MacroEconomics Chapter 19 SG Questions
Based on the information in Table 35.1, assume China and the United States have the same amount of resources with which to produce soybeans and computers and they produce no other goods. The opportunity cost of producing 1 computer in China is
1/3 of a ton of soybeans
Based on the information in Table 35.1, assume China and the United States have the same amount of resources with which to produce soybeans and computers and they produce no other goods. The opportunity cost of producing 1 ton of soybeans in the United States is
5 computers
Suppose China can produce either 300 telephones or 200 DVD players, and Japan can produce either 200 telephones or 100 DVD players. Implicitly Japan has
A comparative but not an absolute advantage in telephones
Which of the following is a gain from trade
A giver standard of living for all trading countries
A quota is
A limit on the quantity of a good that may be imported
The infant industry argument can be justified because
A new industry may be difficult to start in the face of existing foreign competition
Assume the United States and Canada have the same amount of resources. In a given time period, the United States can produce 3 tons of steel or 300 tons of wheat. Canada can produce 4 tons of steel or 400 tons of wheat. This means that
Canada has an absolute advantage in steel and wheat
Specialization in production and then trading with other countries
Change the mix of output for each country and increase total world output
Suppose China can produce 200 TVs or 200 DVD players. South Korea can produce either 100 TV's to 200 DVD players. In terms of TV production we can conclude that
China has a comparative advantage
Based on the information in Table 35.1, assume China and the United States have the same amount of resources with which to produce soybeans and computers and they produce no other goods. The output of computers and soybeans would be greatest if
China specialized in producing soybeans, and the United States specialized in making computers
If a country is completely self-reliant in producing goods for its own consumption needs, then
Consumption possibilities will increase with specialization and trade
If the United States raises tariffs on foreign goods, it may achieve
Greater profitability of import competing firms
Protectionism achieves which of the following goals?
Protection of infant industries
Producers of paper products are most likely to be in favor of
Protectionism in the paper product market but free trade in the lumber maket
International Trade
Redistributes income from import competing industries to export industries
Based on the information in Table 35.1, assume China and the United States have the same amount of resources with which to produce soybeans and computers and they produce no other goods. From the information in Table 35.1, it is clear that
The United States has an absolute advantage in both goods
Which of the following groups has an interest in encouraging free trade
Workers in export industries
When a country has a lower opportunity cost in producing a good than any other country
consumption possibilities will increase with specialization and trade
When a country imposes tariffs, it is likely to cause
higher prices for the import competing goods
Suppose that Brazil has a comparative advantage in coffee and Mexico has a comparative advantage in tomatoes. Which of the following groups would be worse off if these countries specialize and trade
Mexican coffee producers
Which group is most likely to be adversely affected by the importation of foreign steel
Domestic steelworkers
In terms of the world as a whole, imports must equal exports because
Every good exported by one country becomes an import for another country
A country has a comparative advantage in a good if
It can produce a good at a lower opportunity cost relative to another country
If the United States has a trade deficit, this means that
The trade balance is negative
World output of goods and services increases with specialization because
The world's resources are being used more efficiently