Essentials of Economics (MindTap Course List)
8th Edition
ISBN: 9781337091992
Author: N. Gregory Mankiw
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Question
Chapter 3, Problem 7PA
Subpart (a):
To determine
The value of X to determine the
Subpart (b):
To determine
The value of X to determine export quantity of cars and import quantity of wine.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
A German worker takes 400 hours to produce a carand 2 hours to produce a case of wine. A Frenchworker takes 600 hours to produce a car and X hoursto produce a case of wine.a. For what values of X will gains from trade bepossible? Explain.b. For what values of X will Germany export carsand import wine? Explain.
Suppose that in the next few years Saudi Arabia oil
production increases significantly.
a. How will this influence the term-of-trade and
welfare of Japan that is an oil importer? Explain.
b. How will the terms-of-trade and welfare change
in Kuwait that is an oil exporter? Explain.
I attached the graph to this question.
1. If trade is avoided, Spain consumes _____ wrenches at a price of _____ per wrench.
2. With free trade, for a world price of $4 per wrench, Spain is producing _____wrenches.
3. With free trade, for a world price of $4 per wrench, Spain is consuming _______ wrenches.
4. With free trade, for a world price of $4 per wrench, Spain is importing _________wrenches.
5. If the world price is $4 per wrench, and the government of Spain imposes a tariff of $2, Spain produces ____________ and imports __________wrenches.
6. If the world price is $4 per wrench, and the government of Spain imposes a tariff of $2, how much tariff revenue will the Spain’s government collect?
Chapter 3 Solutions
Essentials of Economics (MindTap Course List)
Knowledge Booster
Similar questions
- If the U.S. did not trade what price would the good cost? If the world price was $200 what quantity would the U.S. produce? What quantity would be imported. What is consumer surplus at the world price? Producer surplus at the world price? Who benefits from the free trade and who gets hurt If the U.S. government puts a tariff on the good so now the price is $300 who benefits, who is hurt? What quantity will U.S. producers now produce? What happens to consumer surplus from $200 to $300? What does producer surplus do with the price going from $200 to $300? What does the government gain with the tariff? Who benefits from free trade overall? Who benefits from trade restrictions? Why is a tariff the most used trade restriction?arrow_forwardSuppose that in the United States, producing an aircraft takes 10,000 hours of labor and producing a shirttakes 2 hours of labor. In China, producing an aircrafttakes 40,000 hours of labor and producing a shirttakes 4 hours of labor. What will these nations trade?a. China will export aircraft, and the United Stateswill export shirts.b. China will export shirts, and the United States willexport aircraft.c. Both nations will export shirts.d. There are no gains from trade in this situation.arrow_forwardWhat is the benefit of international trade. Answer in reference to the USarrow_forward
- 3. Two areas, Europe and America, can produce only goods A and B, under constant costs as indicated below. What will be the result of free trade between the two areas? In Europe In America 1 unit of good A 2 hours of labor 3 hours of labor 1 unit of good B 4 hours of labor 5 hours of labor a. Europe will export A and B to America. b. Europe will import A and export B. c. Europe will import B and export A. d. Europe will import A and B from America. e. No trade will take place.arrow_forwardIf the United States produces 8 automobiles and Canada produces 2 automobiles and the United States produces 8 units of lumber and Canada produces 4 units of lumber, should the U. S. trade with Canada? If so, what should be imported and what should be exported?arrow_forwardComplete the following sentence. Quotas, as they relate to global trade, are:Choose one answer.a. limits on exports. b. a complete ban of imports. c. taxes on imports. d. political weapons.arrow_forward
- A country will gain relatively more from trade when: A. trade is regulated. B. the world price is below the country's opportunity cost of the good. C. the world price is close to the country's opportunity cost of the good. D. the world price is much greater than the country's opportunity cost for the good.arrow_forwardRefer to the figure regarding countries A and B. If each country allocated half of its labor force to the production of each good before trade and then each specialize in their comparative advantage and allocate 75 percent of its labor force to the production of that good, world production of good X would change by -- and production of good Y by- Good Y 100 Country B Good X 80 Country A 40 100arrow_forward1. If trade is avoided, Spain consumes _____ wrenches at a price of _____ per wrench. 2. With free trade, for a world price of $4 per wrench, Spain is producing _____wrenches. 3. With free trade, for a world price of $4 per wrench, Spain is consuming _______ wrenches.arrow_forward
- a. If trade is avoided, Spain consumes _____ wrenches at a price of _____ per wrench. b. With free trade, for a world price of $4 per wrench, Spain is producing _____wrenches. c. With free trade, for a world price of $4 per wrench, Spain is consuming _______ wrenches. d. With free trade, for a world price of $4 per wrench, Spain is importing _________wrenches. e. If the world price is $4 per wrench, and the government of Spain imposes a tariff of $2, Spain produces ____________ and imports __________wrenches. f. If the world price is $4 per wrench, and the government of Spain imposes a tariff of $2, how much tariff revenue will the Spain’s government collect? _____arrow_forward4. With free trade, for a world price of $4 per wrench, Spain is importing ________ wrenches. 5. If the world price is $4 per wrench, and the government of Spain imposes a tariff of $2, Spain produces ______________ and imports ______________ wrenches. 6. If the world price is $4 per wrench, and the government of Spain imposes a tariff of $2, how much tariff revenue will the Spain's government collect? __________arrow_forwardPredict what each of the following events would do to the terms of trade of the importing country and the exporting country, other things being equal. a. A blight destroys a large part of the coffee beans produced in the world. There will be favourable change in the terms of trade of coffee exporters, unfavourable change for coffee importers. b. The Koreans cut the price of the steel they sell to Canada. There will be favourable change in the terms of trade for Canada and unfavourable change in the terms of trade for Korea. c. General inflation of 4 percent occurs around the world. There will be unpredictable change in the terms of trade for the importing country and unpredictable change in the terms of trade for the exporting country. d. Violation of OPEC output quotas leads to a sharp fall in the price of oil. There will be change in terms of trade for oil exporters, and change in terms of trade for oil importers. unpredictable unfavourable favourablearrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Essentials of Economics (MindTap Course List)EconomicsISBN:9781337091992Author:N. Gregory MankiwPublisher:Cengage Learning
Brief Principles of Macroeconomics (MindTap Cours...EconomicsISBN:9781337091985Author:N. Gregory MankiwPublisher:Cengage Learning
Essentials of Economics (MindTap Course List)
Economics
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:Cengage Learning
Brief Principles of Macroeconomics (MindTap Cours...
Economics
ISBN:9781337091985
Author:N. Gregory Mankiw
Publisher:Cengage Learning