International free trade always hurts the nations that run deficits, and benefits the nations that run surpluses. Indicate whether the statement is true or false ANSWER FALSE
It is possible for every nation to have BOP surpluses. Indicate whether the statement is true or false ANSWER FALSE
The HPAE “economic miracle” illustrates a clear case in which A) exports and growth were positively related. B) exports were promoted by successful economic growth. C) economic growth was determined by successful export promotion. D) trade policy dominated other considerations in promoting economic growth. E) import substitution enhanced economic development. ANSWER A
At the end of the populist cycle, workers are better off than they were before the populist cycle began in terms of real wages and job creation. Indicate whether the statement is true or false ANSWER FALSE
According to Linder, the gains from international trade come about because consumers are exposed to A) a greater variety of goods. B) increasing returns to scale. C) imperfect competition. D) None of the above. ANSWER A
The Shipbreakers of Alang represent a perfect example of how a developing country can apply the principles of the Heckscher-Ohlin model, since A) shipbreaking is generally considered to be a capital-intensive operation and India, being a large country has much capital. B) shipbreaking is a labor-intensive operation in India, and India has many workers since […]
What policies would you recommend to the U.S. government to lower the balance of trade deficit and decrease net capital inflows? What will be an ideal response? ANSWER Lower the fiscal deficit.
Who are the major participants in the foreign exchange market? What will be an ideal response? ANSWER (1 ) Commercial banks (2 ) Corporations (3 ) Nonbank financial institutions (4 ) Central banks
The “East Asian Miracle” of the “Four Tigers” in the 1960s was replicated by A) developing countries around the world. B) other East Asian countries. C) Sub Sahara African countries. D) Industrialized countries. E) Eastern European countries. ANSWER B
If the United States and Mexico trade Budweiser for Modelo beer, what type of trade does this represent? What will be an ideal response? ANSWER Intraindustry