Question 1

Figure 9-20
The figure illustrates the market for rice in Vietnam. 
-Refer to Figure 9-20. From the figure it is apparent that

Accepted Answer

A)  Vietnam will experience a shortage of rice if trade is not allowed.
B)  Vietnam will experience a surplus of rice if trade is not allowed.
C)  Vietnam has a comparative advantage in producing rice, relative to the rest of the world.
D)  foreign countries have a comparative advantage in producing rice, relative to Vietnam.E) B) and D)
F) B) and C)

Question 2

Figure 9-13 
-Refer to Figure 9-13. Consumer surplus before trade is

Accepted Answer

A)  $1,600.
B)  $2,400.
C)  $3,200.
D)  $3,600.E) B) and D)
F) B) and C)

Question 3

Scenario 9-2
For a small country called Boxland, the equation of the domestic demand curve for cardboard is

QD=200−2PQ ^ { D } = 200 - 2 PQD=200−2P  ,
where  QDQ ^ { D }QD  represents the domestic quantity of cardboard demanded, in tons, and  PPP  represents the price of a ton of cardboard.For Boxland, the equation of the domestic supply curve for cardboard is

QS=−60+3PQ ^ { S } = - 60 + 3 PQS=−60+3P  ,
where  QsQ ^ { s }Qs  represents the domestic quantity of cardboard supplied, in tons, and  PPP  again represents the price of a ton of cardboard.
-Refer to Scenario 9-2. Suppose the world price of cardboard is $60. Then, if Boxland goes from prohibiting international trade in cardboard to allowing international trade in cardboard,

Accepted Answer

A)  domestic producers of cardboard become better off and domestic consumers of cardboard become better off.
B)  domestic producers of cardboard become better off and domestic consumers of cardboard become worse off.
C)  domestic producers of cardboard become worse off and domestic consumers of cardboard become better off.
D)  domestic producers of cardboard become worse off and domestic consumers of cardboard become worse off. E) C) and D)
F) A) and B)

Question 4

If the United States threatens to impose a tariff on Honduran blueberries if Honduras does not remove agricultural subsidies, the United States will be

Accepted Answer

A)  better off no matter how Honduras responds.
B)  better off if Honduras gives in, and will be no worse off if it doesn't.
C)  worse off if Honduras doesn't give in to the threat.
D)  worse off no matter how Honduras responds.E) C) and D)
F) B) and C)

Question 5

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) All of the above
F) A) and B)

Question 6

Figure 9-18. On the diagram below, Q represents the quantity of peaches and P represents the price of peaches. The domestic country is Isoland. 
-Refer to Figure 9-18. Suppose Isoland changes from a no-trade policy to a policy that allows international trade. If the world price of peaches is $3, then the policy change results in a

Accepted Answer

A)  $15.00 decrease in producer surplus.
B)  $45.00 increase in consumer surplus.
C)  $20.00 increase in total surplus.
D)  $12.50 increase in total surplus.E) A) and D)
F) C) and D)

Question 7

Suppose the Ivory Coast, a small country, imports wheat at the world price of $4 per bushel. If the Ivory Coast imposes a tariff of $1 per bushel on imported wheat, then, other things equal, the price of wheat in Ivory Coast will increase, but by less than $1.

Accepted Answer

A) True 
 B)False

Question 8

Figure 9-18. On the diagram below, Q represents the quantity of peaches and P represents the price of peaches. The domestic country is Isoland. 
-Refer to Figure 9-18. If Isoland allows international trade and if the world price of peaches is $5, then

Accepted Answer

A)  Isoland has a comparative advantage, relative to other countries, in producing peaches.
B)  Isoland will import peaches.
C)  consumer surplus with trade exceeds consumer surplus without trade.
D)  All of the above are correct.E) B) and C)
F) A) and D)

Question 9

The nation of Aviana soon will abandon its no-trade policy and adopt a free-trade policy. If the world price of goose meat is $3 per pound and the domestic price of goose meat without trade is $2 per pound, then Aviana should export goose meat.

Accepted Answer

A) True 
 B)False

Question 10

Figure 9-7. The figure applies to the nation of Wales and the good is cheese. 2 - Q1 units of cheese. B) exports Q2 - Q1 units of cheese. C) imports Q2 - Q0 units of cheese. D) exports Q2 - Q0 units of cheese." class="answers-bank-image d-inline" rel="preload" >
-Refer to Figure 9-7. With trade, Wales

Accepted Answer

A)  imports Q2 - Q1 units of cheese.
B)  exports Q2 - Q1 units of cheese.
C)  imports Q2 - Q0 units of cheese.
D)  exports Q2 - Q0 units of cheese.E) None of the above
F) A) and D)

Question 11

When a country abandons a no-trade policy, adopts a free-trade policy, and becomes an exporter of a particular good,

Accepted Answer

A)  producer surplus increases and total surplus increases in the market for that good.
B)  producer surplus increases and total surplus decreases in the market for that good.
C)  producer surplus decreases and total surplus increases in the market for that good.
D)  producer surplus decreases and total surplus decreases in the market for that good.E) None of the above
F) A) and B)

