11) How does the supply curve of high-skilled workers compare to the supply curve of low-skilled workers? A) Because skills are costly to acquire, at a given wage rate the quantity supplied of high-skilled workers is greater than that of low-skilled workers. B) Because skills are costly to acquire, at any given wage rate the quantity supplied of high-skilled workers is less than that […]
100) The figure above shows the market for the chemical hydrogen sulfide, the production of which creates an external cost. If the government assesses the marginal external cost correctly, what is the amount of the pollution tax that eliminates the inefficiency? A) $2 per pound B) $3 per pound C) $4 per pound D) $1 per pound. E) None of the above […]
11) The table above gives four production possibilities for airplanes and cruise ships. In possibility A, how many resources are devoted to the production of airplanes? A) 0 B) few C) most D) all E) It is impossible to tell without more information about the prices of airplanes and cruise ships. 12) The table above gives four production possibilities for […]
9.2 Winners, Losers, and Net Gains from Trades 1) International trade benefits A) only the exporter. B) only the importer. C) both the exporter and the importer. D) neither the exporter nor the importer. E) the exporter at all times and sometimes also the importer. 2) Who gains from international trade? A) only the exporting nation B) only the importing nation C) […]
12.1 Gross Domestic Product Measures Total Production 1) In May 2009, Ford Motor Company’s sales were down 20 percent from a year earlier. These events were caused by A) an economic recession. B) an economic expansion. C) a reduction in advertising. D) declining quality of service. 2) In May 2009, the U.S. auto industry experienced a 34 percent decline in sales compared to May […]
6.7 Integrative Questions 1) The figure above shows the market for brooms. If the market is efficient, A) 0 brooms are produced. B) 600 brooms are produced. C) more than 1000 brooms are produced. D) between 0 and 600 brooms are produced. E) between 600 and 1000 brooms are produced. 2) The figure above shows the market for brooms. If 800 brooms are produced, […]
20.1 Measuring Economic Inequality 1) In the United States, the poorest 20 percent of the household receive approximately ________ percent of total money income. A) 3.3 B) 9.5 C) 11.8 D) 17.6 E) 20.0 2) In the United States, the richest 20 percent of households receive approximately ________ percent of total money income. A) 33 B) 12 C) 50 D) 75 E) […]
21) Suppose that in 2012, real GDP is larger than nominal GDP. The GDP price index in 2012 is definitely A) negative. B) larger than the GDP price index in 2012. C) less than the GDP price index in 2012. D) greater than 100. E) less than 100. 22) The ________ is the average hourly wage rate measured in current dollars, while […]
101) Refer to Figure 4-4. Suppose the government imposes a tax of $0.60 per soft-drink purchased. The after-tax price received by the seller becomes A) $1.80 B) $2.00 C) $2.20 D) $2.40 E) $2.60 102) Refer to Figure 4-4. Suppose the government imposes a tax of $0.60 per soft drink purchased. The change in total expenditure on soft drinks is A) a decrease of […]
91) Suppose that there is an increase in expected future disposable income and simultaneously an increase in the expected profitability of investment. As a result, the equilibrium real interest rate ________ and the equilibrium quantity of loanable funds ________. A) rises; might increase, decrease, or not change B) rises; increases C) rises; decreases D) falls; might increase, decrease, or not change E) falls; […]
18.3 The Case Against Protection
1) If supporters of restrictions on imports argue that protection is needed to preserve a strategic industry, which of the following is being used?
A) Save domestic jobs argument
B) National security argument
C) Dumping argument
D) Infant-industry argument
E) Protecting national culture argument
2) Which of the following is the national security argument against free trade?
A) A country must protect industries that produce defense equipment and armaments.
B) A country must protect new industries to give them a chance to mature before facing foreign competition.
C) A country must protect firms from dumping by foreign companies.
D) A country must protect its consumers from foreign influences.
E) A country must preserve its jobs.
3) What is the national security argument to support protection from international trade?
A) Domestic firms must be protected until they gain a comparative advantage.
B) Any firm necessary in wartime must be protected.
C) Foreign producers selling below cost to drive domestic firms bankrupt must be stopped.
D) Domestic jobs must be protected from competition from low-paid foreign workers.
E) Foreigners selling products in the economy limit the nation's diversity and stability.
4) What is the infant-industry argument for protection from international trade?
A) Domestic firms must be protected until they gain a comparative advantage.
B) Any firm necessary in wartime must be protected.
C) Foreign producers selling below cost to drive domestic firms bankrupt must be stopped.
D) Domestic jobs must be protected from competition from low-paid foreign workers.
E) Foreigners selling products in the economy limit the nation's diversity and stability.
5) When protection is encouraged to protect a growing domestic industry; which of the following is being used?
A) Save domestic jobs argument
B) National security argument
C) Anti-dumping argument
D) Infant-industry argument
E) Diversity and stability argument
6) The infant-industry argument is used by those who assert they want to
A) limit imports to protect new industries.
B) increase exports to encourage growth of new industries.
C) limit exports.
D) increase imports to earn money to support new industries.
E) encourage foreign firms to dump in the United States.
7) The infant-industry argument for protection is based on the idea of
A) learning-by-doing.
B) dumping.
C) absolute advantage.
D) quotas are the least harmful method of protecting domestic firms.
E) saving jobs in the U.S. economy.
8) What is the dumping argument for protection from international trade?
A) Domestic firms must be protected until they gain a comparative advantage.
B) Any firm necessary in wartime must be protected.
C) Foreign producers selling below cost to drive domestic firms bankrupt must be stopped.
D) Domestic jobs must be protected from competition from low-paid foreign workers.
E) Foreigners selling products in the economy limit the nation's diversity and stability.
9) When a tariff supporter argues that foreign producers are selling their products for prices below the costs of production, which of the following is being used?
A) Save domestic jobs argument
B) National security argument
C) Dumping argument
D) Infant-industry argument
E) Diversity and stability argument
10) Dumping is defined as the situation in which
A) domestic producers sell a product at prices below the cost of production.
B) foreign producers sell a product at a price below the cost of production.
C) foreign producers sell a product at a price above a fair level.
D) domestic producers cut production to drive up domestic prices.
E) domestic producers are protected by tariffs.
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