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ECON 340 Final Exam Study Guide Multiple Choice With Questions And 100% SURE ANSWERS
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JACKLINEECON 340 Final Exam Study Guide Multiple Choice With Questions And 100%
SURE ANSWERS
Terms in this set (102)
Which of the following is NOT a preferential OECD
trading arrangement?
a. EU
b. NAFTA
c. OECD
d. GSP
e. Anti-dumping duty
ECON 340 Final Exam Study Guide Multiple Choice
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,Which of the following explains why trade The country imports from the partner at higher cost than it previously imported from some other
diversion is undesirable for an importing country country.
that lowers its tariff against a partner in a free
trade area?
a. The country imports from the partner at higher
cost than it previously imported from some other
country.
b. Domestic producers suffer a loss of income.
c. Workers are laid off as producers shift
production into the partner country.
d. Consumers pay a higher price for the good
imported from the partner.
e. All of the above.
When a country eliminates its tariff against a Must gain.
partner country, keeping the tariff positive against
other countries, the effect of that change alone is
that the partner as a whole
a. Must gain.
b. May either gain or lose.
c. Will neither gain nor lose.
d. Must lose.
e. None of the above; it depends on whether
there is trade creation or trade
diversion.
ECON 340 Final Exam Study Guide Multiple Choice
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,Because wages in Mexico before the NAFTA were Prior to NAFTA, since US tariffs against Mexico were small, the productivity of Mexican workers
only a small fraction (perhaps 1/10) of wages in the must also have been only a small fraction of that in the US.
US, we should infer that
a. Prior to NAFTA, Mexican workers were paid far
below their productivity.
b. After NAFTA, most U.S. firms would be unable
to compete with imports from
Mexico.
c. After NAFTA, most U.S. firms would close their
U.S. plants and move to
Mexico.
d. Prior to NAFTA, since U.S. tariffs against Mexico
were small, the productivity
of Mexican workers must also have been only a
small fraction of that in the U.S.
e. After NAFTA, forcing Mexican workers to
compete with more productive U.S.
workers would drive their wages even lower.
Mexico's international reserves Fell during the year after NAFTA went into effect, precipitating the Peso Crisis.
a. Declined during the years that NAFTA was
being negotiated, which was one of the reasons
Mexico wanted the agreement.
b. Rose until NAFTA went into effect, but have
declined ever since.
c. Fell during the year after NAFTA went into
effect, precipitating the Peso Crisis.
d. Rose until the Peso Crisis, which caused them to
fall precipitously.
e. Have risen steadily throughout the 1990s and
since 2000. ECON 340 Final Exam Study Guide Multiple Choice
3/34
, What effect did the NAFTA have on US NAFTA did not disrupt the more-or-less steady decline in the US unemployment rate that took
unemployment? place throughout the period between the 1991 and 2001 recessions.
a. NAFTA caused the 1991 recession.
b. NAFTA caused the 2001 recession.
c. NAFTA caused US unemployment to rise by two
percentage points, in 1994,
when it went into effect.
d. NAFTA caused US unemployment to rise by two
percentage points, but not
until 1995 when the Peso Crisis hit.
e. NAFTA did not disrupt the more-or-less steady
decline in the US
unemployment rate that took place throughout
the period between the 1991 and 2001 recessions.
Why did NAFTA not have a significant effect on US The number of workers who lost jobs due to NAFTA was a tiny fraction of normal US labor
unemployment? turnover.
a. No jobs were lost in the US due to NAFTA.
b. The number of workers who lost jobs due to
NAFTA was a tiny fraction of
normal US labor turnover.
c. Workers who lost jobs in the US were able to
move to Mexico.
d. The US reneged on its NAFTA promise to lower
tariffs on imports from
Mexico.
e. Mexican companies built factories in the US that
employed US workers that had
been laid off from US factories.
ECON 340 Final Exam Study Guide Multiple Choice
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