31.Ifacountryisanexporterofagood,thenitmustbethecasethat a.theworldpriceislessthanitsdomesticprice. b.consumersurplusishigherthananotradesituation. c.theworldpriceisgreaterthanitsdomesticprice. d.theyusedaninfant-industryargumenttoprotectitsproducers. 32.SupposeJapanexportscarstoRussiaandimportswinefromFrance.Thissituationsuggests a.JapanhasacomparativeadvantagerelativetoFranceinproducingwine,andRussiahasacomparativeadvantagetoJapaninproducingcars. b.JapanhasacomparativeadvantagerelativetoRussiainproducingcars,andFrancehasacomparativeadvantagerelativetoJapaninproducingwine. c.JapanhasanabsoluteadvantagerelativetoRussiainproducingcars,andFrancehasanabsoluteadvantagerelativetoJapaninproducingwine. d.JapanhasanabsoluteadvantagerelativetoFranceinproducingwine,andRussiahasanabsoluteadvantagerelativetoJapaninproducingcars. 33.SupposeJapanexportstelevisionstotheUnitedStatesandimportssugarfromArgentina.Thissituationsuggests a.JapanhasacomparativeadvantagerelativetotheUnitedStatesinproducingtelevisions,andArgentinahasacomparativeadvantagerelativetoJapaninproducingsugar. b.JapanhasacomparativeadvantagerelativetotheUnitedStatesinproducingsugar,andArgentinahasacomparativeadvantagerelativetoJapaninproducingtelevisions. c.JapanhasanabsoluteadvantagerelativetotheUnitedStatesinproducingtelevisions,andArgentinahasanabsoluteadvantagerelativetoJapaninproducingsugar. d.JapanhasanabsoluteadvantagerelativetoArgentinainproducingsugar,andtheUnitedStateshasanabsoluteadvantagerelativetoJapaninproducingtelevisions. 34.AssumethenationofTeeveelanddoesnottradewiththerestoftheworld.BycomparingtheworldpriceoftelevisionstothepriceoftelevisionsinTeeveeland,wecandeterminewhether a.consumersurplusexceedsproducersurplusinTeeveeland. b.Teeveelandhasanabsoluteadvantageinproducingtelevisions. c.Teeveelandhasacomparativeadvantageinproducingtelevisions. d.Alloftheabovearecorrect. 35.BycomparingtheworldpriceofpecanstoIndia’sdomesticpriceofpecans,wecandeterminewhetherIndia a.willexportpecans(assumingtradeisallowed). b.willimportpecans(assumingtradeisallowed). c.hasacomparativeadvantageinproducingpecans. d.Alloftheabovearecorrect. 36.CostaRicaallowstradewiththerestoftheworld.WecandeterminewhetherCostaRicahasacomparativeadvantageinproducingpharmaceuticalsifwe a.knowwhetherCostaRicaimportsorexportspharmaceuticals. b.comparetheworldpriceofpharmaceuticalstothepriceofpharmaceuticalsthatwouldprevailinCostaRicaiftradewiththerestoftheworldwerenotallowed. c.comparethequantityofpharmaceuticalsconsumedinCostaRicawiththequantityofpharmaceuticalsthatwouldbeconsumedinCostaRicaiftradewiththerestoftheworldwerenotallowed. d.Alloftheabovearecorrect. 37.Spainallowstradewiththerestoftheworld.WeknowthatSpainhasacomparativeadvantageinproducingoliveoilifweknowthat a.Spain importsoliveoil. b.the worldprice ofolive oilis higherthanthe priceof oliveoil thatwould prevailinSpain iftrade withothercountrieswerenotallowed. c.consumersurplusinSpainwouldexceedproducersurplusinSpainiftradewithothercountrieswerenotallowed. d.Alloftheabovearecorrect. 38.ThenationofFarmlandforbidsinternationaltrade.InFarmland,youcanexchange1poundofbeeffor2poundsofpepper.Inothercountries,youcanexchange1poundofbeeffor4poundsofpepper.Thesefactsindicatethat a.Farmlandhasacomparativeadvantage,relativetoothercountries,inproducingbeef. b.othercountrieshaveanabsoluteadvantage,relativetoFarmland,inproducingbeef. c.thepriceofbeefinFarmlandexceedstheworldpriceofbeef. d.ifFarmlandweretoallowtrade,itwouldexportpepper. 39.ThenationofIsolaniforbidsinternationaltrade.InIsolani,youcanexchange1carfor5motorcycles.Inothercountries,youcanexchange1carfor4motorcycles.Thesefactsindicatethat a.othercountrieshaveanabsoluteadvantage,relativetoIsolani,inproducingcars. b.Isolanihasacomparativeadvantage,relativetoothercountries,inproducingcars. c.ifIsolaniweretoallowtrade,itwouldimportmotorcycles. d.theworldpriceofmotorcyclesexceedsthepriceofmotorcyclesinIsolani. 40.AssumeforGuatemalathatthedomesticpriceofcoffeewithoutinternationaltradeishigherthantheworldpriceofcoffee.Thissuggeststhat a.Guatemalahasacomparativeadvantageoverothercountriesintheproductionofcoffee,andGuatemalawillexportcoffee. b.Guatemalahasacomparativeadvantageoverothercountriesintheproductionofcoffee,andGuatemalawillimportcoffee. c.othercountrieshaveacomparativeadvantageoverGuatemalaintheproductionofcoffee,andGuatemalawillexportcoffee. d.othercountrieshaveacomparativeadvantageoverGuatemalaintheproductionofcoffee,andGuatemalawillimportcoffee. 41.SupposeRussiaexportssunflowerseedstoIrelandandimportscoffeefromBrazil.Thissituationsuggests a.RussiahasacomparativeadvantageoverBrazilinproducingcoffee,andIrelandhasacomparativeadvantageoverRussiainproducingsunflowerseeds. b.RussiahasacomparativeadvantageoverIrelandinproducingsunflowerseeds,andBrazilhasacomparativeadvantageoverRussiainproducingcoffee. […]

