Question 1

For Country A, the world price of textiles exceeds the domestic equilibrium price of textiles. As a result, international trade allows sellers of textiles in Country A to experience greater producer surplus than they otherwise would experience.

Accepted Answer

A) True 
 B)False

Question 2

Japan imposes a $300 per ton tariff on imported steel, raising the price charged in Japan to $1,000. Using only this information, which of the following statements is correct?

Accepted Answer

A)   The world price for steel is $300.
B)   The world price for steel is $700.
C)   The world price for steel is $1,000.
D)   The world price for steel is $1,300.E) B) and C)
F) A) and D)

Question 3

Figure 9-9 
-Refer to Figure 9-9. Consumer surplus in this market before trade is

Accepted Answer

A)   A.
B)   A + B.
C)   A + B + D.
D)   C.E) None of the above
F) All of the above

Question 4

If the United States imports televisions and the U.S. government imposes a tariff on televisions, then

Accepted Answer

A)   total surplus in the American television market decreases.
B)   producer surplus in the American television market increases.
C)   U.S. imports of foreign televisions decrease.
D)   All of the above are correct.E) C) and D)
F) A) and B)

Question 5

Figure 9-7. The figure applies to the nation of Wales and the good is cheese. 
-Refer to Figure 9-7. Which of the following is a valid equation for the gains from trade?

Accepted Answer

A)   Gains from trade = (1/2) (P1 - P0) (Q2 - Q1) .
B)   Gains from trade = (1/2) (P1 - P0) (Q2 - Q0) 
C)   Gains from trade = (1/2) (P1 - P0) (Q1 + Q2) .
D)   Gains from trade = (1/2) (Q1) (P3 - P1) .E) A) and B)
F) B) and C)

Question 6

Figure 9-25
The following diagram shows the domestic demand and supply in a market. Assume that the world price in this market is $10 per unit. 
-Refer to Figure 9-25. With free trade, total surplus is

Accepted Answer

A)   $800.
B)   $1,200.
C)   $1,600.
D)   $2,000.E) A) and B)
F) A) and C)

Question 7

Figure 9-23
The following diagram shows the domestic demand and domestic supply for a market. Assume that the world price in this market is $120 per unit. 
-Refer to Figure 9-23. With free trade, the domestic price and domestic quantity demanded are

Accepted Answer

A)   $90 and 5.
B)   $90 and 10.
C)   $120 and 5.
D)   $120 and 18.E) B) and C)
F) A) and D)

Question 8

When a country allows trade and becomes an importer of bottled water, which of the following is not a consequence?

Accepted Answer

A)   The gains of domestic consumers of bottled water exceed the losses of domestic producers of bottled water.
B)   The losses of domestic producers of bottled water exceed the gains of domestic consumers of bottled water.
C)   The price paid by domestic consumers of bottled water decreases.
D)   The price received by domestic producers of bottled water decreases.E) C) and D)
F) A) and B)

Question 9

If a tariff is placed on watches, the price of both domestic and imported watches will rise by the amount of the tariff.

Accepted Answer

A) True 
 B)False

Question 10

Figure 9-5
The figure illustrates the market for tricycles in a country. 
-Refer to Figure 9-5. Without trade, consumer surplus amounts to

Accepted Answer

A)   $810.
B)   $1,620.
C)   $3,240.
D)   $6,480.E) A) and B)
F) A) and C)

Question 11

Figure 9-6
The figure illustrates the market for roses in a country. 
-Refer to Figure 9-6. The size of the tariff on roses is

Accepted Answer

A)   $4.
B)   $2.
C)   $2
D)   $1.E) All of the above
F) C) and D)

Question 12

When a country allows trade and becomes an exporter of a good, which of the following is not a consequence?

Accepted Answer

A)   The price paid by domestic consumers of the good increases.
B)   The price received by domestic producers of the good increases.
C)   The losses of domestic consumers of the good exceed the gains of domestic producers of the good.
D)   The gains of domestic producers of the good exceed the losses of domestic consumers of the good.E) All of the above
F) C) and D)

Question 13

The market for soybeans in Canada consists solely of domestic buyers of soybeans and domestic sellers of soybeans if

Accepted Answer

A)   consumer surplus equals producer surplus in the Canadian soybean market.
B)   total surplus exceeds consumer surplus in the Canadian soybean market.
C)   Canada permits international trade in soybeans.
D)   Canada forbids international trade in soybeans.E) All of the above
F) A) and B)

Question 14

Figure 9-28
The following diagram shows the domestic demand and domestic supply curves in a market. 
-Refer to Figure 9-28. Suppose the world price in this market is $6. If the country allows free trade, how much is producer surplus?