Question 12

The United States has imposed taxes on some imported goods that have been sold here by foreign countries at below their cost of production. These taxes

Accepted Answer

A)  benefit the United States as a whole, because they generate revenue for the government. In addition, because the goods are priced below cost, the taxes do not harm domestic consumers.
B)  benefit the United States as a whole, because they generate revenue for the government and increase producer surplus.
C)  harm the United States as a whole, because they reduce consumer surplus by an amount that exceeds the gain in producer surplus and government revenue.
D)  harm the United States as a whole, because they reduce producer surplus by an amount that exceeds the gain in consumer surplus and government revenue.E) All of the above
F) C) and D)

Question 13

Figure 9-18. On the diagram below, Q represents the quantity of peaches and P represents the price of peaches. The domestic country is Isoland. 
-Refer to Figure 9-18. If Isoland allows international trade, then it will be an exporter of peaches if and only if the world price of peaches is

Accepted Answer

A)  above $2.
B)  below $4.
C)  above $4.
D)  below $7.E) C) and D)
F) A) and C)

Question 14

The nation of Fastbrooke forbids international trade. In Fastbrooke, you can exchange 1 television for 3 computers. In other countries, you can exchange 1 television for 2 computers. These facts indicate that

Accepted Answer

A)  other countries have an absolute advantage, relative to Fastbrooke, in producing televisions.
B)  Fastbrooke has a comparative advantage, relative to other countries, in producing televisions.
C)  if Fastbrooke were to allow trade, it would import computers.
D)  the world price of computers exceeds the price of computers in Fastbrooke.E) A) and D)
F) All of the above

Question 15

One should be especially wary of the national-security argument for restricting trade when that argument is made by

Accepted Answer

A)  representatives of industry.
B)  representatives of the defense establishment.
C)  members of households.
D)  foreign government officials.E) None of the above
F) A) and B)

Question 16

Figure 9-1
The figure illustrates the market for wool in Scotland. 
-Refer to Figure 9-1. Relative to the no-trade situation, trade with the rest of the world results in

Accepted Answer

A)  Scotland consumers paying a higher price for wool.
B)  a decrease in producer surplus in Scotland.
C)  a decrease in total surplus in Scotland.
D)  All of the above are correct.E) B) and C)
F) A) and D)

Question 17

Figure 9-7. The figure applies to the nation of Wales and the good is cheese. 1 and Q2. B) P1 and Q1. C) P0 and Q0. D) P0 and Q1." class="answers-bank-image d-inline" rel="preload" >
-Refer to Figure 9-7. The equilibrium price and the equilibrium quantity of cheese in Wales before trade are

Accepted Answer

A)  P1 and Q2.
B)  P1 and Q1.
C)  P0 and Q0.
D)  P0 and Q1.E) None of the above
F) B) and D)

Question 18

A multilateral approach to free trade has greater potential to increase the gains from trade than a unilateral approach, because the multilateral approach can reduce trade restrictions abroad as well as at home.

Accepted Answer

A) True 
 B)False

Question 19

Figure 9-18. On the diagram below, Q represents the quantity of peaches and P represents the price of peaches. The domestic country is Isoland. 
-Refer to Figure 9-18. If Isoland allows international trade and if the world price of peaches is $3, then

Accepted Answer

A)  Isoland has a comparative advantage, relative to other countries, in producing peaches.
B)  Isoland will export peaches.
C)  producer surplus with trade exceeds producer surplus without trade.
D)  consumer surplus with trade exceeds consumer surplus without trade.E) A) and B)
F) A) and C)

Question 20

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

Accepted Answer

A)  everyone in the country benefits.
B)  the gains of the winners exceed the losses of the losers.
C)  the losses of the losers exceed the gains of the winners.
D)  everyone in the country loses.E) A) and C)
F) A) and B)

Exam 9: Application: International Trade

Figure 9-13 -Refer to Figure 9-13. Consumer surplus before trade is

Correct Answer
verified

When a country abandons a no-trade policy, adopts a free-trade policy, and becomes an exporter of a particular good,

Correct Answer
verified

Suppose the Ivory Coast, a small country, imports wheat at the world price of $4 per bushel. If the Ivory Coast imposes a tariff of $1 per bushel on imported wheat, then, other things equal, the price of wheat in Ivory Coast will increase, but by less than $1.

Correct Answer
verified

If the United States threatens to impose a tariff on Honduran blueberries if Honduras does not remove agricultural subsidies, the United States will be

Correct Answer
verified

Figure 9-18. On the diagram below, Q represents the quantity of peaches and P represents the price of peaches. The domestic country is Isoland. -Refer to Figure 9-18. If Isoland allows international trade and if the world price of peaches is $5, then

Correct Answer
verified

The nation of Aviana soon will abandon its no-trade policy and adopt a free-trade policy. If the world price of goose meat is $3 per pound and the domestic price of goose meat without trade is $2 per pound, then Aviana should export goose meat.