  11) The National Bank Act of 1863, and subsequent amendments to it, A) created a banking system of state-chartered banks. B) established the Office of the Comptroller of the Currency. C) broadened the regulatory powers of the Federal Reserve. D) created insurance on deposit accounts.   12) Which regulatory body charters national banks? A) The Federal Reserve B) The FDIC C) The Comptroller of […]

    10.4   Behavioral Economics: Do People Make Their Choices Rationally?   1) What is behavioral economics? A) the study of how people make wealth-maximizing decisions B) the study of how people behave in the face of scarcity C) the study of situations in which people act in ways that are not economically rational D) the study of how people make decisions at the margin […]

  41.Which of the following countries presents a favorable benefit-cost-risk trade-off scenario for foreign expansion?   A. A country ridden by private-sector debt B. A country with a free market system C. A country experiencing a dramatic upsurge in inflation rates D. A country that is heavily populated E. A country that is less developed and politically unstable 42.Which of the following is true of the value that an international business can […]

  21.Whenafree-riderproblemexists, a.themarketwilldevotetoofewresourcestotheproductionofthegood. b.thecostofthegoodwillalwaysbemorethanthebenefitofthegood. c.thegoodwillnotbeproduced. d.entrepreneurswilleventuallyfindawaytomakefree-riderspaytheirshare. 22.Afreeriderproblemariseswhen a.thereareveryfewbeneficiariesandexclusionofanyoneofthemispossible. b.therearemanybeneficiariesandexclusionofanyoneofthemispossible. c.therearemanybeneficiariesandexclusionofanyoneofthemisimpossible. d.thereareveryfewbeneficiariesandtheyalltrytousethegoodsimultaneously. 23.OntheFourthofJuly,thereisnofireworksdisplayinthesmalltownofYankeeville,eventhoughitwouldbeefficientforsuchadisplaytobeproduced.Whichofthefollowingstatementsiscorrect? a.ThelackofafireworksdisplayinYankeevillearisesbecauseofanexternality. b.ThelackofafireworksdisplayinYankeevilleisacaseofmarketfailure. c.IndecidingnottoproduceafireworksdisplayinYankeeville,privateindividualsandprivatefirmsmadedecisionsthatwereprivatelyrationalbutsociallyinefficient. d.Alloftheabovearecorrect. 24.OntheFourthofJuly,thereisnofireworksdisplayinthesmalltownofYankeeville,eventhoughitwouldbeefficientforsuchadisplaytobeproduced.Whichofthefollowingstatementsiscorrect? a.ThelackofafireworksdisplayinYankeevillearisesbecauseofanexternality. b.ThelackofafireworksdisplayinYankeevillearisesbecausethefree-riderproblemdoesnotapplytogoodssuchasfireworksdisplays. c.IndecidingnottoproduceafireworksdisplayinYankeeville,privateindividualsandprivatefirmsmadedecisionsthatwereprivatelyirrational. d.Alloftheabovearecorrect. 25.Publicschools,parks,libraries,androadsarepaidforlargelythroughtaxrevenuebecause a.societyfindsthemsovaluablethatcitizensarehappytopayfortheirfullcost. b.thesegoodscreateafree-riderproblem. c.iftheywerefundedprivately,toomanyofthesegoodswouldbeproduced. d.Alloftheabovearecorrect. 26.Supposethateveryonepreferstoliveinasocietywithoutpoverty.Furthersupposethatsomeprivatecharitiesaresuccessfulinreducingpoverty.Peoplewhodonotcontributetothecharities a.receivenoexternalbenefitfromprivateantipovertyprograms. b.decreasetherelianceofindividualsonantipovertyprograms. c.canfreerideonthegenerosityofothers. d.aremostlikelytobeinfavorofgovernment-sponsoredprograms. 