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Exam 9: International Trade

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Question 21

Multiple Choice

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The exchange rate between the Saudi riyal and the euro shifts from 5 riyal per euro to 4 riyal per euro. The riyal has _____, making Saudi exports _____ expensive.

A) appreciated; less
B) depreciated; less
C) appreciated; more
D) depreciated; more

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Question 22

Multiple Choice

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(Figure: Market for TVs 2) The world price of TVs is $500, and the government imposes a $100 tariff. According to the figure, domestic consumers purchase _____ units from domestic producers and _____ units from foreign producers after the tariff.

A) 60,000; 0
B) 40,000; 0
C) 60,000; 40,000
D) 40,000; 40,000

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Question 23

Multiple Choice

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The world supply curve slopes upward because, as the world price of a product falls:

Explain the sources of comparative advantage, and provide an example of each source.

Which of the following is MOST likely to be traded internationally?

(Figure: Imports and Exports) During the 2008 to 2009 financial crisis, exports as a share of GDP fell in the United States. Which of the following could explain this phenomenon?

(Figure: The Domestic Market for Sugar) Use Figure: The Domestic Market for Sugar. Assume that PA is the domestic equilibrium price without trade and that PW is the world price. Before international trade, consumer surplus is equal to the area:

Explain how importing goods and services leads to lower prices, less domestic production, and more domestic consumption.

Which of the following is a term economists use to explain why specific industries can become more efficient over time?

(Table: U.S. International Trade in Goods and Services, 2018, in millions of dollars. Details may not equal totals, due to seasonal adjustment and rounding.) From January to September in 2018, the United States was a net _____ of _____ million in goods.

Explain how importing goods and services decreases economic surplus for domestic producers.

The United Kingdom must give up the production of 300 motorcycles to produce 15 additional convertible Jaguars with the same resources. The opportunity cost of producing 100 motorcycles is _____ convertible Jaguar(s) .

South Korea must give up the production of 75 notebook computers to produce 25 additional cell phones. The opportunity cost of producing three notebook computers is _____ cell phone(s) .

In 2012, Marco Rubio argued that he would be in favor of getting rid of quotas on sugar imports (a trade barrier) only if the United States got something in return from Brazil. Rubio's argument is not economically sound (consistent with economic theory) for which of the following reasons?

Which of the following is a downside for country that reduces its barriers to trade?

In a single year, Germany can raise 100 tons of wheat or produce 1,000 boxes of daisies. In the same growing season, France can raise 50 tons of wheat or produce 750 boxes of daisies. In autarky, the opportunity cost of wheat:

If England can produce 300 tablets for every car it produces, and Brazil can produce 150 tablets for every car it produces, _____ has the _____ advantage in car production.

The United States has a comparative disadvantage in _____-skilled labor. This explains why the U.S. is a net _____ of high-skilled services.

Compared to a situation without trade, international trade leads to _____ domestic production in import-competing industries and _____ domestic production in exporting industries.

Which of the following is a source of comparative advantage?