An important function of international institutions during times of crisis is to
A) make goods nonrival.
B) make goods nonexcludable.
C) prevent free riding.
D) prevent nondiscrimination.
E) encourage free riding.
Question 2 - One of the outcomes of the Uruguay Round is the formation of the World Trade Organization now sets new trade rules and has more power than the old GATT to enforce the rules it sets.
Indicate whether the statement is true or false
Question 3 - If the autarky price of S (in terms of T) were lower in country A than in country B,
A) A has a comparative advantage in S.
B) B has a comparative advantage in T.
C) A has a comparative disadvantage in T.
D) All of the above.
Question 4 - If a nation protects an industry because it believes that there are positive externalities in the production process, it is asserting that the free market will
A) produce less than is optimal from society's point of view.
B) produce more than is optimal from society's point of view.
C) produce the correct amount but charge too high a price.
D) produce the correct amount but charge too low a price.
E) None of the above.
Question 5 - If a good or service does not get used up as it is consumed, then it is said to be
A) nonexcludable.
B) nonrival.
C) nondiscrimination.
D) nonconsumable.
E) None of the above.
Question 6 - If the autarky price of S were lower in country A than in country B, then if trade were allowed
A) A would likely export S to B.
B) A would likely import S from B.
C) neither country would want to trade.
D) None of the above.
Question 7 - Many developing countries make the government budget one of the primary tools of long-run industrial development, with the government owning and operating industries such as steel mills, airlines, and phone companies.
Indicate whether the statement is true or false
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