Question 1

When a country allows trade and becomes an exporter of a good,

Accepted Answer

A)   consumer surplus and producer surplus both increase.
B)   consumer surplus and producer surplus both decrease.
C)   consumer surplus increases and producer surplus decreases.
D)   consumer surplus decreases and producer surplus increases.E) A) and B)
F) None of the above

Question 2

Figure 9-16. The figure below illustrates a tariff. On the graph, Q represents quantity and P represents price. 
-Refer to Figure 9-16. Government revenue raised by the tariff is represented by the area

Accepted Answer

A)   E.
B)   B + E.
C)   D + E + F.
D)   B + D + E + F.E) C) and D)
F) B) and C)

Question 3

Figure 9-6
The figure illustrates the market for roses in a country. 
-Refer to Figure 9-6. Without trade, the equilibrium price of roses is

Accepted Answer

A)   $4 and the equilibrium quantity is 300.
B)   $3 and the equilibrium quantity is 200.
C)   $3 and the equilibrium quantity is 400.
D)   $2 and the equilibrium quantity is 500.E) B) and C)
F) All of the above

Question 4

A common argument in favor of restricting international trade in good x is based on the premise that

Accepted Answer

A)   international trade reduces total surplus in countries that export good x.
B)   international trade reduces total surplus in countries that import good x.
C)   international trade is desirable only when countries with different domestic supplies of natural resources play by different rules when trading with one another.
D)   trade restrictions can be useful when one country bargains with its trading partners.E) A) and D)
F) None of the above

Question 5

Figure 9-12 
-Refer to Figure 9-12. Equilibrium price and equilibrium quantity without trade are

Accepted Answer

A)   $54 and 800.
B)   $54 and 1,600.
C)   $42 and 800.
D)   $42 and 1,200.E) A) and B)
F) A) and C)

Question 6

Figure 9-5
The figure illustrates the market for tricycles in a country. 
-Refer to Figure 9-5. The horizontal line at the world price of tricycles represents the

Accepted Answer

A)   demand for tricycles from the rest of the world.
B)   supply of tricycles from the rest of the world.
C)   level of inefficiency in the domestic market caused by trade.
D)   surplus in the domestic tricycle market.E) B) and C)
F) A) and C)

Question 7

The infant-industry argument

Accepted Answer

A)   is based on the belief that protecting industries when they are young will pay off later.
B)   is based on the belief that protecting industries producing goods and services for infants is necessary if a country is to have healthy children.
C)   has the support of most economists.
D)   is an argument that is advanced by advocates of free trade.E) None of the above
F) B) and C)

Question 8

For Country A, the world price of soybeans exceeds the domestic equilibrium price of soybeans. As a result, international trade allows buyers of soybeans in Country A to experience greater consumer surplus than they otherwise would experience.

Accepted Answer

A) True 
 B)False

Question 9

Workers displaced by trade eventually find jobs in

Accepted Answer

A)   another country.
B)   the government sector.
C)   the industries in which the country has a comparative advantage.
D)   a different company in the same industry.E) A) and B)
F) A) and C)

Question 10

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

Accepted Answer

A)   will import sugar.
B)   will export sugar.
C)   will either import 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 D)
F) B) and C)

Question 11

Figure 9-6
The figure illustrates the market for roses in a country. 
-Refer to Figure 9-6. When a tariff is imposed in the market, domestic producers

Accepted Answer

A)   gain $100 of producer surplus.
B)   gain $150 of producer surplus.
C)   gain $200 of producer surplus.
D)   gain $300 of producer surplus.E) B) and C)
F) None of the above

Question 12

Assume, for Vietnam, that the domestic price of textiles without international trade is higher than the world price of textiles. This suggests that, in the production of textiles,

Accepted Answer

A)   Vietnam has a comparative advantage over other countries and Vietnam will import textiles.
B)   Vietnam has a comparative advantage over other countries and Vietnam will export textiles.
C)   other countries have a comparative advantage over Vietnam and Vietnam will import textiles.
D)   other countries have a comparative advantage over Vietnam and Vietnam will export textiles.E) B) and C)
F) B) and D)

Question 13

Figure 9-29
The following diagram shows the domestic demand and domestic supply curves in a market. Assume that the world price in this market is $1 per unit. 
-Refer to Figure 9-29. Suppose the country imposes a $1 per unit tariff. If the country allows trade with a tariff, how many units will domestic consumers demand and how many units will domestic producers supply?

