Which of the following theorems predicts that trade benefits the abundant factors of a country and harms the scarce factors? A) The Stolper-Samuelson theorem. B) The Rybczynski theorem. C) The Heckscher-Ohlin theorem. D) None of the above. ANSWER A
Date: September 10th, 2020
The primary interest of firms engaging in offshoring is to find lower wages and to decrease production costs. Indicate whether the statement is true or false ANSWER FALSE
Date: September 10th, 2020
How do recent current account deficits compare to GNP and to past ratios? What will be an ideal response? ANSWER It is over 6 percent of GNP, much larger than it has been in the past, and the percentage has grown sharply over the last few years.
Date: September 10th, 2020
The way in which a country grows affects the pattern of trade of a country. True or false. Discuss. What will be an ideal response? ANSWER Growth causes a country’s PPF to shift out. This has implications for both production and consumption. Since trade is the difference between production and consumption, it will tend […]
Date: September 10th, 2020
Which trade strategy have developing countries used to restrict imports of manufactured goods so that the domestic market is preserved for home producers? A) international commodity agreement B) export promotion C) multilateral contract D) import substitution E) export subsidies ANSWER D
Date: September 10th, 2020
An imperfectly competitive firm has the following demand curve: Q = 100 – 2P. What is marginal revenue equal to when P = 30? What will be an ideal response? ANSWER Q = 40, so MR = 30 – (40/2 ) = 10.
Date: September 10th, 2020
Given the information in the table above, Home’s opportunity cost of cloth is A) 0.5. B) 2.0. C) 6.0. D) 1.5. E) 3.0. ANSWER A
Date: September 10th, 2020
Adopting the Single European Act had broad popular support; the Treaty on European Union was more controversial. Indicate whether the statement is true or false ANSWER TRUE
Date: September 10th, 2020
Which of the following is true about the distribution of income in the U.S. in the last three decades? A) For much of this period real wages paid to college graduates have risen significantly. B) Real wages paid to blue-collar workers have grown only slightly. C) There has been a shift in the distribution in […]
Date: September 10th, 2020
The existence of positive externalities due to the impossibility of full appropriability A) supports the conclusions of the Heckscher-Ohlin model. B) rejects the usefulness of government protectionism. C) supports the concept that the government should support only high-tech industries. D) provides support for government protectionism. E) supports arguments for free trade. ANSWER D
Date: September 10th, 2020
