Question :
1.Whenacountrythatimportedaparticulargoodabandonsafree-tradepolicyandadoptsano-tradepolicy,
a.producersurplusincreasesandtotalsurplusincreasesinthemarketforthatgood.
b.producersurplusincre : 1262646
1.Whenacountrythatimportedaparticulargoodabandonsafree-tradepolicyandadoptsano-tradepolicy,
a.producersurplusincreasesandtotalsurplusincreasesinthemarketforthatgood.
b.producersurplusincreasesandtotalsurplusdecreasesinthemarketforthatgood.
c.producersurplusdecreasesandtotalsurplusincreasesinthemarketforthatgood.
d.producersurplusdecreasesandtotalsurplusdecreasesinthemarketforthatgood.
2.When,inouranalysisofthegainsandlossesfrominternationaltrade,weassumethatacountryissmall,weareineffectassumingthatthecountry
a.cannotexperiencesignificantgainsorlossesbytradingwithothercountries.
b.cannothaveasignificantcomparativeadvantageoverothercountries.
c.cannotaffectworldpricesbytradingwithothercountries.
d.Alloftheabovearecorrect.
3.When,inouranalysisofthegainsandlossesfrominternationaltrade,weassumethataparticularcountryissmall,weare
a.assumingthedomesticpricebeforetradewillcontinuetoprevailoncethatcountryisopeneduptotradewithothercountries.
b.assumingthereisnodemandforthatcountry’sdomesticallyproducedgoodsbyothercountries.
c.assuminginternationaltradecanbenefitproducers,butnotconsumers,inthatcountry.
d.makinganassumptionthatisnotnecessarytoanalyzethegainsandlossesfrominternationaltrade.
4.Inanalyzinginternationaltrade,weoftenfocusonacountrywhoseeconomyissmallrelativetotherestoftheworld.Wedoso
a.becauseitisimpossibletoanalyzethegainsandlossesfrominternationaltradewithoutmakingthisassumption.
b.becausethenwecanassumethatworldpricesofgoodsareunaffectedbythatcountry’sparticipationininternationaltrade.
c.inordertoruleoutthepossibilityoftariffsorquotas.
d.Alloftheabovearecorrect.
5.Inanalyzingthegainsandlossesfrominternationaltrade,tosaythatMoldovaisasmallcountryistosaythat
a.Moldovacanonlyimportgoods;itcannotexportgoods.
b.Moldova’schoiceofwhichgoodstoexportandwhichgoodstoimportisnotbasedontheprincipleofcomparativeadvantage.
c.onlythedomesticpriceofagoodisrelevantforMoldova;theworldpriceofagoodisirrelevant.
d.Moldovaisapricetaker.
6.Whenacountryallowstradeandbecomesanexporterofagood,
a.domesticproducersgainanddomesticconsumerslose.
b.domesticproducersloseanddomesticconsumersgain.
c.domesticproducersanddomesticconsumersbothgain.
d.domesticproducersanddomesticconsumersbothlose.
7.Tradeenhancestheeconomicwell-beingofanationinthesensethat
a.bothdomesticproducersanddomesticconsumersofagoodbecomebetteroffwithtrade,regardlessofwhetherthenationimportsorexportsthegoodinquestion.
b.thegainsofdomesticproducersofagoodexceedthelossesofdomesticconsumersofagood,regardlessofwhetherthenationimportsorexportsthegoodinquestion.
c.traderesultsinanincreaseintotalsurplus.
d.tradeputsdownwardpressureonthepricesofallgoods.
8.Whenacountryallowstradeandbecomesanimporterofagood,
a.bothdomesticproducersanddomesticconsumersbecomebetteroff.
b.domesticproducersbecomebetteroff,anddomesticconsumersbecomeworseoff.
c.domesticproducersbecomeworseoff,anddomesticconsumersbecomebetteroff.
d.bothdomesticproducersanddomesticconsumersbecomeworseoff.
9.Whenacountryallowstradeandbecomesanimporterofagood,
a.everyoneinthecountrybenefits.
b.thegainsofthewinnersexceedthelossesofthelosers.
c.thelossesofthelosersexceedthegainsofthewinners.
d.everyoneinthecountryloses.
10.WhenthenationofWorldovaallowstradeandbecomesanexporterofsilk,
a.residentsofWorldovawhoproducesilkbecomeworseoff;residentsofWorldovawhobuysilkbecomebetteroff;andtheeconomicwell-beingofWorldovarises.
b.residentsofWorldovawhoproducesilkbecomeworseoff;residentsofWorldovawhobuysilkbecomebetteroff;andtheeconomicwell-beingofWorldovafalls.
c.residentsofWorldovawhoproducesilkbecomebetteroff;residentsofWorldovawhobuysilkbecomeworseoff;andtheeconomicwell-beingofWorldovarises.
d.residentsofWorldovawhoproducesilkbecomebetteroff;residentsofWorldovawhobuysilkbecomeworseoff;andtheeconomicwell-beingofWorldovafalls.