The quantity supplied by domestic producers in an importing country must be less than the quantity demanded by its population.
a. True
b. False
Indicate whether the statement is true or false
Question 2Which of the following lists gives world exports in the order of their value, from highest to lowest?
a. Aircraft, motor vehicle parts, crude petroleum
b. Aircraft, crude petroleum, motor vehicle parts
c. Crude petroleum, office and telecom equipments, automotive parts
d. Motor vehicle parts, aircraft, crude petroleum
e. Motor vehicle parts, crude petroleum, aircraft
Question 3Health insurance is subject to
a. Both asymmetric information problems and moral hazard problems
b. Neither asymmetric information problems nor moral hazard problems
c. Asymmetric information problems but not moral hazard problems
d. moral hazard problems but not asymmetric information problems
Question 4Import quotas contribute to higher prices of products imported into the U.S., but tariffs do not.
a. True
b. False
Indicate whether the statement is true or false
Question 5Which of the following factors are least likely to affect what countries end up trading in the international market?
a. International trade tariffs
b. Government debt levels
c. Comparative advantages
d. Differences in tastes
e. Different technological needs
Question 6A warranty offered by a seller is one way to overcome:
a. A warranty offered by a seller is one way to overcome:.
b. a negative externality problem.
c. an adverse selection problem.
d. a free-rider problem.
Question 7A country that is half as productive at producing some goods as another country, but is one quarter as productive at producing others, will not be able to gain from trade.
a. True
b. False
Indicate whether the statement is true or false
Question 8The most heavily traded category of goods in the world is:
a. office and telecom equipment.
b. chemicals.
c. iron and steel.
d. textiles.
e. crude petroleum.
Question 9Sellers may choose not to sell in certain markets because:
a. it is possible to practice price discrimination against customers.
b. buyers are unable to perceive the high quality of their goods and are, therefore, less willing to pay for them.
c. they are able to impose negative externalities on third parties.
d. an above-average profit potential is projected.
Question 10Trade occurs when a country has an absolute advantage and not just a comparative advantage over another country.
a. True
b. False
Indicate whether the statement is true or false
Question 11Countries tend to export different goods and services because of:
a. differences in their comparative advantages.
b. differences in tastes and technological needs.
c. differences in income.
d. similarities in resource endowment.
e. differences in the exchange rates.
Question 12Socially inefficient outcomes may occur in markets where there are:
a. negative externalities present.
b. asymmetric information problems present.
c. positive externalities present.
d. any of the above.
Question 13A country has an absolute advantage over another if it can produce a good with fewer resources.
a. True
b. False
Indicate whether the statement is true or false
Question 14Which of the following counties are largely dependent on trade with the United States?
a. China and Japan
b. U.K. and Germany
c. Canada and Mexico
d. France and Belgium
e. Canada and U.K
Question 15Consumers will willingly make less-informed decisions:
a. if information costs are less than the perceived benefits of gathering information.
b. if information costs are greater than the perceived benefits of gathering information.
c. since ignorance always leads to bliss.
d. whenever acquiring more information requires sacrifice.
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