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Chapter 20 - International Trade
50. Refer to the above diagram in which line AB is the United States production possibility
curve and AC is its trading possibilities curve. The international exchange ratio between beef
and cheese (terms of trade):
51. The impact of increasing, as opposed to constant, costs is to:
52. In the real world, specialization is rarely complete because:
Chapter 20 - International Trade
53. The law of increasing opportunity costs:
54. 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:
55. Suppose the domestic price (no-international-trade price) of wheat is $3.50 a bushel in the
United States while the world price is $4.00 a bushel. Assuming no transportation costs, the
United States will:
Chapter 20 - International Trade
56. A nation's import demand curve for a specific product:
57. A nation's export supply curve for a specific product:
58. A nation will neither export nor import a specific product when its:
Chapter 20 - International Trade
59. Export supply curves are __________________; import demand curves are
___________________.
60. Refer to the above diagram showing the domestic demand and supply curves for a specific
standardized product in a particular nation. If the world price for this product is $1.60, this
nation will experience a domestic:
Chapter 20 - International Trade
61. Refer to the above diagram showing the domestic demand and supply curves for a specific
standardized product in a particular nation. If the world price for this product is $.50, this
nation will experience a domestic:
62. Refer to the above diagram showing the domestic demand and supply curves for a specific
standardized product in a particular nation. If the world price of this product is $1, this nation
will:
63. In a two-nation model, the equilibrium world price will occur where:
Chapter 20 - International Trade
64. Refer to the above diagram pertaining to two nations and a specific product. Lines FA and
GB are:
65. Refer to the above diagram pertaining to two nations and a specific product. Lines FC and
GD are:
Chapter 20 - International Trade
66. Refer to the above diagram pertaining to two nations and a specific product. Point G is
the:
67. Refer to the above diagram pertaining to two nations and a specific product. In
equilibrium, the nation represented by lines FA and FC will:
68. Refer to the above diagram pertaining to two nations and a specific product. The
equilibrium world price occurs at:
Chapter 20 - International Trade
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69. Refer to the above diagram pertaining to two nations and a specific product. The
equilibrium level of exports and imports occurs at:
Answer the question 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.
Chapter 20 - International Trade
70. Refer to the above data. The domestic equilibrium prices of steel in Alpha and Beta are:
71. Refer to the above data. At a world price of $5:
72. Refer to the above data. At a world price of $2:
Chapter 20 - International Trade
73. Refer to the above data. Alpha's export supply is represented by:
74. Refer to the above data. Assuming that Alpha and Beta are the only two nations in the
world, the equilibrium world price must be lower than $4 because at $4:
Chapter 20 - International Trade
75. Refer to the above data. Assuming that Alpha and Beta are the only two nations in the
world, the equilibrium world price must be higher than $1 because at $1:
76. Refer to the above data. Assuming that Alpha and Beta are the only two nations in the
world, the equilibrium world price of steel must be between:
77. Refer to the above data. Assuming that Alpha and Beta are the only two nations in the
world, at the equilibrium world price:
Chapter 20 - International Trade
78. Tariffs:
79. An excise tax on an imported good that is not produced domestically is called a:
80. Excise taxes on imported goods that help shield domestic producers of the good are
called:
Chapter 20 - International Trade
81. Country A limits other nation's exports to Country A to 1,000 tons of coal annually. This
is an example of a(n):
82. Which is an example of a nontariff barrier (NTB)?
83. A tariff can best be described as:
Chapter 20 - International Trade
84. In the past, Canada has agreed to set an upper limit on the total amount of softwood
lumber sold to the United States. This is an example of a(n):
85. Suppose the United States sets a limit on the number of tons of sugar that can be imported
each year. This is an example of a(n):
Chapter 20 - International Trade
86. 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 this economy was entirely closed to
international trade, equilibrium price and quantity would be:
87. 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:
Chapter 20 - International Trade
88. 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:
89. 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 a per unit tariff in the amount PcPt,
price and total quantity sold will be:
Chapter 20 - International Trade
90. 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 a PcPt per unit tariff, the quantities sold
by foreign and domestic producers respectively will be:
91. 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 a PcPt per unit tariff, per unit revenue
received by domestic and foreign producers respectively will be:
Chapter 20 - International Trade
92. 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 a per unit tariff of PcPt, the total
amount of tariff revenue collected on this product will be:
93. Suppose the United States eliminates high tariffs on German bicycles. As a result, we
would expect:
94. In effect, tariffs on imports are:
Chapter 20 - International Trade
Answer the question on the basis of the following domestic supply and demand schedules for
a product. Suppose that the world price of the product is $1.
95. Refer to the above data. If this nation were entirely closed to international trade,
equilibrium price and quantity would be:
96. Refer to the above data. If the economy was opened to free trade and the world price of $1
prevailed, the price and quantity sold of this product would be:
Chapter 20 - International Trade
97. Refer to the above data. With free trade, that is, assuming no tariff, the outputs produced
by domestic and foreign producers respectively would be:
98. Refer to the above data. With a $1 per unit tariff, price and total quantity sold will be:
99. Refer to the above data. With a $1 per unit tariff, the quantities sold by foreign and
domestic producers respectively will be:
