Question 1

A country has a comparative advantage in the production of any good that it can produce

Accepted Answer

A country has a comparative advantage if it can produce a certain good at a lower opportunity cost than other countries. Opportunity cost refers to the cost of a particular decision in terms of the best alternative that must be given up. If a country can produce a certain good with a smaller sacrifice of some alternative good or service than other countries, then it has a comparative advantage in that good. The other choices are incorrect because comparative advantage is not based on absolute cost or labor input alone, nor is it limited to goods produced for export; it is about opportunity cost.

Question 2

The Following Questions Refer to the graph below. 
-If this country has a comparative advantage in the production of bread and produces only bread while trading with another country for milk,which of the following is true of its consumption possibilities curve?

Accepted Answer

If the country specializes in producing bread and trades for milk, their production of bread will increase, causing an outward shift of the production possibility curve (PPC) parallel to the original curve. However, since they are trading for milk, their consumption of milk will also increase. This will cause the horizontal intercept of the consumption possibilities curve to shift further to the right. The vertical intercept should remain the same since their production of bread did not change their ability to produce milk domestically. Therefore, only choice C is true.

Question 3

Which of the following will give rise to U.S.demand for foreign exchange?

Accepted Answer

U.S. investments abroad require purchase of foreign currency, which leads to demand for foreign exchange. Similarly, U.S. purchases of French perfume require the exchange of U.S. dollars for foreign currency, leading to demand for foreign exchange. U.S. sales of airplanes to Japanese buyers, on the other hand, involve the exchange of Japanese currency for U.S. dollars, leading to supply of foreign exchange, not demand.

Question 4

The Following Questions Refer to the graph below. 
-If this country has a comparative advantage in the production of milk and produces only milk while trading with another country for bread,which of the following is true of its consumption possibilities curve?

Accepted Answer

The answer of The Following Questions Refer to the graph...

Question 5

The Following Questions Refer to the graph below. 
-Without trade,the Republic of Alpha's production possibilities curve is AB.The cost of producing bread in Alpha (in terms of millions of gallons of milk)is

Accepted Answer

The cost of producing bread in terms of milk is determined by the slope of the production possibilities curve. If the curve is linear, the slope indicates the opportunity cost. Here, the cost is 2 million gallons of milk per unit of bread.

Question 6

The Following Questions Refer to the graph below. -Without trade,the Republic of Alpha's production possibilities curve is AB.If consumption along the curve A₁B is possible with trade,Alpha must have a comparative advantage in the production of

Accepted Answer

The answer of The Following Questions Refer to the graph...

Question 7

The Following Questions Refer to the graph below. 
-Without trade,the Republic of Alpha's production possibilities curve is AB.For Alpha to be willing to trade milk for bread,a million loaves of bread would have to cost less than

Accepted Answer

The answer of The Following Questions Refer to the graph...

Question 8

Which of the following is not used as a protectionist argument?

Accepted Answer

Imports raising living standards above what they would otherwise be is not used as a protectionist argument. Protectionists argue that imports harm domestic industries and employment, while free traders argue that imports benefit consumers by offering a wider variety of goods at lower prices. The argument that imports raise living standards is typically made by free traders.

Question 9

The Following Questions Refer to the graph below. 
-The opportunity cost of a million loaves of bread is how many millions of gallons of milk for this country?

Accepted Answer

Point C represents the country achieving its maximum possible production given its resources. At this point, the country can produce 2 million gallons of milk and 1 million loaves of bread. This is the most efficient use of resources and therefore the best choice. Choosing any other point would result in sacrificing some productivity in one of the goods for the other.

Question 10

The fundamental reason countries engage in trade is that

Accepted Answer

The fundamental reason countries engage in trade is to improve their standard of living. By trading with other countries, they can access goods and services that they cannot produce themselves or can produce at a higher cost, and specialize in producing goods and services they are more efficient at, thus resulting in a more diverse and prosperous economy. Domestic markets may shrink in some cases, but this is not the primary reason for trade. Special interest groups may benefit, but this is not the overarching reason for countries to engage in trade. Saving resources is a potential outcome of trade, but it is not the core reason.

Question 11

Which of the following is not a reason that countries have comparative advantages in the production of some goods and comparative disadvantages in the production of other goods? Differences in

Accepted Answer

Exchange rates are a factor that affects the relative prices of goods and services in different countries, but they do not directly influence a country's ability to produce certain goods more efficiently than others. The other factors listed, such as technological know-how, natural resources, labor force quality, and literacy rates, can create comparative advantages or disadvantages in production.

Question 12

The Following Questions Refer to the graph below. 
-The opportunity cost of a million gallons of milk is how many millions of loaves of bread for this country?

Accepted Answer

The opportunity cost of a million gallons of milk is the number of loaves of bread that could have been produced with the same resources. Since 1 gallon of milk can be used to produce 2 loaves of bread, the opportunity cost of a million gallons of milk is 2 million loaves of bread.

Question 13

The Following Questions Refer to the graph below. 
-Without trade,the Republic of Alpha's production possibilities curve is AB.With no trade,Alpha's consumption possibilities curve is

Accepted Answer

Without trade, a country's production possibilities curve also represents its consumption possibilities curve, as it can only consume what it can produce.

Question 14

Omega can produce either two microcomputers or ten TV sets.Alpha can produce one microcomputer or five TV sets.Which of the following statements is correct?

Accepted Answer

Both countries have the same opportunity cost for producing microcomputers and TV sets, so there is no comparative advantage, making trade unlikely.

Question 15

Which of the following is part of the "protectionist" perspective on international trade?

Accepted Answer

Protectionist perspectives on international trade include the belief that imports can crowd out domestic goods and reduce jobs, that trade restrictions are necessary to protect industries vital to national security, and that imports should be restricted to remedy trade deficits.

Question 16

In a free market,who benefits from voluntary exchange?

Accepted Answer

In a free market, both buyers and sellers benefit from voluntary exchange. Buyers benefit by receiving goods or services that they value more than the money they paid for them, while sellers benefit by receiving money that they value more than the goods or services they sold. Both parties involved in the exchange voluntarily engage in the transaction because they both believe it will make them better off. This mutual benefit is the foundation of free market economics.

Question 17

The Following Questions Refer to the graph below. -If Alpha produces 100 million loaves of bread,with trade (and consumption possibilities curve A₁B)it can consume how many gallons of milk?

Accepted Answer

Point C (300 gallons of milk, 100 million loaves of bread) is the highest point on the production possibilities frontier (PPF). Any point beyond that is not attainable given the current resources and technology. Therefore, consuming 300 gallons of milk is the best choice for Alpha if it produces 100 million loaves of bread.

Question 18

Which of the following statements is most accurate?

Accepted Answer

According to the statement, "Since the late 1940s, import restrictions have fallen." The other statements are either incomplete or inaccurate.

Question 19

The Following Questions Refer to the graph below. 
-Assuming an initial combination of 75 million loaves of bread and 150 million gallons of milk, the country represented would refuse to enter into any trade relationships in which the cost of importing

Accepted Answer

The answer of The Following Questions Refer to the graph...

Question 20

Why is international trade important? International trade

Accepted Answer

International trade provides numerous benefits for a nation's economy. It increases the variety and availability of consumer goods, expands production possibilities by allowing nations to specialize in certain goods according to comparative advantage, and ultimately increases the GDP of a nation. Therefore, option (E) is the correct answer as it includes all of the mentioned benefits of international trade.

Quiz 10: Competition in the Global Market-Place: Should We Protect Ourselves From International Trade

A country has a comparative advantage in the production of any good that it can produce

The Following Questions Refer to the graph below. -If this country has a comparative advantage in the production of bread and produces only bread while trading with another country for milk,which of the following is true of its consumption possibilities curve?

Which of the following will give rise to U.S.demand for foreign exchange?

The Following Questions Refer to the graph below. -If this country has a comparative advantage in the production of milk and produces only milk while trading with another country for bread,which of the following is true of its consumption possibilities curve?

The Following Questions Refer to the graph below. -Without trade,the Republic of Alpha's production possibilities curve is AB.The cost of producing bread in Alpha (in terms of millions of gallons of milk) is

The Following Questions Refer to the graph below. -Without trade,the Republic of Alpha's production possibilities curve is AB.If consumption along the curve A₁B is possible with trade,Alpha must have a comparative advantage in the production of

The Following Questions Refer to the graph below. -Without trade,the Republic of Alpha's production possibilities curve is AB.For Alpha to be willing to trade milk for bread,a million loaves of bread would have to cost less than

Which of the following is not used as a protectionist argument?

The Following Questions Refer to the graph below. -The opportunity cost of a million loaves of bread is how many millions of gallons of milk for this country?

The fundamental reason countries engage in trade is that

Which of the following is not a reason that countries have comparative advantages in the production of some goods and comparative disadvantages in the production of other goods? Differences in

The Following Questions Refer to the graph below. -The opportunity cost of a million gallons of milk is how many millions of loaves of bread for this country?

The Following Questions Refer to the graph below. -Without trade,the Republic of Alpha's production possibilities curve is AB.With no trade,Alpha's consumption possibilities curve is

Omega can produce either two microcomputers or ten TV sets.Alpha can produce one microcomputer or five TV sets.Which of the following statements is correct?

Which of the following is part of the "protectionist" perspective on international trade?

In a free market,who benefits from voluntary exchange?

The Following Questions Refer to the graph below. -If Alpha produces 100 million loaves of bread,with trade (and consumption possibilities curve A₁B) it can consume how many gallons of milk?

Which of the following statements is most accurate?

The Following Questions Refer to the graph below. -Assuming an initial combination of 75 million loaves of bread and 150 million gallons of milk, the country represented would refuse to enter into any trade relationships in which the cost of importing

Why is international trade important? International trade

Quiz 10: Competition in the Global Market-Place: Should We Protect Ourselves From International Trade

A country has a comparative advantage in the production of any good that it can produce

The Following Questions Refer to the graph below. -If this country has a comparative advantage in the production of bread and produces only bread while trading with another country for milk,which of the following is true of its consumption possibilities curve?

Which of the following will give rise to U.S.demand for foreign exchange?

The Following Questions Refer to the graph below. -If this country has a comparative advantage in the production of milk and produces only milk while trading with another country for bread,which of the following is true of its consumption possibilities curve?

The Following Questions Refer to the graph below. -Without trade,the Republic of Alpha's production possibilities curve is AB.The cost of producing bread in Alpha (in terms of millions of gallons of milk) is

The Following Questions Refer to the graph below. -Without trade,the Republic of Alpha's production possibilities curve is AB.If consumption along the curve A1B is possible with trade,Alpha must have a comparative advantage in the production of

The Following Questions Refer to the graph below. -Without trade,the Republic of Alpha's production possibilities curve is AB.For Alpha to be willing to trade milk for bread,a million loaves of bread would have to cost less than

Which of the following is not used as a protectionist argument?

The Following Questions Refer to the graph below. -The opportunity cost of a million loaves of bread is how many millions of gallons of milk for this country?

The fundamental reason countries engage in trade is that

Which of the following is not a reason that countries have comparative advantages in the production of some goods and comparative disadvantages in the production of other goods? Differences in

The Following Questions Refer to the graph below. -The opportunity cost of a million gallons of milk is how many millions of loaves of bread for this country?

The Following Questions Refer to the graph below. -Without trade,the Republic of Alpha's production possibilities curve is AB.With no trade,Alpha's consumption possibilities curve is

Omega can produce either two microcomputers or ten TV sets.Alpha can produce one microcomputer or five TV sets.Which of the following statements is correct?

Which of the following is part of the "protectionist" perspective on international trade?

In a free market,who benefits from voluntary exchange?

The Following Questions Refer to the graph below. -If Alpha produces 100 million loaves of bread,with trade (and consumption possibilities curve A1B) it can consume how many gallons of milk?

Which of the following statements is most accurate?

The Following Questions Refer to the graph below. -Assuming an initial combination of 75 million loaves of bread and 150 million gallons of milk, the country represented would refuse to enter into any trade relationships in which the cost of importing

Why is international trade important? International trade

The Following Questions Refer to the graph below. -Without trade,the Republic of Alpha's production possibilities curve is AB.If consumption along the curve A₁B is possible with trade,Alpha must have a comparative advantage in the production of

The Following Questions Refer to the graph below. -If Alpha produces 100 million loaves of bread,with trade (and consumption possibilities curve A₁B) it can consume how many gallons of milk?