Accepted Answer

With trade and a tariff, domes...

Question 14

Figure 9-20
The figure illustrates the market for rice in Vietnam. 
-Refer to Figure 9-20. Given that Vietnam is a small country, it is apparent from the figure that

Accepted Answer

A)   Vietnam will export rice if trade is allowed.
B)   Vietnam will import rice if trade is allowed.
C)   Vietnam has nothing to gain either by importing or exporting rice.
D)   the world price will fall if Vietnam begins to allow its citizens to trade with other countries.E) A) and C)
F) A) and B)

Question 15

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) C) and D)
F) None of the above

Question 16

The results of a 2008 Los Angeles Times poll suggest that the percentage of Americans who believe trade is harmful to the economy exceeds the percentage of Americans who believe trade is beneficial to the economy.

Accepted Answer

A) True 
 B)False

Question 17

Most economists view the United States as an ongoing experiment that raises serious doubts about the virtues of free trade.

Accepted Answer

A) True 
 B)False

Question 18

Figure 9-16. The figure below illustrates a tariff. On the graph, Q represents quantity and P represents price. 
-Refer to Figure 9-16. The tariff

Accepted Answer

A)   decreases producer surplus by the area C and decreases consumer surplus by the area C + D + E + F.
B)   decreases producer surplus by the area C + D and decreases consumer surplus by the area D + E + F.
C)   increases producer surplus by the area C and decreases consumer surplus by the area C + D + E + F.
D)   increases producer surplus by the area B + C and decrease consumer surplus by the area D + E + F.E) All of the above
F) None of the above

Question 19

Figure 9-24
The following diagram shows the domestic demand and supply in a market. Assume that the world price in this market is $20 per unit. 
-Refer to Figure 9-24. With free trade, total surplus is

Accepted Answer

A)   $500.
B)   $800.
C)   $1,000.
D)   $1,300.E) B) and C)
F) None of the above

Question 20

Figure 9-29
The following diagram shows the domestic demand and domestic supply curves in a market. Assume that the world price in this market is $1 per unit. 
-Refer to Figure 9-29. With no trade allowed, what are the equilibrium price and equilibrium quantity in this market?

Accepted Answer

The equilibrium pric...

Exam 9: Application: International Trade

Figure 9-16. The figure below illustrates a tariff. On the graph, Q represents quantity and P represents price. -Refer to Figure 9-16. Government revenue raised by the tariff is represented by the area

Correct Answer
verified

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

Correct Answer
verified

Figure 9-5 The figure illustrates the market for tricycles in a country. -Refer to Figure 9-5. The horizontal line at the world price of tricycles represents the

Correct Answer
verified

A common argument in favor of restricting international trade in good x is based on the premise that

Correct Answer
verified

Figure 9-6 The figure illustrates the market for roses in a country. -Refer to Figure 9-6. Without trade, the equilibrium price of roses is

Correct Answer
verified

Assume, for Vietnam, that the domestic price of textiles without international trade is higher than the world price of textiles. This suggests that, in the production of textiles,

Correct Answer
verified

Figure 9-24 The following diagram shows the domestic demand and supply in a market. Assume that the world price in this market is $20 per unit. -Refer to Figure 9-24. With free trade, total surplus is

Correct Answer
verified

The results of a 2008 Los Angeles Times poll suggest that the percentage of Americans who believe trade is harmful to the economy exceeds the percentage of Americans who believe trade is beneficial to the economy.

Correct Answer
verified

When a country allows trade and becomes an exporter of a good,

Correct Answer
verified

Figure 9-29 The following diagram shows the domestic demand and domestic supply curves in a market. Assume that the world price in this market is $1 per unit. -Refer to Figure 9-29. With no trade allowed, what are the equilibrium price and equilibrium quantity in this market?

