Ch.20 Quiz

Instructions
Please read the questions carefully.

This assessment is worth 100 points.

  1. In terms of absolute volume, world trade is dominated by:   (4 points)

    a.  
    b.  
    c.  
    d.  

  2. Which of the following is an example of a capital-intensive commodity?   (4 points)

    a.  
    b.  
    c.  
    d.  

  3. Countries engaged in international trade specialize in production based on:   (4 points)

    a.  
    b.  
    c.  
    d.  

  4. In the theory of comparative advantage, a good should be produced in that nation where:   (4 points)

    a.  
    b.  
    c.  
    d.  

  5. Answer the next question(s) on the basis of the following information about the cost ratios for two products--fish (F) and chicken (C)--in Singsong and Harmony. Assume that production occurs under conditions of constant costs and these are the only two nations in the world.

    Singsong: 1F = 2C
    Harmony: 1F = 4C


    Refer to the above information. Which one of the following would not be feasible terms for trade between Singsong and Harmony?   (4 points)

    a.  
    b.  
    c.  
    d.  




  6. Refer to the above graphs. These production possibilities curves:   (4 points)

    a.  
    b.  
    c.  
    d.  

  7. The impact of increasing, as opposed to constant, costs is to:   (4 points)

    a.  
    b.  
    c.  
    d.  

  8. Suppose the domestic price (no-international-trade price) of copper is $1.20 a pound in the United States while the world price is $1.00 a pound. Assuming no transportation costs, the United States will:   (4 points)

    a.  
    b.  
    c.  
    d.  

  9. A nation's export supply curve for a specific product:   (4 points)

    a.  
    b.  
    c.  
    d.  



  10. Refer to the above diagram pertaining to two nations and a specific product. Point G is the:   (4 points)

    a.  
    b.  
    c.  
    d.  

  11. Answer the next question(s) on the basis of the following data for the hypothetical nations of Alpha and Beta. Qs is domestic quantity supplied and Qd is domestic quantity demanded.



    Refer to the above data. The equilibrium world price must be lower than $4 because at $4:   (4 points)

    a.  
    b.  
    c.  
    d.  

  12. Country A limits other nation's exports to Country A to 1,000 tons of coal annually. This is an example of a(n):   (4 points)

    a.  
    b.  
    c.  
    d.  

  13. Which is an example of a nontariff barrier (NTB)?   (4 points)

    a.  
    b.  
    c.  
    d.  

  14.       

    Refer to the above diagram, where Sd and Dd are the domestic supply and demand for a product and Pc is the world price of that product. If the economy is opened to free trade, the price and quantity sold of this product would be:   (4 points)

    a.  
    b.  
    c.  
    d.  

  15.       

    Refer to the above diagram, where Sd and Dd are the domestic supply and demand for a product and Pc 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:   (4 points)

    a.  
    b.  
    c.  
    d.  

  16. Answer the next question(s) on the basis of the following domestic supply and demand schedules for a product. Suppose that the world price of the product is $1.



    Refer to the above data. If this nation were entirely closed to international trade, equilibrium price and quantity would be:   (4 points)

    a.  
    b.  
    c.  
    d.  

  17.       

    Refer to the above diagram, where Sd and Dd are the domestic supply and demand for a product and Pc is the world price of that product. Sd + Q is the product supply curve after an import quota is imposed. The size of the import quota:   (4 points)

    a.  
    b.  
    c.  
    d.  

  18.       

    Refer to the above diagram, where Sd and Dd are the domestic supply and demand for a product and Pc is the world price of that product. Sd + Q is the product supply curve after an import quota is imposed. A quota of wy will:   (4 points)

    a.  
    b.  
    c.  
    d.  

  19. The infant industry argument for tariffs is criticized:   (4 points)

    a.  
    b.  
    c.  
    d.  

  20. As it relates to international trade, dumping:   (4 points)

    a.  
    b.  
    c.  
    d.  

  21. As it relates to income distribution, the domestic overcharge resulting from tariffs and quotas is:   (4 points)

    a.  
    b.  
    c.  
    d.  

  22. In 2001, the number of countries belonging to the World Trade Organization (WTO) was.   (4 points)

    a.  
    b.  
    c.  
    d.  

  23. (Last Word) The main point of the "Petition of the Candlemakers" is that:   (4 points)

    a.  
    b.  
    c.  
    d.  

  24. The nation that has a comparative advantage in a particular product will be the only world exporter of that product.   (4 points)

    a.  
    b.  

  25. Barriers to free trade impair efficiency in the international allocation of resources.   (4 points)

    a.  
    b.  



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