Accepted Answer

With trade...

Question 15

Figure 9-17 
-Refer to Figure 9-17. The deadweight loss caused by the tariff is

Accepted Answer

A)   $24.
B)   $72.
C)   $96.
D)   $144.E) A) and C)
F) All of the above

Question 16

About what percent of total world trade is accounted for by countries that belong to the World Trade Organization?

Accepted Answer

A)   54 percent
B)   72 percent
C)   89 percent
D)   97 percentE) B) and D)
F) A) and B)

Question 17

Scenario 9-2
-For a small country called Boxland, the equation of the domestic demand curve for cardboard is  where   represents the domestic quantity of cardboard demanded, in tons, and represents the price of a ton of cardboard.
-For Boxland, the equation of the domestic supply curve for cardboard is  where   represents the domestic quantity of cardboard supplied, in tons, and again represents the price of a ton of cardboard.
-Refer to Scenario 9-2. Suppose the world price of cardboard is $45. Then, relative to the no-trade situation, international trade in cardboard

Accepted Answer

A)   benefits Boxlandian consumers by $721 and harms Boxlandian producers by $525.00.
B)   benefits Boxlandian consumers by $721 and harms Boxlandian producers by $598.50.
C)   benefits Boxlandian consumers by $672 and harms Boxlandian producers by $598.50.
D)   harms Boxlandian consumers by $336 and harms Boxlandian producers by $525.00.E) B) and D)
F) None of the above

Question 18

Free trade allows firms to realize economies of scale, resulting in higher costs of production.

Accepted Answer

A) True 
 B)False

Question 19

Figure 9-23
The following diagram shows the domestic demand and domestic supply for a market. Assume that the world price in this market is $120 per unit. 
-Refer to Figure 9-23. Consumer surplus with free trade is

Accepted Answer

A)   $75.
B)   $150.
C)   $200.
D)   $300.E) B) and C)
F) A) and D)

Question 20

Figure 9-27
The following diagram shows the domestic demand and supply curves in a market. Assume that the world price in this market is $20 per unit. 
-Refer to Figure 9-27. If the country allows free trade, by how much do consumer surplus, producer surplus, and total surplus change with trade?

Accepted Answer

With trade, consumer surplus i...

Exam 9: Application: International Trade

If the United States imports televisions and the U.S. government imposes a tariff on televisions, then

Correct Answer
verified

Figure 9-23 The following diagram shows the domestic demand and domestic supply for a market. Assume that the world price in this market is $120 per unit. -Refer to Figure 9-23. Consumer surplus with free trade is

Correct Answer
verified

Japan imposes a $300 per ton tariff on imported steel, raising the price charged in Japan to $1,000. Using only this information, which of the following statements is correct?

Correct Answer
verified

Figure 9-17 -Refer to Figure 9-17. The deadweight loss caused by the tariff is

Correct Answer
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For Country A, the world price of textiles exceeds the domestic equilibrium price of textiles. As a result, international trade allows sellers of textiles in Country A to experience greater producer surplus than they otherwise would experience.

Correct Answer
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Figure 9-9 -Refer to Figure 9-9. Consumer surplus in this market before trade is

Correct Answer
verified

The market for soybeans in Canada consists solely of domestic buyers of soybeans and domestic sellers of soybeans if

Correct Answer
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Free trade allows firms to realize economies of scale, resulting in higher costs of production.

Correct Answer
verified

When a country allows trade and becomes an importer of bottled water, which of the following is not a consequence?

Correct Answer
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If a tariff is placed on watches, the price of both domestic and imported watches will rise by the amount of the tariff.

Correct Answer
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Correct Answer
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Figure 9-28 The following diagram shows the domestic demand and domestic supply curves in a market. -Refer to Figure 9-28. Suppose the world price in this market is $6. If the country allows free trade, how much is producer surplus?

Correct Answer
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With trade...
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Figure 9-25 The following diagram shows the domestic demand and supply in a market. Assume that the world price in this market is $10 per unit. -Refer to Figure 9-25. With free trade, total surplus is

Correct Answer
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Figure 9-6 The figure illustrates the market for roses in a country. -Refer to Figure 9-6. The size of the tariff on roses is

Correct Answer
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Figure 9-27 The following diagram shows the domestic demand and supply curves in a market. Assume that the world price in this market is $20 per unit. -Refer to Figure 9-27. If the country allows free trade, by how much do consumer surplus, producer surplus, and total surplus change with trade?