Correct Answer
verified
The equilibrium pric...
View Answer

Correct Answer
verified
With trade and a tariff, domes...
View Answer

Figure 9-16. The figure below illustrates a tariff. On the graph, Q represents quantity and P represents price. -Refer to Figure 9-16. The tariff

Correct Answer
verified

Figure 9-6 The figure illustrates the market for roses in a country. -Refer to Figure 9-6. When a tariff is imposed in the market, domestic producers

Correct Answer
verified

Most economists view the United States as an ongoing experiment that raises serious doubts about the virtues of free trade.

Correct Answer
verified

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

Correct Answer
verified

Figure 9-12 -Refer to Figure 9-12. Equilibrium price and equilibrium quantity without trade are

Correct Answer
verified

Workers displaced by trade eventually find jobs in

Correct Answer
verified

For Country A, the world price of soybeans exceeds the domestic equilibrium price of soybeans. As a result, international trade allows buyers of soybeans in Country A to experience greater consumer surplus than they otherwise would experience.

Correct Answer
verified

The infant-industry argument

Correct Answer
verified

Figure 9-20 The figure illustrates the market for rice in Vietnam. -Refer to Figure 9-20. Given that Vietnam is a small country, it is apparent from the figure that

Correct Answer
verified

Exam 9: Application: International Trade

Figure 9-16. The figure below illustrates a tariff. On the graph, Q represents quantity and P represents price. -Refer to Figure 9-16. Government revenue raised by the tariff is represented by the area

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Figure 9-5 The figure illustrates the market for tricycles in a country. -Refer to Figure 9-5. The horizontal line at the world price of tricycles represents the

Correct AnswerverifiedShow Answer

A common argument in favor of restricting international trade in good x is based on the premise that

Correct AnswerverifiedShow Answer

Figure 9-6 The figure illustrates the market for roses in a country. -Refer to Figure 9-6. Without trade, the equilibrium price of roses is

Correct AnswerverifiedShow Answer

Assume, for Vietnam, that the domestic price of textiles without international trade is higher than the world price of textiles. This suggests that, in the production of textiles,

Correct AnswerverifiedShow Answer

Figure 9-24 The following diagram shows the domestic demand and supply in a market. Assume that the world price in this market is $20 per unit. -Refer to Figure 9-24. With free trade, total surplus is

Correct AnswerverifiedShow Answer

The results of a 2008 Los Angeles Times poll suggest that the percentage of Americans who believe trade is harmful to the economy exceeds the percentage of Americans who believe trade is beneficial to the economy.

Correct AnswerverifiedShow Answer

When a country allows trade and becomes an exporter of a good,

Correct AnswerverifiedShow Answer

Figure 9-29 The following diagram shows the domestic demand and domestic supply curves in a market. Assume that the world price in this market is $1 per unit. -Refer to Figure 9-29. With no trade allowed, what are the equilibrium price and equilibrium quantity in this market?

Correct AnswerverifiedThe equilibrium pric...View AnswerShow Answer

Correct AnswerverifiedWith trade and a tariff, domes...View AnswerShow Answer

Figure 9-16. The figure below illustrates a tariff. On the graph, Q represents quantity and P represents price. -Refer to Figure 9-16. The tariff

Correct AnswerverifiedShow Answer

Figure 9-6 The figure illustrates the market for roses in a country. -Refer to Figure 9-6. When a tariff is imposed in the market, domestic producers

Correct AnswerverifiedShow Answer

Most economists view the United States as an ongoing experiment that raises serious doubts about the virtues of free trade.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Figure 9-12 -Refer to Figure 9-12. Equilibrium price and equilibrium quantity without trade are

Correct AnswerverifiedShow Answer

Workers displaced by trade eventually find jobs in

Correct AnswerverifiedShow Answer

For Country A, the world price of soybeans exceeds the domestic equilibrium price of soybeans. As a result, international trade allows buyers of soybeans in Country A to experience greater consumer surplus than they otherwise would experience.

Correct AnswerverifiedShow Answer

The infant-industry argument

Correct AnswerverifiedShow Answer

Figure 9-20 The figure illustrates the market for rice in Vietnam. -Refer to Figure 9-20. Given that Vietnam is a small country, it is apparent from the figure that

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The equilibrium pric...
View Answer

Correct Answer
verified
With trade and a tariff, domes...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified