econ six

Alpha can produce either 18 oranges or 9 apples an hour, while Beta can produce either 16 oranges or 4 apples an hour. Which of the following terms of trade between apples and oranges would allow both Alpha and Beta to gain by specialization and exchange?

1 apple for 3 oranges

The high-income economies of the world contain approximately __________ of the world's population and produce and consume ___________ of the World's GDP.

12%; over 60%

The membership of the WTO includes about __________ nations.

150

High income countries are classified as having a GDP per capita that is greater than

21556

Alternate Outputs from One Day's Labor Input: a) USA: 12 bushels of wheat or 3 yards of textiles, b) India: 3 bushels of wheat or 12 yards of textiles. The opportunity cost of one bushel of wheat in India is:

4 yards of textiles

As measured in 2008, about _________ of U.S. trade and ________ of European trade is intra-industry trade.

60%; 60%

The United States national minimum wage is _____________.

7.25

north america and the european union have about ______% of the world's population and their combined economic statistics show that they produce and consume about ______% of the worlds GDP

9,70

Which of the following is true?

A nation cannot have a comparative advantage in the production of every good.

Say that Alland can produce 32 units of food per person per year or 16 units of clothing per person per year, but Georgeland can produce 24 units of food per year or 12 units of clothing. Which of the following is true?

Alland has an absolute advantage in producing food but will not trade with Georgeland.

Suppose that Canada can produce 100,000 hockey sticks or 10,000 gallons of maple syrup in a typical workweek, while Germany can produce 90,000 hockey sticks or 10,000 gallons of maple syrup in a typical workweek. From these numbers, we can conclude:

Canada has a comparative advantage in the production of hockey sticks.

What are the arguments used to counter free (or freer trade).

Domestics jobs can be lost

Say that Alland can produce 32 units of food per person per year or 16 units of clothing per person per year, but Georgeland can produce 16 units of food per year or 8 units of clothing. Which of the following is true?

Georgeland has a comparative advantage, but not an absolute advantage, in producing clothing.

Say that Alland can produce 32 units of food per person per year or 16 units of clothing per person per year, but Georgeland can produce 24 units of food per year or 12 units of clothing. Which of the following is true?

Georgeland has an absolute disadvantage, but not a comparative disadvantage, in producing clothing.

In India one person can produce 330 pounds of rice or 110 shirts in one year. In China one person can produce 400 pounds of rice or 200 shirts in one year. Which of the following statements is true?

India has a comparative advantage in the production of rice.

Despite many negative feelings, a number of governments have decided that reducing barriers to trade is at least potentially beneficial to their economy. Which of the following is an example of countries reducing barriers through free trade?

NAFTA

It is sometimes argued that nation should not depend too heavily on other countries for supplies of certain key products. This argument is commonly known as the _______________.

National Interest Argument

________________________ are the result of improvements in human capital, physical capital, and technology interacting in a _____________________.

Productivity improvements; market-driven economy

The race to the bottom scenario of global environmental degradation is explained roughly like this:

Profit-seeking multinational companies shift their production from countries with strong environmental standards to countries with weak standards, thus reducing their costs and increasing their profits.

The international group responsible for lowering trade barriers is the:

World Trade Organization (WTO)

Politicians often argue for tariff increases in order to reduce the nation's dependence on imports. If tariffs are increased, the long-run effect is most likely to be:

a decrease in both American imports and exports.

Which of the following is the best example of a quota?

a limit imposed on the number of men's suits that can be imported from a foreign country

If the government legislates policies that block imports of solar panels and gives domestic manufacturers a $5 billion dollar tax subsidy, the benefits to the U.S. solar panel manufacturing and distribution industry will be very visible. The bearers of the cost of the tax subsidy:

are more anonymous.

As international trade increases, it contributes to a shift in jobs away from industries where that economy does not have a(n) __________ advantage and toward industries where it has a(n) ___________ advantage.

comparative; comparative

While governments will play a different role across countries, all the ________________ economies have found that increasing ____________________ for firms and workers has been a critical ingredient in the recipe for faster growth.

converging; market-oriented incentives

______ in high-income countries is caused by the economy being in a recession

cyclical unemployment

The infant industry argument for protectionism suggests that an industry must be protected in the early stages of its development so that:

domestic producers can attain the economies of scale to allow them to compete in world markets.

The u.s trade deficit can disappear without raising legitimate concerns over disruption to the economy if

domestic savings rates increases and foreign investment gradually decreases

A trade balance can be quickly defined as the gap between ______ which are also included in the current account balance along with _____

exports and imports; investment income and unilateral transfers

In 2010, many high-income countries will be focused on the short-term economic horizon due to aggressive and often controversial steps governments took to jump-start these economies out of severe recession. Considering the economic challenges that result from these policies, which of the following actions would be most advisable?

extricate themselves from the recession and the policies adopted in fighting that recession

Which of the following will have the greatest influence on shifting the aggregate supply curves of high-income countries to the right?

growth-oriented public policy

Alternate Outputs from One Day's Labor Input: 1. USA: 12 bushels of wheat or 3 yards of textiles, 2. India: 3 bushels of wheat or 12 yards of textiles. From the data, the USA

has an absolute advantage over India in the production of wheat.

Factors like health, education, human rights, crime, personal safety, and cleanliness of environment all

have a large impact on the standard of living of a country

Unemployment rates in the nations of Europe have typically been ______ than in the US

higher

A new American import quota on imported steel would be likely to:

increase American production of steel.

Import tariffs generally ________ the output of domestic producers of the affected products and also _________ the output of domestic exporters.

increase;decrease

An import quota does which of the following?

increases the price of the domestic goods to consumers

Tariffs and other trade restrictions increase the domestic scarcity of products from abroad. Such policies benefit domestic producers of the restricted products at the expense of domestic consumers.' This statement:

is essentially correct.

Intra-industry trade between similar trading partners allows the gains from ______________________ that arise when firms and workers specialize in the production of a certain product.

learning and innovation

Economists would say tariffs:

limit voluntary exchanges.

Countries have strong differences in economic institutions: the U.S. is extremely _________________, Cuba has a ________________ and Canada is a mixture of both.

market-oriented; command economy

The idea behind comparative advantage reflects the possibility that one party:

may be able to produce something at a lower opportunity cost than another party.

The slope of the production possibility frontier is determined by the ________________ of expanding production of one good, measured by how much of the other good would be lost.The

opportunity cost

Low-wage U.S. workers suffer from protectionism in all the industries that they don't work in, because:

protectionism forces them to pay higher prices for basic necessities like clothing and food.

There are nontariff barriers in the form of _______________ regulations, in which certain textiles are made in the United States, shipped to other countries, combined in making apparel with textiles made in those other countries--and then re-exported back to the United States at a lower tariff rate.

rules of origin

__________________________ address the problem of economic growth by continually striving for a more educated workforce that can create, invest in and apply new technologies.

technological leaders

Many high-income nations are approaching a situation in which:

the elderly will soon form a much larger share of the population.

The opportunity cost of producing a pair of pants in the USA is 5 bushels of wheat, while in China, it is 2 bushels of wheat. As a result:

there can be mutual gains from trade to the two countries if the USA exports wheat to China in exchange for pants.

When other factors such as health and illiteracy rates are added to global comparisons of GDP and population, which of the following is likely to be revealed?

very wide differences in the standard of living

In a number of middle to low-income economies around the world, governments may run an expansionary policy of huge and sustained budget deficits. This policy

will shift aggregate demand to the right, so that output is beyond the potential GDP level.

International trade is fundamentally a ________________________.

win-win situation