Trade Homework

A linear PPC would show __________ costs ​, and a PPC that is curved away from the origin would show __________ costs .

constant opportunity, increasing opportunity

Dominic is willing to pay​ $12 for a single​ pizza; Stephany is willing to pay​ $7; and Tyler is willing to pay​ $5. There are no other potential consumers for pizza.​ Cheezbuzz, the supplier of​ pizza, has a cost of​ $1 for the first​ pizza, $2 for the second​ pizza, $3 for the​ third, $4 for the​ fourth, and so on. Part 2 In a closed market​ equilibrium, the social surplus will be​ $_____. Part 3 If the world price is​ $10.50, a total of ___ pizzas will be exported. Part 4 If the world price is​ $2.50, the social surplus will be ​$______. ​(Round your response to the nearest​ penny.)

18, 9, 18.50

All of the following shift the Production Possibilities Curve outward​ except: A. new competitors in the marketplace. B. increases in worker education. C. increases in natural resources. D. changes in productivity growth due to population growth.

A

On the Production Possibilities​ Curve, possible production levels are​ represented: A. at any point on or below the curve. B. at any point on the curve. C. at any point above the curve. D. at any point below the curve.

A

What are the types of goods that are causing the shift in the balance of imports and exports in the United​ States? A. Services have been the primary driver in the shift in the balance of imports and exports in the United States. B. Manufactured goods have played an important role in the​ shift, even though the number of manufactured goods has increased. C. The significant increase in oil exports has played an important role in the shift. D. Manufactured goods have played an important role in the​ shift, as the number of manufactured goods produced has declined.

B

Terms of trade is the​ ____________. A. legal document that trading partners sign. B. time required to produce a good or service that is traded. C. benefit received from trade. D. exchange rate of goods for goods.

D

When a country engages in free​ trade, the​ "winners" can compensate the​ "losers." Part 2 Which of the following is a valid reason government cannot or should not compensate the​ "losers" of free​ trade? A. Free trade always creates job opportunities in new industries so​ "losers" can immediately go out and get new jobs. B. ​"Winners" are not responsible for the effects of their comparative advantage and​ shouldn't be forced to compensate the​ "losers". C. It is difficult to pinpoint who the losers are and how much each lost. D. Free trade is not​ "fair trade." The government has no obligation to compensate the​ "losers".

C

Absolute advantage is the ability of an​ individual, firm, or country to​ produce: A. a certain good at a lower opportunity cost than other producers. B. a certain good at a lower total cost than other producers. C. more of a certain good than other competing​ producers, given the same number of resources. D. more of a certain good than other competing​ producers, given more resources

C

How has the pattern of trade changed in the United States since​ 1960? A. Exports have grown faster than​ imports, and the United States has remained a net exporter. B. Exports have grown faster than​ imports, and the United States has become a net importer. C. Imports have grown faster than​ exports, and the United States has become a net importer. D. Imports have grown faster than​ exports, and the United States has remained a net exporter. E. Exports and imports have grown at the same​ rate, and the United States has remained a net exporter.

C

One reason a country might seek to implement protectionist policies could be​ to: A. increase exports. B. participate in foreign trade and investment. C. maintain its​ culture's uniqueness. D. increase imports to satisfy domestic demand.

C

Terms of trade are determined​ ____________. A. by buyers. B. by sellers. C. on the basis of opportunity costs. D. on the basis of absolute advantage.

C

A production possibilities curve​ (PPC) ___________. A. determines the levels of imports and exports within a country. B. shows the combinations of inputs that can create a specific level of output. C. shows the​ trade-off between price and quantity of produced goods or services. D. shows the relationship between the maximum production of one good for a given level of production of another good.

D

All of the following are factors that contribute to a​ country's comparative advantage​ except: A. technology. B. climate. C. natural resources. D. aging population.

D

What is the problem with the argument that infant industries need to be protected from foreign​ competition? A. Foreign companies may do a better job of providing the good or service. B. Changing a comparative advantage is nearly impossible and so the domestic industry will not likely survive anyway. C. Since the stock of deadweight losses builds up over​ time, the total lost surplus will never be made up. D. Starting a company in isolation may deprive it of​ "technological spillovers" that its​ competitors, all located near one​ another, may enjoy. E. Because the world price will continue to​ drop, the domestic industry will never catch up in any case.

D

Which of the following is not a source of a country's comparative advantage? A. Climate B. Relative abundance of labor and capital C. Technology D. Quotas

D

California wine that is sold in New Jersey is an ______ for California and an _______ for New Jersey. Part 2 You take a vacation in​ Paris, France. Your vacation is an ______for the United States and an _______ for France. Part 3 A construction company in China buys tractors from​ Caterpillar, which is based in Illinois. The tractors are an ______ for China and an ______ for Illinois. Part 4 You go to your doctor in​ Cincinnati, Ohio, and she takes an​ x-ray of your broken arm. The​ x-ray is read by a technician in​ Mumbai, India, and he sends a report via email to your doctor. The reading is an ______ for India and an ______ for the United States.

export, import import , export import , export export, import

If a country had exports of ​$340 billion and imports of ​$120 ​billion, they would be considered a net (exporter, importer) .

exporter

If the domestic price for a good is lower than the world price when a country opens itself to​ trade, domestic suppliers will (increase, decrease) the price of the​ good, which in turn will (increase, decrease) the domestic demand for the good.

increase, decrease