1) figure 5.6 domestice supply and demand for wine – us
consider figure 5.6.in the global market for wine, the eu is willing to supply as much
wine as the us demands at $8 per bottle.if the us imposes a quota of 15 bottles of wine ,
how much revenue will the us government collect?
a.0
b.$35
c.$70
d.$105
2) which indicator of international debt burden schedules interest and principal
payments on long-term debt as a percent of export earnings?
a.debt service ratio
b.debt-to-export ratio
c.ratio of external debt to gross domestic product
d.ratio of external debt to gross national product
3) which nation accounts for the largest amount of opec’s oil reserves and production?
a.iran
b.libya
c.iraq
d.saudi arabia
4) a specification of a maximum amount of a foreign produced good that will be
allowed to enter the country over a given time period is referred to as:
a.a domestic subsidy
b.an export subsidy
c.an import quota
d.an export quota
5) direct foreign investment has taken all of the following forms except:
a.investors buying bonds of an existing firm overseas
b.the creation of a wholly owned business enterprise overseas
c.the takeover of an existing company overseas
d.the construction of a manufacturing plant overseas
6) if the spot price of the swiss franc is $0.4020 and the 90-day forward franc sells for
$0.4026, the franc is at a 90-day forward discount of $0.0006, or at a 0.2 percent
forward discount per annum against the dollar.
a.true
b.false
7) figure 6.3 represents the iraqi computer market. assume iraq purchases all of its
computers from the united states.
figure 6.3 iraqi computer market and economic sanctions
consider figure 6.3. of the quota-induced change in iraqi consumer surplus, the amount
of the change in iraq’s consumer surplus that is transferred to other sectors of iraq’s
economy is captured by the united states as:
a.tax revenue
b.export revenue
c.producer surplus
d.consumer surplus
8) eurodollars are:
a.dollar-denominated deposits in overseas banks
b.european currencies used to finance transactions in the united states
c.dollars that u.s. residents spend in europe
d.european currencies used to finance imports from the united states
9) to reduce their exposure to developing country debt, lending commercial banks have
practiced all of the following except:
a.making outright loan sales to other commercial banks
b.reducing their capital base as a cushion against losses
c.dealing in debt-for-debt swaps with foreign governments
d.dealing in debt/equity swaps with foreign governments
10) figure 7.3. world oil market
consider figure 7.3. under a profit-maximizing cartel, producers realize:
a.profits totaling $280
b.profits totaling $360
c.losses totaling $140
d.losses totaling $180
11) with decreasing costs, a country has an incentive to partially specialize in the
product of its comparative advantage.
a.true
b.false
12) the largest amount of trade with the united states in recent years has been conducted
by:
a.canada
b.germany
c.chile
d.united kingdom
13) increased foreign competition tends to increase profits of domestic
import-competing companies.
a.true
b.false