Question # 1

Similar to import tariffs import quotas tend to result in.

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Higher prices ad reduced imports

Increased government revenue

Increases consumer surplus

Decreased producer surplus

A feasible effect of international trade is that a

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Monopoly in the home market become an oligopoly in the world market

Oligopoly in the home market becomes a monopoly in the world market

Purely competitive firm in the home market becomes an oligopolistic

Purely competitive firm in the home market becomes a monopolist

The exchange rate is kept the same across geographically separate markets by

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Hedging

Speculation

Government regulation

Arbitrage

A depreciation of the dollar willhave its most pronounced impact on imports if the demand for imports is.

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Constant

Inelastic

Elastic

Unitary elastic

In balance of payments accounting tourism and travel are classified in the

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Merchandise trade account

Services account

Unilateral transfers account

Capital account

__________ policies attempt to foster industrialization by establishing high barriers to import of foreign goods to promote local production.

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absolute advantage

Comparative advantage

Export led growth

Import substitution

Poor developing countries typically impose ______ tariffs than rich advanced nations on imports.

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Lower

Higher

About the same height

None of the above

___________ are quotas that lead to a complete abolishment of trade.

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Nontariff barriers

Embargoes

Voluntary export restraints

Orderly marketing agreements

The difference between a country's balances of payments and its balance of international indebtedness.

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Is equal of official reserve transactions

Occurs because of foreign exchange fluctuations

Reflects statistical discrepancies

Reflects the difference between flow and stock concepts

In the classical model of Ricardo the direction of trade is determined by

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Absolute advantage

Comparative advantage

Physical advantage

Which way the wind blows

The result of antidumping tariffs is to.

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increase consumer surplus in the importing country

Decrease producer surplus in the importing country

Impose a price floor on foreign prices in the importing country

Impose a price celling on foreign prices in the importing county

Those who argue in favor of import protection generally give the impression that such restricted trade will.

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Decrease the level of national security

Provide benefits to some particular industry

Provide benefits to the entire nation

Not yield welfare losses for the nation

Which financial instruments provide a buyer the right to purchase or sell a fixed amount of currency at a prearranged price within a few days to a coupled of years.

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Letter of credit

Foreign currency option

Cable transfer

Bill of exchange

All of the following are trade problems of developing countries except.

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Unstable export markets

improving terms of trade

Limited access to the markets of industrial countries

Highly elastic demand curves for their products.

A country that is a net international debtor initially experiences a.

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Larger savings pool available finance domestic spending

Higher interest rate which leads lower domestic investment.

Loss of funds to trading partners overseas

Decrease in tis services exports to other countire.

The world trade organization is sometimes criticized for all of the following reasons except.

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If reduces the sovereignty of member countries.

Favors free trade over the quality of the environment

It has no way to solve trade disputes among member countries.

It is a "puppet" of multinational corporations

Most tariffs have

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Only revenue effects

Only protective effects

Both protective ad revenue effects

Neither protective or revenue effects

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

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Domestic subsidy

Export subsidy

Import quota

Export quota

The arrangement where goods imported from trading partners in the developing world are subject to lower tariff rates than goods from other countries is referred to as.

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Normal trade relation status

Most favored nation status

Generalized system of preferences

increase foreign competition tend to.

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Intensify inflationary pressure at home

Induce falling output per worker hour for domestic workers

Place constraints on the wages of domestic workers

Increase profits of domestic import competing industries.

Comparative advantage is determined by

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Actual difference in labor productivity between countries.

Relative difference in labor productivity between countries.

Both a and b

Neither a nor b

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