Part 1 of 1 – 50.0
Points
Question 1 of 19 1.0
Points
When trade opens up, all consumers are made better off.
True
False
Question 2 of 19 1.0
Points
In the simple trade model, countries with identical
pre-trade prices for a good have no incentive to trade in that good.
True
False
Question 3 of 19 1.0
Points
If one producer is made better off by trade, then all
producers in the same country must be made better off by trade.
True
False
Question 4 of 19 1.0
Points
At the equilibrium trade price between two countries, the
excess supply of the good in one country must equal the excess demand for the
good in the other country.
True
False
Question 5 of 19 1.0
Points
There ainât no such thing as a free lunch, but there is such
a thing as free trade.
True
False
Question 6 of 19 2.0
Points
After trade has opened up, the gains that trade brings to
consumers of the imported goods are, in absolute value,
A. larger than the losses to domestic producers of that
good.
B. smaller than the losses to domestic producers of that
good.
C. exactly equal to the losses to domestic producers of that
good.
D. immeasurable.
Question 7 of 19 2.0
Points
Which of the following is not likely to promote free trade
in lumber between countries?
A. Pre-trade lumber prices that are equal across countries.
B. Profit-seeking lumber arbitrageurs.
C. Lumber supply differences between countries.
D. Lumber demand differences between countries.
Question 8 of 19 2.0
Points
After trade, the distribution of income in a country changes
as
A. import-competing producers lose while producers of the
exportable good gain.
B. the nation as a whole gains while individuals lose.
C. consumers lose while producers gain.
D. income flows from consumers to producers.
Question 9 of 19 2.0
Points
If export supply is less price elastic than import demand,
then the
A. importing country will not want to trade.
B. exporting country will not want to trade.
C. exporting country will receive the largest share of the
gains from trade.
D. importing country will receive the largest share of the
gains from trade.
Question 10 of 19 2.0
Points
Referring to figure above, at a price of $70, the amount of
consumer surplus is:
A. $6,000.
B. $8,000.
C. $15,000.
D. $30,000.
Question 11 of 19 2.0
Points
Referring to figure, at a price of $70, the amount of
producer surplus is:
A. $6,000.
B. $8,000.
C. $15,000.
D. $30,000.
Question 12 of 19 2.0
Points
Consider a typical two-country model. In the exporting
country, consumers will be __________ and producers will be __________ with the
opening of international trade.
A. Happy; happy
B. Unhappy; happy
C. Unhappy; unhappy
D. Happy; unhappy
Question 13 of 19 2.0
Points
Use the following information
Suppose the domestic supply and demand curves for
skateboards in the United States are given by the following set of equations:
QS = -60 + 3P
QD = 390 â 2P
In the absence of international trade in skateboards, what
will the domestic price in the United States be for skateboards?
A. $66
B. $90
C. $45
D. $150
Question 14 of 19 2.0
Points
Use the following information
Suppose the domestic supply and demand curves for
skateboards in the United States are given by the following set of equations:
QS = -60 + 3P
QD = 390 â 2P
In the absence of international trade in skateboards how
many skateboards will be sold in the United States?
A. 138
B. 258
C. 210
D. 930
Question 15 of 19 2.0
Points
An increase in the imports of clothing into the United
States from India will benefit the _____ and hurt the ____.
A. U.S. clothing producers; Indian clothing producers
B. Indian consumers; Indian clothing producers
C. U.S. consumers; Indian clothing producers
D. U.S. consumers; the U.S. clothing producers
Question 16 of 19 2.0
Points
Use the following information
Suppose the domestic supply and demand curves for
skateboards in the United States are given by the following set of equations:
QS = -60 + 3P
QD = 390 â 2P
If the United States could trade skateboards freely with the
rest of the world at a price of $75, how many skateboards would be purchased in
the United States?
A. 165
B. 240
C. 285
D. It depends on foreign supplies of skateboards.
Question 17 of 19 8.0
Points
Carefully explain why nations gain from engaging in
international trade. Do nations gain equally from trade? If not, what
determines which country gains more? (In your answer you can assume a
two-country world.)
Note: Answer should be 100 – 150 words.
Question 18 of 19 7.0
Points
What is the logic of producing winter clothing in countries
whose residents have very little demand for such clothing? (80-100 words)
Question 19 of 19 8.0
Points
Country A produces shoes at a lower cost than the country B.
As a result, most of the shoes purchased in the country B are made in country
A. Explain how trading with country A results in a net gain for country B?
(should be 100- 150 words)
