Question 1

Figure 9-26
The following diagram shows the domestic demand and domestic supply curves in a market. 
-Refer to Figure 9-26. With no trade allowed, what are the equilibrium price and equilibrium quantity in this market?

Accepted Answer

The equilibrium pric...

Question 2

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 much are consumer surplus and producer surplus?

Accepted Answer

With trade and a tar...

Question 3

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

Accepted Answer

A)  Mexico has a comparative advantage over other countries and Mexico will export beets.
B)  Mexico has a comparative advantage over other countries and Mexico will import beets.
C)  other countries have a comparative advantage over Mexico and Mexico will export beets.
D)  other countries have a comparative advantage over Mexico and Mexico will import beets.E) None of the above
F) B) and D)

Question 4

Figure 9-8. On the diagram below, Q represents the quantity of cars and P represents the price of cars. 
-Refer to Figure 9-8. When the country for which the figure is drawn allows international trade in cars,

Accepted Answer

A)  consumer surplus increases by the area B.
B)  producer surplus decreases by the area B + D.
C)  total surplus increases by the area D.
D)  All of the above are correct.E) A) and C)
F) A) and D)

Question 5

In analyzing the gains and losses from international trade, to say that Moldova is a small country is to say that

Accepted Answer

A)  Moldova can only import goods; it cannot export goods.
B)  Moldova's choice of which goods to export and which goods to import is not based on the principle of comparative advantage.
C)  only the domestic price of a good is relevant for Moldova; the world price of a good is irrelevant.
D)  Moldova is a price taker.E) B) and C)
F) A) and D)

Question 6

The world price of a pound of almonds is $4.50. Before Uruguay allowed trade in almonds, the price of a pound of almonds there was $3.00. Once Uruguay began allowing trade in almonds with other countries, Uruguay began

Accepted Answer

A)  exporting almonds and the price per pound in Uruguay remained at $3.00.
B)  exporting almonds and the price per pound in Uruguay increased to $4.50.
C)  importing almonds and the price per pound in Uruguay remained at $3.00.
D)  importing almonds and the price per pound in Uruguay increased to $4.50.E) A) and B)
F) All of the above

Question 7

Figure 9-14. On the diagram below, Q represents the quantity of crude oil and P represents the price of crude oil. 
-Refer to Figure 9-14. When the country for which the figure is drawn allows international trade in crude oil,

Accepted Answer

A)  consumer surplus for domestic crude-oil consumers decreases.
B)  the demand for crude oil by domestic crude-oil consumers decreases.
C)  the losses of the domestic losers outweigh the gains of the domestic winners.
D)  domestic crude-oil producers sell less crude oil.E) None of the above
F) B) and C)

Question 8

Figure 9-5
The figure illustrates the market for tricycles in a country. 
-Refer to Figure 9-5. If this country allows free trade in tricycles,

Accepted Answer

A)  consumers will gain and producers will lose.
B)  consumers will lose and producers will gain.
C)  both consumers and producers will gain.
D)  both consumers and producers will lose.E) A) and C)
F) A) and B)

Question 9

If the world price of coffee is lower than Colombia's domestic price of coffee without trade, then Colombia

Accepted Answer

A)  should import coffee.
B)  has a comparative advantage in coffee.
C)  should produce just enough coffee to satisfy domestic demand.
D)  should produce no coffee domestically.E) B) and C)
F) A) and B)

Question 10

Figure 9-17 
-Refer to Figure 9-17. When the country moves from free trade to trade and a tariff, consumer surplus

Accepted Answer

A)  decreases by $576 and producer surplus does not change.
B)  decreases by $576 and producer surplus increases by $192.
C)  decreases by $792 and producer surplus does not change.
D)  decreases by $792 and producer surplus increases by $192.E) A) and B)
F) A) and C)

Question 11

Economists agree that trade ought to be restricted if free trade means that domestic jobs might be lost because of foreign competition.

Accepted Answer

A) True 
 B)False

Question 12

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...

Question 13

Figure 9-9 
-Refer to Figure 9-9. Producer surplus in this market before trade is

Accepted Answer

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

Question 14

Figure 9-5
The figure illustrates the market for tricycles in a country. 
-Refer to Figure 9-5. Without trade, producer surplus amounts to

Accepted Answer

A)  $810.
B)  $1,620.
C)  $3,240.
D)  $6,480.E) A) and B)
F) C) and D)

Question 15

When a country moves away from a free trade position and imposes a tariff on imports, it causes

Accepted Answer

A)  a decrease in total surplus in the market.
B)  a decrease in producer surplus in the market.
C)  an increase in consumer surplus in the market.
D)  a decrease in revenue to the government.E) None of the above
F) B) and D)

Question 16

Domestic producers of a good become better off, and domestic consumers of a good become worse off, when a country begins allowing international trade in that good and

Accepted Answer

A)  the country becomes an importer of the good as a result.
B)  the world price exceeds the domestic price of the good that prevailed before international trade was allowed.
C)  other countries have a comparative advantage, relative to the country in question, in producing the good.
D)  total surplus does not change as a result.E) None of the above
F) A) and D)

Question 17

The nation of Wheatland forbids international trade. In Wheatland, you can buy 1 pound of corn for 3 pounds of fish. In other countries, you can buy 1 pound of corn for 2 pounds of fish. These facts indicate that

Accepted Answer

A)  Wheatland has a comparative advantage, relative to other countries, in producing corn.
B)  other countries have a comparative advantage, relative to Wheatland, in producing fish.
C)  the price of fish in Wheatland exceeds the world price of fish.
D)  if Wheatland were to allow trade, it would import corn.E) A) and D)
F) B) and C)

Question 18

Suppose in the country of Nash that the price of corn is $4 per bushel with no trade allowed. If the world price of corn is $3 per bushel and if Nash allows free trade, will Nash be an importer or an exporter of corn?

Accepted Answer

Nash will ...

Question 19

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 20

List four benefits of international trade.

Accepted Answer

Increased variety of goods; lo...

Exam 9: Application: International Trade

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

List four benefits of international trade.

Correct Answer
verified
Increased variety of goods; lo...
View Answer

Suppose in the country of Nash that the price of corn is $4 per bushel with no trade allowed. If the world price of corn is $3 per bushel and if Nash allows free trade, will Nash be an importer or an exporter of corn?

Correct Answer
verified
Nash will ...
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Figure 9-17 -Refer to Figure 9-17. When the country moves from free trade to trade and a tariff, consumer surplus

Correct Answer
verified

Figure 9-5 The figure illustrates the market for tricycles in a country. -Refer to Figure 9-5. If this country allows free trade in tricycles,

Correct Answer
verified

Economists agree that trade ought to be restricted if free trade means that domestic jobs might be lost because of foreign competition.

Correct Answer
verified

If the world price of coffee is lower than Colombia's domestic price of coffee without trade, then Colombia

Correct Answer
verified

Figure 9-5 The figure illustrates the market for tricycles in a country. -Refer to Figure 9-5. Without trade, producer surplus amounts to

Correct Answer
verified

Domestic producers of a good become better off, and domestic consumers of a good become worse off, when a country begins allowing international trade in that good and

Correct Answer
verified

When a country moves away from a free trade position and imposes a tariff on imports, it causes

Correct Answer
verified

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

Correct Answer
verified

The world price of a pound of almonds is $4.50. Before Uruguay allowed trade in almonds, the price of a pound of almonds there was $3.00. Once Uruguay began allowing trade in almonds with other countries, Uruguay began

Correct Answer
verified

Correct Answer
verified
With trade and a tar...
View Answer

Figure 9-8. On the diagram below, Q represents the quantity of cars and P represents the price of cars. -Refer to Figure 9-8. When the country for which the figure is drawn allows international trade in cars,

Correct Answer
verified

In analyzing the gains and losses from international trade, to say that Moldova is a small country is to say that

Correct Answer
verified

Figure 9-14. On the diagram below, Q represents the quantity of crude oil and P represents the price of crude oil. -Refer to Figure 9-14. When the country for which the figure is drawn allows international trade in crude oil,

Correct Answer
verified

The nation of Wheatland forbids international trade. In Wheatland, you can buy 1 pound of corn for 3 pounds of fish. In other countries, you can buy 1 pound of corn for 2 pounds of fish. These facts indicate that

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

Figure 9-9 -Refer to Figure 9-9. Producer surplus in this market before trade is

Correct Answer
verified

Figure 9-26 The following diagram shows the domestic demand and domestic supply curves in a market. -Refer to Figure 9-26. With no trade allowed, what are the equilibrium price and equilibrium quantity in this market?

Correct Answer
verified
The equilibrium pric...
View Answer

Exam 9: Application: International Trade

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

List four benefits of international trade.

Correct AnswerverifiedIncreased variety of goods; lo...View AnswerShow Answer

Suppose in the country of Nash that the price of corn is $4 per bushel with no trade allowed. If the world price of corn is $3 per bushel and if Nash allows free trade, will Nash be an importer or an exporter of corn?

Correct AnswerverifiedNash will ...View AnswerShow Answer

Figure 9-17 -Refer to Figure 9-17. When the country moves from free trade to trade and a tariff, consumer surplus

Correct AnswerverifiedShow Answer

Figure 9-5 The figure illustrates the market for tricycles in a country. -Refer to Figure 9-5. If this country allows free trade in tricycles,

Correct AnswerverifiedShow Answer

Economists agree that trade ought to be restricted if free trade means that domestic jobs might be lost because of foreign competition.

Correct AnswerverifiedShow Answer

If the world price of coffee is lower than Colombia's domestic price of coffee without trade, then Colombia

Correct AnswerverifiedShow Answer

Figure 9-5 The figure illustrates the market for tricycles in a country. -Refer to Figure 9-5. Without trade, producer surplus amounts to

Correct AnswerverifiedShow Answer

Domestic producers of a good become better off, and domestic consumers of a good become worse off, when a country begins allowing international trade in that good and

Correct AnswerverifiedShow Answer

When a country moves away from a free trade position and imposes a tariff on imports, it causes

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

The world price of a pound of almonds is $4.50. Before Uruguay allowed trade in almonds, the price of a pound of almonds there was $3.00. Once Uruguay began allowing trade in almonds with other countries, Uruguay began

Correct AnswerverifiedShow Answer

Correct AnswerverifiedWith trade and a tar...View AnswerShow Answer

Figure 9-8. On the diagram below, Q represents the quantity of cars and P represents the price of cars. -Refer to Figure 9-8. When the country for which the figure is drawn allows international trade in cars,

Correct AnswerverifiedShow Answer

In analyzing the gains and losses from international trade, to say that Moldova is a small country is to say that

Correct AnswerverifiedShow Answer

Figure 9-14. On the diagram below, Q represents the quantity of crude oil and P represents the price of crude oil. -Refer to Figure 9-14. When the country for which the figure is drawn allows international trade in crude oil,

Correct AnswerverifiedShow Answer

The nation of Wheatland forbids international trade. In Wheatland, you can buy 1 pound of corn for 3 pounds of fish. In other countries, you can buy 1 pound of corn for 2 pounds of fish. These facts indicate that

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

Figure 9-9 -Refer to Figure 9-9. Producer surplus in this market before trade is

Correct AnswerverifiedShow Answer

Figure 9-26 The following diagram shows the domestic demand and domestic supply curves in a market. -Refer to Figure 9-26. With no trade allowed, what are the equilibrium price and equilibrium quantity in this market?

Correct AnswerverifiedThe equilibrium pric...View AnswerShow Answer

Correct Answer
verified
With trade and a tariff, domes...
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Correct Answer
verified
Increased variety of goods; lo...
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Correct Answer
verified
Nash will ...
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Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
verified

Correct Answer
verified
With trade and a tar...
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Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The equilibrium pric...
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Correct Answer
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Correct Answer
verified
The equilibrium pric...
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