Question :
51) Refer to Figure 19.2. the U.S. has
A) a comparative : 1381272
51) Refer to Figure 19.2. the U.S. has
A) a comparative advantage in producing trucks.
B) an absolute advantage in producing trucks.
C) a comparative advantage in producing cars.
D) no comparative advantage in producing either cars or trucks.
52) Assume that Blade Runner specializes in producing in-line skates and Hang Ten specializes in producing surfboards. After trade Blade Runner exports 800 pairs of in-line skates and imports 200 surfboards. The terms of trade
D) cannot be determined from this information.
53) When trade is free, patterns of trade and trade flows result from
A) the collective decisions of a few importers and exporters, as well as the governments of the countries in which they reside.
B) the collective decisions of a few importers and exporters, as well as millions of private households and firms.
C) the independent decisions of thousands of importers and exporters, as well as millions of private households and firms.
D) the independent decisions of thousands of importers and exporters, as well as the governments of the countries in which they reside.
54) If you are traveling in China and you purchase a meal that costs 140 yuan and the current exchange rate is 7 yuan to the dollar, then the price of the meal in U.S. currency is
A) $200.
B) $20.
C) $10.
D) $2
55) Suppose a U.S. dollar exchanges for 2 British pounds, then each pound is worth
A) $.25.
B) $.50.
C) $1.
D) $4.
56) If the price of a car in the United States is $26,000, and the exchange rate between the dollar and the British pound rises from $1.50 to $2.00 per pound, then the price of the American car in Britain will
A) fall.
B) rise.
C) remain the same.
D) be irrelevant, because the British government will impose restrictions on imports from the United States.
57) If the price of a car in the United States is $22,000, and the exchange rate between the dollar and the Japanese yen falls from 125 yen to 105 yen per dollar, then the price of the American car in Japan will
A) fall.
B) rise.
C) remain the same.
D) be irrelevant, because the Japanese government will impose restrictions on imports from the United States.
58) For any pair of countries, there is
A) a range of exchange rates that can lead automatically to both countries realizing the gains from specialization and comparative advantage.
B) one single exchange rate that will lead indirectly to one country realizing the gains from specialization and comparative advantage, but not the other country.
C) a range of exchange rates that can lead indirectly to one country realizing the gains from specialization and comparative advantage, but not the other country.
D) one single exchange rate that will lead automatically to both countries realizing the gains from specialization and comparative advantage.
Refer to the information provided in Table 19.3 below to answer the questions that follow.
Table 19.3
59) Refer to Table 19.3. If the exchange rate is $1 = 1 euro, then
A) the United States will import both raspberries and chocolate.
B) Belgium will import both raspberries and chocolate.
C) the United States will import chocolate and Belgium will import raspberries.
D) Belgium will import chocolate.
60) Refer to Table 19.3. If the exchange rate is $1 = 3 euros, then
A) the United States will import both raspberries and chocolate.
B) Belgium will import both raspberries and chocolate.
C) the United States will import chocolate and Belgium will import raspberries.
D) the United States will import raspberries and Belgium will import chocolate.
