ECON 101 QUIZ#14 GUIDE

Refer to Exhibit 34-7. The world price of good X is $15. Under a policy of free trade, U.S. consumers will import ___________ units of X from abroad.

A 50

A tariff is a tax on imports C

A tariff is a tax on imports C

Suppose that a tariff is imposed on imported cheese. This will have the effect of __________ the quantity consumed of cheese, __________ consumers' surplus, and __________ the government's tariff revenues.

B decreasing; decreasing; increasing

Refer to Exhibit 34-8. Assume that the current price of sugar in the United States is $300 per ton (which includes a $100 per ton tariff on sugar imports). The removal of the $100 per ton tariff would cause a(n) __________ in imports of __________ million tons.

B increase; 10

Refer to Exhibit 34-3. The world price is PW. If a tariff is imposed the price rises to PW + T. Because of the tariff, consumers' surplus is reduced by an amount equal to the area of

C 1 + 2 + 3 + 4.

Refer to Exhibit 34-9. For country Y, the opportunity cost of producing one unit of good B is __________ unit(s) of good A.

C 1.5

Refer to Exhibit 34-9. In the no specialization-no trade case, suppose country X produces and consumes 100 units of good A and 20 units of good B. Country Y produces and consumes 20 units of good A and 60 units of good B. If the two countries specialize and trade, and the actual amounts traded are 125 units of good A for 25 units of good B, how many more units of good A will country Y consume by specializing and trading?

D 105

A tariff on avocadoes ______________ the price of avocadoes, _____________ consumers' surplus for avocado buyers, _______________ producers' surplus of avocado growers and __________________ tariff revenue. Because the loss to _____________ is more than the gain to ___________________, there is a net loss to society.

D raises; decreases; increases; generates; consumers; producers and government

Which of the following statements is false?

Specialization and trade allow a country's inhabitants to consume at a level beyond its production possibilities frontier. E. none of the above Some of the goods the U.S. exports include cars, coal, and wheat. Some of the goods the U.S. imports include cars, oil, and coffee. A country has a comparative advantage in producing that good it can produce at lower opportunity cost than another country.

The difference between the amount a seller receives for a good and the lowest amount for which he would sell the good is called producers surplus A

The difference between the amount a seller receives for a good and the lowest amount for which he would sell the good is called producers surplus A

This guide is made to answer every economic quiz question. COMMANDS ARE : CTRL + F9 : (TYPE QUESTION)

This guide is made to answer every economic quiz question. COMMANDS ARE : CTRL + F9 : (TYPE QUESTION)