Correct Answer
verified

The nation of Fastbrooke forbids international trade. In Fastbrooke, you can exchange 1 television for 3 computers. In other countries, you can exchange 1 television for 2 computers. These facts indicate that

Correct Answer
verified

Figure 9-18. On the diagram below, Q represents the quantity of peaches and P represents the price of peaches. The domestic country is Isoland. -Refer to Figure 9-18. If Isoland allows international trade and if the world price of peaches is $3, then

Correct Answer
verified

One should be especially wary of the national-security argument for restricting trade when that argument is made by

Correct Answer
verified

Correct Answer
verified

Figure 9-7. The figure applies to the nation of Wales and the good is cheese. -Refer to Figure 9-7. The equilibrium price and the equilibrium quantity of cheese in Wales before trade are

Correct Answer
verified

Figure 9-18. On the diagram below, Q represents the quantity of peaches and P represents the price of peaches. The domestic country is Isoland. -Refer to Figure 9-18. If Isoland allows international trade, then it will be an exporter of peaches if and only if the world price of peaches is

Correct Answer
verified

Correct Answer
verified

Figure 9-7. The figure applies to the nation of Wales and the good is cheese. -Refer to Figure 9-7. With trade, Wales

Correct Answer
verified

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

Correct Answer
verified

Figure 9-1 The figure illustrates the market for wool in Scotland. -Refer to Figure 9-1. Relative to the no-trade situation, trade with the rest of the world results in

Correct Answer
verified

Figure 9-20 The figure illustrates the market for rice in Vietnam. -Refer to Figure 9-20. From the figure it is apparent that

Correct Answer
verified

A multilateral approach to free trade has greater potential to increase the gains from trade than a unilateral approach, because the multilateral approach can reduce trade restrictions abroad as well as at home.

Correct Answer
verified

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

Correct Answer
verified

The United States has imposed taxes on some imported goods that have been sold here by foreign countries at below their cost of production. These taxes

Correct Answer
verified

Exam 9: Application: International Trade

Figure 9-13 -Refer to Figure 9-13. Consumer surplus before trade is

Correct AnswerverifiedShow Answer

When a country abandons a no-trade policy, adopts a free-trade policy, and becomes an exporter of a particular good,

Correct AnswerverifiedShow Answer

Suppose the Ivory Coast, a small country, imports wheat at the world price of $4 per bushel. If the Ivory Coast imposes a tariff of $1 per bushel on imported wheat, then, other things equal, the price of wheat in Ivory Coast will increase, but by less than $1.

Correct AnswerverifiedShow Answer

If the United States threatens to impose a tariff on Honduran blueberries if Honduras does not remove agricultural subsidies, the United States will be

Correct AnswerverifiedShow Answer

Figure 9-18. On the diagram below, Q represents the quantity of peaches and P represents the price of peaches. The domestic country is Isoland. -Refer to Figure 9-18. If Isoland allows international trade and if the world price of peaches is $5, then

Correct AnswerverifiedShow Answer

The nation of Aviana soon will abandon its no-trade policy and adopt a free-trade policy. If the world price of goose meat is $3 per pound and the domestic price of goose meat without trade is $2 per pound, then Aviana should export goose meat.

Correct AnswerverifiedShow Answer

The nation of Fastbrooke forbids international trade. In Fastbrooke, you can exchange 1 television for 3 computers. In other countries, you can exchange 1 television for 2 computers. These facts indicate that

Correct AnswerverifiedShow Answer

Figure 9-18. On the diagram below, Q represents the quantity of peaches and P represents the price of peaches. The domestic country is Isoland. -Refer to Figure 9-18. If Isoland allows international trade and if the world price of peaches is $3, then

Correct AnswerverifiedShow Answer

One should be especially wary of the national-security argument for restricting trade when that argument is made by

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Figure 9-7. The figure applies to the nation of Wales and the good is cheese. -Refer to Figure 9-7. The equilibrium price and the equilibrium quantity of cheese in Wales before trade are

Correct AnswerverifiedShow Answer

Figure 9-18. On the diagram below, Q represents the quantity of peaches and P represents the price of peaches. The domestic country is Isoland. -Refer to Figure 9-18. If Isoland allows international trade, then it will be an exporter of peaches if and only if the world price of peaches is

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Figure 9-7. The figure applies to the nation of Wales and the good is cheese. -Refer to Figure 9-7. With trade, Wales

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Figure 9-1 The figure illustrates the market for wool in Scotland. -Refer to Figure 9-1. Relative to the no-trade situation, trade with the rest of the world results in

Correct AnswerverifiedShow Answer

Figure 9-20 The figure illustrates the market for rice in Vietnam. -Refer to Figure 9-20. From the figure it is apparent that

Correct AnswerverifiedShow Answer

A multilateral approach to free trade has greater potential to increase the gains from trade than a unilateral approach, because the multilateral approach can reduce trade restrictions abroad as well as at home.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

The United States has imposed taxes on some imported goods that have been sold here by foreign countries at below their cost of production. These taxes

Correct AnswerverifiedShow Answer

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