EC 111 Chapter 19 Homework

Only in services

The United States exports more than it imports ___________________________.

United States

A World View article titled "Export Ratios" examines the openness of trade for several countries based on the trade to GDP ratio, what country exports the least?

Consumption outside the production possibilities curve for both countries

If the terms of trade between any two countries lie somewhere between their respective opportunity costs, then the effects of trade will include _________________________________.

Other countries, such as China, can produce t shirts at a lower opportunity cost relative to the United States

The United States has an absolute advantage in producing t shirts, but not a comparative advantage, because ___________________________________________.

Greater efficiency in the use of the world's limited resources

The benefits from international trade include ___________________________________________.

Redistributes income from import-competing industries to export industries

International trade __________________________________.

Opportunity costs increase as more of a good is produced

It is not likely that a country will specialize completely in one good even if it has a lower opportunity cost because ________________________________.

Protectionism in the paper product market but free trade in the lumber market

Producers of paper products are most likely to be in favor of ___________________________________________.

1/2 and 2/3 of an HDTV per ton of paper

Suppose Canada can produce either 300 tons of paper or 200 HDTVs, and India can produce either 200 tons of paper or 100 HDTVs. The terms of trade between the two countries will lie between _____________________________________________.

The opportunity cost for both countries is the same

Two countries will have zero incentive to trade if their production possibilities curves are parallel straight lines because ___________________________________________.

They will be able to consume more goods in total due to specialization and trade

Two countries with differing comparative advantages may engage in trade because ________________________________________.

Higher prices for the import-competing goods

When a country imposes tariffs, it is likely to cause ________________________________.

Reduce barriers to trade

A principal objective to the World Trade Organization is to _________________________________.

A limit on the quantity of a good that may be imported

A quota is _______________________________________.

A voluntary restraint agreement

An agreement to reduce the volume of trade in a specific good is ________________________________________.

US sugar quotas raise the price of sugar in the United States and are above world prices

Gary Galles in the article "End the Import Quotas on Sugar" argues that _____________________________________________.

Imports

Goods an services purchased from international sources are _________________.

An open economy

If a country engages in trade with other countries, it is known as _____________________________.

Its consumption possibilities equal its production possibilities

If a country is completely self-reliant in producing goods for its own consumption needs, then ________________________________.

Retaliatory tariffs

If exports are being excluded unfairly from a market, the World Trade Organization may authorize _________________________.

Every good exported by one country becomes an import for another country

In terms of the world as a whole, imports must equal exports because _______________________________.

Protect US-based-import competing industries

In the World View article on new tariffs on imported tires from China, the tariff is designed to _______________________________.

Accelerated economic growth and reduced inflationary pressures in Canada, Mexico, and the United States

Overall, NAFTA has resulted in ____________________________________.

Both an absolute and comparative advantage in DVD players

Suppose China can produce either 600 telephones or 400 DVD players, and Japan can produce either 400 telephones or 200 DVD players. Implicitly, China has _____________________________________.

Specialization according to comparative advantage

The expansion of world output as a result of trade is mainly due to the effects of ___________________________________________.

Concern about high prices for consumers

What is NOT a reason to restrict trade?

Equilibrium price should go up, and equilibrium quantity should go down

What should happen to the equilibrium price and quantity in a market as a result of a quota on imports?

Equilibrium price should go up, and equilibrium quantity should go down

What should happen to the equilibrium price and quantity in a market as a result of a tariff on imports?

Lower ratios for both imports and exports

When comparing the ratio of trade to GDP, relative to other countries, the United States typically has __________________________.

It has an absolute advantage in producing the good

When one country can produce a given amount of a good using fewer inputs than any other country, ____________________________________.

Domestic consumers and foreign producers

When tariffs are imposed, the losers include ___________________________.

A prohibition on exports or imports

An embargo is _________________________________.