Macroeconomics- International Trade Test Questions with complete Solutions Graded A+
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Macroeconomics
Institution
Macroeconomics
Macroeconomics- International Trade Test Questions with complete Solutions Graded A+
Goods and services that we buy from other countries are our - Answers imports.
The goods and services we sell to people in other countries are our - Answers exports.
The fundamental force that drives internatio...
Macroeconomics- International Trade Test Questions with complete Solutions Graded A+
Goods and services that we buy from other countries are our - Answers imports.
The goods and services we sell to people in other countries are our - Answers exports.
The fundamental force that drives international trade is - Answers comparative advantage.
The fundamental force that drives international trade is - Answers comparative advantage.
A country - Answers exports those goods in which it has a comparative advantage.
Canada has a comparative advantage in producing airplanes if - Answers it can produce them at a lower
opportunity cost than another country.
Prior to international trade, if the price of good X is lower in country A than in country B, - Answers
country A has a comparative advantage in the production of good X.
Which of the following statements about Canada's international trade in 2008 is correct? - Answers The
value of Canada's exports exceeded the value of Canada's imports.
Canada has a comparative advantage in producing hardwood if the Canadian price of hardwood before
international trade is ________ the world price - Answers less than
Compared to the situation before international trade, after Canada exports a good, production in
Canada ________ and consumption in Canada ________. - Answers increases; decreases
Compared to the situation before international trade, after Canada imports a good, production in
Canada ________ and consumption in Canada ________. - Answers decreases; increases
Which of the following is a Canadian service export? - Answers A Swiss buys dinner while travelling in
Canada.
Canada produces both lumber and wine. Canada exports lumber and imports wine. The rest of the world
imports Canadian lumber and exports wine to Canada. Canada has a comparative advantage in
producing ________. The rest of the world has a comparative advantage in producing ________. -
Answers lumber; wine
Consider a country that sells some of its goods as exports. Who does NOT benefit? - Answers domestic
consumers
Who benefits from imports? - Answers domestic consumers
A country opens up to trade. In an import industry, - Answers domestic producers lose and domestic
consumers gain.
A market is open to international trade. At the world price, the quantity demanded is 150 units and the
quantity supplied is 200 units. This country will - Answers export 50 units.
, A country opens up to trade. In an export industry, - Answers domestic consumers lose and domestic
producers win.
Consider a market that sells some of its goods as exports. Who does NOT benefit? - Answers domestic
consumers
Who benefits from imports? - Answers domestic consumers
Canada produces both lumber and wine. Canada exports lumber and imports wine. The rest of the world
imports Canadian lumber and exports wine to Canada. When Canada exports lumber to the rest of the
world and the rest of the world exports wine to Canada ________. A) lumber producers in the rest of
the world lose and wine producers in the rest of the world gain B) Canada's lumber producers gain C)
Canada's wine producers lose D) all of the above - Answers Answer: D
Canada produces both lumber and wine. Canada exports lumber and imports wine. The rest of the world
imports Canadian lumber and exports wine to Canada. If Canada did not trade with the rest of the
world, then the equilibrium price of lumber would be ________ in Canada than the rest of the world,
and the equilibrium price of wine would be ________ in Canada than the rest of the world. - Answers
lower; higher
Canada produces both lumber and wine. Canada exports lumber and imports wine. The rest of the world
imports Canadian lumber and exports wine to Canada. Canada has a comparative advantage in
producing ________. The rest of the world has a comparative advantage in producing ________. -
Answers lumber; wine
Suppose that the world price of oats is 30 cents a kilogram. Canada does not trade internationally, and
the equilibrium price of oats in Canada is 40 cents a kilogram. Canada then begins to trade
internationally. The price of oats in Canada ________. Canadian consumers buy ________ oats.
Canadian firms produce ________ oats. Canada ________ oats. - Answers falls; more; less; imports
A tariff is a tax that is imposed by the ________ country when an ________ good crosses its
international boundary. - Answers importing; imported
A tax that is imposed by the importing country when an imported good crosses its international
boundary is called - Answers a tariff.
Tariffs and import quotas differ in that - Answers one is a tax, while the other is a limit.
Tariffs and import quotas both result in - Answers lower levels of imports.
If Canada imposes a tariff on imported cars - Answers the price in Canada rises but neither Canada's
demand curve nor Canada's supply curve shifts.
Which of the following statements concerning tariffs is NOT true? - Answers A tariff leaves the price of
imports unchanged.
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