A trade deficit refers to a situation where: |
Exports are less than imports |
Which country is the United States’ largest trading partner in terms of volume of trade? |
Canada |
Which of the following product-groups is a leading export of the United States? |
Chemicals |
Which of the following products is a leading import of the United States? |
Petroleum |
The best example of a labor-intensive commodity is: |
Clothing |
A natural-resource abundant nation would be expected to export a land-intensive commodity such as: |
Meat |
What other economic process tends to accompany international trade, for nations to benefit from such trade? |
Specialization in production |
The slopes of the production possibilities curves for two nations reflect the: |
Opportunity costs of production in the two nations |
The ratio at which nations will exchange one product for another is known as the: |
Terms of trade |
Specialization and trade between individuals or between nations lead to: |
Higher total output |
In a two-nation world, comparative advantage means that one nation can produce: |
A product at a lower domestic opportunity cost than the other nation |
The benefits to trading nations based on comparative advantage accrue from: |
Specialization and trading |
The principal concept behind comparative advantage is that a nation should: |
Concentrate production on those products for which it has the lowest domestic opportunity cost |
A maximum limit set on the amounts of commodities that may be imported into a country in any period of time is a: |
Quota |
The "Buy American" campaign is equivalent to a(n): |
Quota |
A tariff is a: |
Tax |
An excise tax on imported commodities is known as a(n): |
Tariff |
An excise tax that is applied to imported products which are not produced domestically is a(n): |
Revenue tariff |
A licensing requirement, or unreasonable standard pertaining to the product quality and safety for a product that is imported into a country, are examples of: |
Nontariff barriers |
Which would best describe a protective tariff? |
An excise tax that is designed to put foreign producers at a competitive disadvantage in selling in domestic markets |
An example of a nontariff barrier would be: |
Excessive licensing requirements |
If a nation agrees to set an upper limit on the total amount of a product that it exports to another nation, then this situation would be an example of: |
A voluntary export restriction |
The imposition of a tariff on a product is least likely to result in a(n): |
Increase in the efficiency in the domestic industry producing the product |
Tariffs and quotas are costly to consumers because: |
Consumers shift purchases to higher-priced domestic goods |
From an economic perspective, studies of the costs of trade barriers show that they: |
Far exceed their benefits for society |
Dumping is the sale of a product in a foreign market: |
At a price below its domestic price or cost of production |
Econ Final 20
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