EBK MACROECONOMICS FOR TODAY
9th Edition
ISBN: 8220101425966
Author: Tucker
Publisher: CENGAGE L
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Question
Chapter 18, Problem 1SQ
To determine
The production possibilities for two nations.
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Each country should specialize in producing that good for which it
a. has a comparative advantage
b. has an absolute advantage
c. it has a higher opportunity cost
Countries need to trade because--------.
Select one:
a. world resources are unevenly distributed among countries
b. world resources are evenly distributed among countries
c. all products are made from the same combinations of resources
d. all products are produced from the same technology
We have shown that all individuals and countries can gain from trade. What are some of the reasons why some individuals or countries may object to free trade? Select all that apply.
Multiple answers:Multiple answers are accepted for this question
a International trade increases susceptibility to global shocks.
b Some individuals may lose their job or business as a result of competition from abroad.
c International trade can result in greater specialization and therefore higher production and consumption by both countries.
d Higher competition as a result of international trade may hurt consumers.
Part b:
Imagine that the U.S. establishes a tariff on an imported good. Under which of the following situations would the U.S. consumers have to pay a larger proportion of the tariff?
a If demand for the imported good is relatively inelastic.
b If demand for the imported good is relatively elastic.
c If demand for the imported good is infinitely elastic.
d The incidence…
Chapter 18 Solutions
EBK MACROECONOMICS FOR TODAY
Ch. 18.4 - Prob. 1GECh. 18.6 - Prob. 1GECh. 18 - Prob. 1SQPCh. 18 - Prob. 2SQPCh. 18 - Prob. 3SQPCh. 18 - Prob. 4SQPCh. 18 - Prob. 5SQPCh. 18 - Prob. 6SQPCh. 18 - Prob. 7SQPCh. 18 - Prob. 8SQP
Ch. 18 - Prob. 9SQPCh. 18 - Prob. 10SQPCh. 18 - Prob. 11SQPCh. 18 - Prob. 1SQCh. 18 - Prob. 2SQCh. 18 - Prob. 3SQCh. 18 - Prob. 4SQCh. 18 - Prob. 5SQCh. 18 - Prob. 6SQCh. 18 - Prob. 7SQCh. 18 - Prob. 8SQCh. 18 - Prob. 9SQCh. 18 - Prob. 10SQCh. 18 - Prob. 11SQCh. 18 - Prob. 12SQCh. 18 - Prob. 13SQCh. 18 - Prob. 14SQCh. 18 - Prob. 15SQCh. 18 - Prob. 16SQCh. 18 - Prob. 17SQCh. 18 - Prob. 18SQCh. 18 - Prob. 19SQCh. 18 - Prob. 20SQ
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- Which of the following is a benefit of free trade? A. It reduces employment in many fields. B. It makes more diverse products available. C. It causes industries to decline. D. It makes countries dependent on foreign powers.arrow_forwardAlexandra’s Production Possibilities Schedule Natalia’s Production Possibilities Schedule Number of Scarves Knitted per Hour Number of Sweaters Knitted per Hour Number of Scarves Knitted per Hour Number of Sweaters Knitted per Hour 0 4 0 4 3 3 2 3 6 2 4 2 9 1 6 1 12 0 8 0 If Natalia were to export a good, which one(s) would she export?arrow_forwardWhich of the following statements about international trade is true? Answers: A. On a global scale imports must equal exports. B. Typically, countries with a large GDP experience a trade surplus. C. With trade, world consumption possibilities decrease. D. On a global scale, exports are greater than imports.arrow_forward
- We see quite a bit of international trade in the real world. And trade is driven by specialization. So why don’t we see full specialization—for instance, all cars in the world being made in South Korea, or all the mobile phones in the world being made in China? Choose the best answer from among the following choices. a. High tariffs. b. Extensive import quotas c. Increasing opportunity costs. d. Increasing returns.arrow_forwardWhat is meant by the concept of "trade creation"? a. Inefficient trade that follows the establishment of a free - trade area. b. Trade based on comparative advantage that typically follows the reduction of trade barriers. C. The opening up of new trading routes. d. Regional trade agreements. e. Increased exports and reduced imports as a result of a high-tariff policy.arrow_forwardAccording to the theory of comparative advantage, countries gain from trade because ___a. trade makes firms behave more competitively, reducing their market power. ___b. all firms can take advantage of cheap labor. ___c. output per worker in each firm increases. ___d. world output can rise when each country specializes in what it does relatively best. ___e. every country has an absolute advantage in producing something.arrow_forward
- American and Japanese workers can each produce 4 cars a year. An American worker can produce 10 tons of grain a year, whereas a Japanese worker can produce 5 tons of grain a year. Each country has 100 million workers Who has a comparative advantage in the production of cars? What is the opportunity cost for cars?arrow_forward. The mercantilists maintained that: a. Trade benefits one nation only at the expense of another nation b. Government control of trade leads to maximum economic welfare C. All nations can gain from free international trade d. The world's output of goods must remain constant over time e. None of the abovearrow_forwardWhy don't countries specialize in the production of just a few goods for which they have a comparative advantage? a. In most cases, increasing opportunity costs would accompany the continually increasing production of a product specialist. b. In most cases, resource drains would accompany the continually increasing production of a product specialist. c. Doing so would limit innovation in other industries. d. Doing so would limit innovation in the core industries, because there would be little incentive for it.arrow_forward
- Please correct and incorrect answer explanation Countries that restrict foreign trade are likely to a. have more firms with domestic market power. b. forgo the additional surplus that trade allows, but will be compensated by a higher rate of technological change. c. forgo the additional surplus that trade allows, but will have a lower rate of unemployment. d. forgo the additional surplus that trade allows, but will probably enjoy economies of scale. Note:- Please don't simply copy and paste content from other AI tools or bots, or else I may have to downvote your actions. Do not provide the handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism.Answer completely.arrow_forwardWhich of the following is international trade? a. Trade between regions b. Both (b) and (c) c. Trade between provinces d. Trade between countriesarrow_forwardExplain how two countries trading with which other gain from economic trade or mercantilism.arrow_forward
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