Economics (McConnell), 18th Edition

Chapter 5: The United States in the Global Economy

Quiz

1
Over the past several years, the volume of world trade has:
A)decreased because of increased government regulation of trade through tariffs and quotas
B)decreased because of the decline in incomes brought on by global recession
C)increased because of increased government regulation of trade through tariffs and quotas
D)increased because of improvements in communications and transportation
2
A tariff:
A)raises the price of imported goods, increasing the demand for domestic substitutes
B)lowers the cost of producing domestic goods
C)offsets the effect of a quota
D)raises the price of domestic goods, lowering the demand for them
3
U.S. exports:
A)average 4-6 percent of GDP, as do imports
B)average 18-20 percent of GDP, while imports average 10-12 percent
C)average 10-12 percent of GDP, while imports average 15-17 percent
D)average 1-2 percent of GDP, while imports average 4-6 percent
4
A government agency requires that all agricultural goods entering the country undergo an unduly long inspection process to assure product quality. This is an example of:
A)an export subsidy
B)a tariff
C)a nontariff barrier
D)a quota
5
Which of the following will tend to increase U.S. exports to Mexico and reduce Mexican exports to the U.S.?
A)A decrease in the dollar price of the peso
B)An appreciation of the dollar relative to the peso
C)A depreciation of the peso relative to the dollar
D)An increase in the dollar price of the peso
6
Answer the next question on the basis of the following production possibilities tables for countries Alpha and Beta:

<a onClick="window.open('/olcweb/cgi/pluginpop.cgi?it=jpg::::/sites/dl/free/0025694212/627562/q6.jpg','popWin', 'width=NaN,height=NaN,resizable,scrollbars');" href="#"><img valign="absmiddle" height="16" width="16" border="0" src="/olcweb/styles/shared/linkicons/image.gif"> (15.0K)</a>

In Beta, the domestic opportunity cost of one unit of good X is:
A)1 unit of Y
B)1.5 units of Y
C)2 units of X
D)3 units of Y
7
Answer the next question on the basis of the following production possibilities tables for countries Alpha and Beta:

<a onClick="window.open('/olcweb/cgi/pluginpop.cgi?it=jpg::::/sites/dl/free/0025694212/627562/q6.jpg','popWin', 'width=NaN,height=NaN,resizable,scrollbars');" href="#"><img valign="absmiddle" height="16" width="16" border="0" src="/olcweb/styles/shared/linkicons/image.gif"> (15.0K)</a>

According to the concept of comparative advantage:
A)Alpha should specialize in the production of X; Beta in the production of Y
B)Alpha should produce some of both goods X and Y
C)Beta should produce some of both goods X and Y
D)Beta should specialize in the production of X; Alpha in the production of Y
8
Two nations, Gamma and Delta, both produce shoes and dresses. Gamma has a comparative advantage in the production of shoes if:
A)it can produce shoes with fewer resources than Delta
B)its domestic opportunity cost of shoes in terms of dresses is lower than Delta's
C)its supply of shoes is greater than Delta's
D)it is wealthier than Delta
9
A decrease in the U.S. demand for Mexican goods will:
A)increase the demand for the peso and increase its dollar price
B)increase the supply of the peso and decrease its dollar price
C)decrease the supply of the peso and increase its dollar price
D)decrease the demand for the peso and decrease its dollar price
10
One major outcome of the North American Free Trade Agreement is:
A)massive investment by Asian companies in Mexico to exploit reduced tariffs
B)increased unemployment in Mexico
C)higher average living standards in Canada, Mexico, and the U.S.
D)reduced exports from the U.S. to Mexico and Canada
Glencoe Online Learning CenterSocial Studies HomeProduct InfoSite MapContact Us

The McGraw-Hill CompaniesGlencoe

Please read our Terms of Use and Privacy Notice before you explore our Web site. To report a technical problem with this Web site, please contact the Web Producer.