Correct Answer
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With trade, consumer surplus i...
View Answer

When a country allows trade and becomes an exporter of a good, which of the following is not a consequence?

Correct Answer
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Figure 9-5 The figure illustrates the market for tricycles in a country. -Refer to Figure 9-5. Without trade, consumer surplus amounts to

Correct Answer
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About what percent of total world trade is accounted for by countries that belong to the World Trade Organization?

Correct Answer
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Figure 9-7. The figure applies to the nation of Wales and the good is cheese. -Refer to Figure 9-7. Which of the following is a valid equation for the gains from trade?

Correct Answer
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Figure 9-23 The following diagram shows the domestic demand and domestic supply for a market. Assume that the world price in this market is $120 per unit. -Refer to Figure 9-23. With free trade, the domestic price and domestic quantity demanded are

Correct Answer
verified

Exam 9: Application: International Trade

If the United States imports televisions and the U.S. government imposes a tariff on televisions, then

Correct AnswerverifiedShow Answer

Figure 9-23 The following diagram shows the domestic demand and domestic supply for a market. Assume that the world price in this market is $120 per unit. -Refer to Figure 9-23. Consumer surplus with free trade is

Correct AnswerverifiedShow Answer

Japan imposes a $300 per ton tariff on imported steel, raising the price charged in Japan to $1,000. Using only this information, which of the following statements is correct?

Correct AnswerverifiedShow Answer

Figure 9-17 -Refer to Figure 9-17. The deadweight loss caused by the tariff is

Correct AnswerverifiedShow Answer

For Country A, the world price of textiles exceeds the domestic equilibrium price of textiles. As a result, international trade allows sellers of textiles in Country A to experience greater producer surplus than they otherwise would experience.

Correct AnswerverifiedShow Answer

Figure 9-9 -Refer to Figure 9-9. Consumer surplus in this market before trade is

Correct AnswerverifiedShow Answer

The market for soybeans in Canada consists solely of domestic buyers of soybeans and domestic sellers of soybeans if

Correct AnswerverifiedShow Answer

Free trade allows firms to realize economies of scale, resulting in higher costs of production.

Correct AnswerverifiedShow Answer

When a country allows trade and becomes an importer of bottled water, which of the following is not a consequence?

Correct AnswerverifiedShow Answer

If a tariff is placed on watches, the price of both domestic and imported watches will rise by the amount of the tariff.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Figure 9-28 The following diagram shows the domestic demand and domestic supply curves in a market. -Refer to Figure 9-28. Suppose the world price in this market is $6. If the country allows free trade, how much is producer surplus?

Correct AnswerverifiedWith trade...View AnswerShow Answer

Figure 9-25 The following diagram shows the domestic demand and supply in a market. Assume that the world price in this market is $10 per unit. -Refer to Figure 9-25. With free trade, total surplus is

Correct AnswerverifiedShow Answer

Figure 9-6 The figure illustrates the market for roses in a country. -Refer to Figure 9-6. The size of the tariff on roses is

Correct AnswerverifiedShow Answer

Figure 9-27 The following diagram shows the domestic demand and supply curves in a market. Assume that the world price in this market is $20 per unit. -Refer to Figure 9-27. If the country allows free trade, by how much do consumer surplus, producer surplus, and total surplus change with trade?

Correct AnswerverifiedWith trade, consumer surplus i...View AnswerShow Answer

When a country allows trade and becomes an exporter of a good, which of the following is not a consequence?

Correct AnswerverifiedShow Answer

Figure 9-5 The figure illustrates the market for tricycles in a country. -Refer to Figure 9-5. Without trade, consumer surplus amounts to

Correct AnswerverifiedShow Answer

About what percent of total world trade is accounted for by countries that belong to the World Trade Organization?

Correct AnswerverifiedShow Answer

Figure 9-7. The figure applies to the nation of Wales and the good is cheese. -Refer to Figure 9-7. Which of the following is a valid equation for the gains from trade?

Correct AnswerverifiedShow Answer

Figure 9-23 The following diagram shows the domestic demand and domestic supply for a market. Assume that the world price in this market is $120 per unit. -Refer to Figure 9-23. With free trade, the domestic price and domestic quantity demanded are

Correct AnswerverifiedShow Answer

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With trade...
View Answer

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With trade, consumer surplus i...
View Answer

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