27.MikeMilleristhetownmanagerofMedfield,atownwith50,000residents.Atarecenttownmeeting,severalcitizensproposedbuildingalargepublicswimmingpoolinthecenteroftownforalloftheresidentstoenjoy.Asurveyofall50,000residentsrevealedthatthepoolwouldbeworth$50toeachofthem.Becausethecosttobuildtheswimmingpoolisonly$1,000,000,ManagerMillerarrangestohavethepoolbuilt.Everyoneintownenjoysthepool,butwhenManagerMillerasksfordonationstopayforthepool,heonlycollects$250,000.ManagerMillersoonrealizesthat a.thesurveywasconductedimproperly. b.thecostofthepoolexceededthesocialbenefits. c.thepool is a club good. d.mostresidentsofthetownareprobablyfree-ridersatthepool. 28.MikeMilleristhetownmanagerofMedfield,atownwith50,000residents.Atarecenttownmeeting,severalcitizensproposedbuildingalargepublicswimmingpoolinthecenteroftownforalloftheresidentstoenjoy.Asurveyofall50,000residentsrevealedthatthepoolwouldbeworth$50toeachofthem.Thecosttobuildtheswimmingpoolis$1,000,000.Whichofthefollowingisthemostefficientoption? a.Thepoolshouldbebuiltandpaidforwithdonationscollectedfromresidents,asthesedonationsshouldmorethancoverthecostofthepool. b.Thepoolshouldbebuiltandpaidforbythetowngovernmentandpaidforwithataxontheresidentsbecauseallresidentswouldbenefitfromitbutsomeresidentswouldnotdonateiftheywereasked. c.Thepoolshouldbebuiltandpaidforbythewealthiesttenpercentoftheresidents. d.Thepoolshouldnotbebuiltbecausethesocialvaluedoesnotexceedthecost. 29.Privatemarketsusuallyfailtoprovidelighthousesbecause a.lighthousescosttoomuchtobuildrelativetotheirbenefits. b.governmentinterventionmakesithardforprivatelighthouseownerstocompeteinthemarket. c.shipcaptainshaveincentivestouselighthouseswithoutpaying. d.lighthousesarevaluedverylittlebyshipcaptainsthesedays. 30.Mostlighthousesareoperatedbythegovernmentbecause a.ofthefree-riderproblem. b.lighthousesarenolongervaluedbysociety. c.mostlighthousesareonlytouristattractionsinstateandnationalparks. d.shippingcompanieswouldnotbeabletoaffordmaintenancefeesforlighthouses.    

  51) An important managerial task in global marketing is learning to recognize the extent to which it is possible to extend marketing plans as well as the extent to which adaptation is desired. The way a company addresses this task is a reflection of the company’s: A) market penetration. B) market diversification. C) global marketing strategy. D) product development. E) product standardization. 52) One […]

  71) The above figure shows the market for pizza. The market is in equilibrium. Pizza and tacos are substitutes for consumers. The price of tacos falls. What point represents the most likely new price and quantity? A) A B) B C) C D) D E) E 72) If both the supply and demand curves shift simultaneously, we can always predict what will happen to […]

    81) When setting up a compensation plan for salespeople to encourage them to service accounts, a ________ plan is the best choice. A) straight commission B) combination C) straight salary D) merit   82) Which of the following is a negative aspect of straight-salary sales compensation plans? A) Increase in employee turnover B) Increase of fixed compensation costs C) Complicated to design and […]

    111.What drives a country’s limits to acceptable terms of trade? A. Their opportunity costs B. Whether they possess the absolute advantage in the production of a good C. Both of these statements are true. D. Neither of these statements is true. 112.  Refer to the figure shown, which represents the production possibilities frontiers for Countries A and B. Which of the following statements is true? A. The opportunity […]

    Multiple Choice Questions   1.Portland Supplies Co. mistakenly excluded $3,000 of goods from its December 31, 2015 physical inventory count. Its December 31, 2016 inventory amount was correct. As a result of this error, a.2015 income is overstated by $3,000. b.2015 ending inventory is overstated by $3,000. c.2016 income is overstated by $3,000. d.2016 cost of goods sold is overstated by $3,000.   […]