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Chapter 20 - International Trade
1. United States exports of goods and services (on a national income account basis) are about:
2. The United States' most important trading partner quantitatively is:
Chapter 20 - International Trade
3. In recent years the United States has:
4. As a percentage of GDP, U.S. exports are:
5. Which of the following statements is false?
Chapter 20 - International Trade
6. Which country has the largest share of total world exports?
7. In terms of absolute dollar volume, the top 3 leaders in world exports are:
8. In 2009, the United States:
Chapter 20 - International Trade
9. Which of the following is an example of a land-intensive commodity?
10. Which of the following is an example of a labor-intensive commodity?
Chapter 20 - International Trade
12. Differences in production efficiencies among nations in producing a particular good result
from:
13. Countries engaged in international trade specialize in production based on:
14. In order for mutually beneficial trade to occur between two otherwise isolated nations:
Chapter 20 - International Trade
Answer the question on the basis of the following production possibilities data for Gamma
and Sigma. All data are in tons.
Gamma's production possibilities:
Sigma's production possibilities:
15. On the basis of the above information:
16. Refer to the above data. What are the limits of the terms of trade between Gamma and
Sigma?
Chapter 20 - International Trade
17. Refer to the above data. Assume that before specialization and trade Gamma and Sigma
both chose production possibility "C." Now if each specializes according to comparative
advantage, the gains from specialization and trade will be:
18. If country A can produce both goods X and Y more efficiently, that is, with smaller
absolute amounts of resources, than can country B:
19. The terms of trade reflect the:
Chapter 20 - International Trade
20-8
20. Assume that by devoting all of its resources to the production of X, nation Alpha can
produce 40 units of X. By devoting all of its resources to Y, Alpha can produce 60Y.
Comparable figures for nation Beta are 60X and 40Y. We can conclude that:
Answer the question on the basis of the following production possibilities tables for two
countries, Latalia and Trombonia:
Chapter 20 - International Trade
21. The above data indicate that production in:
22. Refer to the above tables. In Latalia the domestic real cost of 1 ton of pork:
23. Refer to the above tables. If these two nations specialize on the basis of comparative
Chapter 20 - International Trade
24. Refer to the above tables. Assume that before specialization and trade, Latalia produced
combination C and Trombonia produced combination B. If these two nations now specialize
completely based on comparative advantage, the total gains from specialization and trade will
be:
25. Refer to the above tables. Which of the following would be feasible terms for trade
between Latalia and Trombonia?
26. In the theory of comparative advantage, a good should be produced in that nation where:
Chapter 20 - International Trade
27. If two nations have straight-line production possibilities curves:
Chapter 20 - International Trade
28. Refer to the above diagrams. The solid lines are production possibilities curves; the
dashed lines are trading possibilities curves. The data contained in the production possibilities
curves are based on the assumption of:
29. Refer to the above diagrams. The solid lines are production possibilities curves; the
dashed lines are trading possibilities curves. The opportunity cost of producing a:
30. Refer to the above diagrams. The solid lines are production possibilities curves; the
dashed lines are trading possibilities curves. The data suggest that:
Chapter 20 - International Trade
31. Refer to the above diagrams. The solid lines are production possibilities curves; the
dashed lines are trading possibilities curves. The trading possibilities curves imply that:
32. Refer to the above diagrams. The solid lines are production possibilities curves; the
dashed lines are trading possibilities curves. The trading possibilities curves suggest that the
terms of trade are:
33. The fact that international specialization and trade based on comparative advantage can
increase world output is demonstrated by the reality that:
Chapter 20 - International Trade
Answer the question on the basis of the following information about the cost ratios for two
products-fish (F) and chicken (C)-in countries 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
34. Refer to the above information. In Singsong the domestic real cost of each chicken:
35. Refer to the above information. If these two nations specialize based on comparative
advantage:
Chapter 20 - International Trade
36. Refer to the above information. Which one of the following would not be feasible terms
for trade between Singsong and Harmony?
37. The primary gain from international trade is:
Chapter 20 - International Trade
38. The production possibilities curves above suggest that:
39. Assuming labor forces of equal size, the production possibilities curves above suggest that
workers in West Mudville will have:
40. If a nation has a comparative advantage in the production of X, this means the nation:
Chapter 20 - International Trade
41. Refer to the above graphs. Stanville has a comparative advantage in producing:
42. Refer to the above graphs. Terryville has a comparative advantage in producing:
Chapter 20 - International Trade
43. Refer to the above graphs. These production possibilities curves:
Answer the question on the basis of the following production possibilities data for two
countries, Alpha and Beta, which have populations of equal size.
44. The above data show that:
Chapter 20 - International Trade
45. Refer to the above data. The domestic opportunity cost of:
46. Refer to the above data. Beta:
47. Refer to the above data. Suppose that before specialization and trade Alpha chose
production alternative C and Beta chose production alternative B. After specialization and
trade the gains will be:
Chapter 20 - International Trade
48. Refer to the above data. Assume the production possibilities in Beta double at alternatives
49. Refer to the above diagram in which line AB is the United States production possibility
curve and AC is its trading possibilities curve. We can conclude that the United States:
