Learning: Chapter 18: International Trade and Public Policy

In the graphs shown, which country has a comparative advantage in the production of shirts?

Country B

What is the name given to the sale of a product for a price below its cost of production?

Dumping

The WTO determines that dumping has occurred if;

a product is exported for a lower price than it sells for in a home market.

The global trend towards large multinational firms is partially driven by __________.

comparative advantage

The use of trade barriers to shield domestic companies from foreign competition is called __________.

protectionism

Multinational corporations expanding into foreign markets often:

provide thousands of jobs for foreign nationals

A numerical limit on the quantity of a good that can be imported is a:

quota

The cost of saving jobs through trade barriers like tariffs and quotas is:

relatively high

A __________ is a negotiated agreement between two countries that limits the quantity of a specific product that may be imported into a country.

voluntary export restraint

An agreement negotiated between two countries that places a numerical limit on the quantity of a good that can be imported by one country from another country is known as a(n):

voluntary export restraint

According to the graph, what is the equilibrium price of lumber in the U.S. under autarky?

$3 per board foot

The opponents of globalization contend that:

globalization destroys cultures

According to the graph, what is the reduction in U.S. lumber consumption as a result of the tariff?

100,000 board feet

According to the graph, how many board feet of lumber will be imported if imports are allowed into the United States?

500,000

According to the graph, what quantity of domestic lumber will be supplied after a tariff of $0.50 per board foot is imposed?

900,000 board feet

Which of the following groups of people are opposed to the World Trade Organization (WTO)?

People who want to protect domestic firms

The sugar quota in the United States creates winners and losers. The winners are __________ and the losers are __________.

U.S. sugar producers, U.S. sugar consumers

The __________ is charged with overseeing and resolving international trade disputes involving information goods.

World Trade Organization

According to the graph how much domestic sugar will be supplied at the $0.12 price under free trade?

Zero pounds

A tax imposed by a government on imported products is called a:

tariff

Which of the following arguments is used to justify protectionism?

tariffs and quotas protect infant industries