieve free trade.Does one approach have an advantage over the other?

Correct Answer
verified
A unilateral approach is when a country ...
View Answer

At present,the United States uses a system of quotas to limit the amount of sugar imported into the country.Which of the following statements is most likely true?

Correct Answer
verified

Exam 9: Application: International Trade

If the United Kingdom imports tea cups from other countries,then U.K.producers of tea cups are better off,and U.K.consumers of tea cups are worse off,as a result of trade.

Correct AnswerverifiedShow Answer

Suppose Haiti has a comparative advantage over other countries in producing sugar,but other countries have an absolute advantage over Haiti in producing sugar.If trade in sugar is allowed,Haiti

Correct AnswerverifiedShow Answer

If the demand curve and the supply curve for a good are straight lines,then the deadweight loss that results from a tariff is represented on the supply-and-demand graph by

Correct AnswerverifiedShow Answer

In analyzing the gains and losses from international trade,to say that Moldova is a small country is to say that

Correct AnswerverifiedShow Answer

A logical starting point from which the study of international trade begins is

Correct AnswerverifiedShow Answer

When the nation of Duxembourg allows trade and becomes an importer of software,

Correct AnswerverifiedShow Answer

Figure 9-14 -Refer to Figure 9-14.Producer surplus with trade and without a tariff is

Correct AnswerverifiedShow Answer

Figure 9-10 -Refer to Figure 9-10.Producer surplus in this market before trade is

Correct AnswerverifiedShow Answer

Correct Answerverifieda. $12b. 50c. $15...View AnswerShow Answer

Figure 9-13. On the diagram below, Q represents the quantity of computers and P represents the price of computers. -Refer to Figure 9-13.When the country for which the figure is drawn allows international trade in computers,

Correct AnswerverifiedShow Answer

If the United States imposes a tariff on automobiles,then

Correct AnswerverifiedShow Answer

Figure 9-11 -Refer to Figure 9-11.Equilibrium price and equilibrium quantity without trade are

Correct AnswerverifiedShow Answer

The world price of a simple electronic calculator is $5.00.Before Singapore allowed trade in calculators,the price of a calculator there was $4.00.Once Singapore began allowing trade in calculators with other countries,Singapore began

Correct AnswerverifiedShow Answer

If the world price of a good is greater than the domestic price in a country that can engage in international trade,then that country becomes an importer of that good.

Correct AnswerverifiedShow Answer

Figure 9-8 -Refer to Figure 9-8.Total surplus in this market before trade is

Correct AnswerverifiedShow Answer

Opponents of free trade often want the United States to prohibit the import of goods made in overseas factories that pay wages below the U.S.minimum wage.Prohibiting such goods is likely to

Correct AnswerverifiedShow Answer

What percent of total world trade is accounted for by countries that belong to the World Trade Organization?

Correct AnswerverifiedShow Answer

Figure 9-15. The figure below illustrates a tariff. On the graph, Q represents quantity and P represents price. -Refer to Figure 9-15.The deadweight loss created by the tariff is represented by the area

Correct AnswerverifiedShow Answer

Characterize the two different approaches a nation can take to achieve free trade.Does one approach have an advantage over the other?

Correct AnswerverifiedA unilateral approach is when a country ...View AnswerShow Answer

At present,the United States uses a system of quotas to limit the amount of sugar imported into the country.Which of the following statements is most likely true?

Correct AnswerverifiedShow Answer

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a. $12
b. 50
c. $15
...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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A unilateral approach is when a country ...
View Answer

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