Economics MCQs

Page No. 371

International trade tends to cause welfare losses to at least some groups in a country ?


aThe less mobile the country’s resources

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bThe more mobile the country’s resources

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cThe lower the country’s initial living standard

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dThe higher the country’s initial living standard

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Free traders maintain that an open economy is advantageous is that it provides all of the following except ?


a Increased competition for world producers

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bA wider selection of products for consumers

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cThe utilization of the most efficient production methods

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dRelatively high wages levels for all domestic workers

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For the United states, exports plus imports are about _____ of its gross national product?


a5 percent

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b10 percent

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c 25 percent

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d55 percent

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View Answer 25 percent

The largest amount of trade with the United States in recent years has been conducted by ?


aCanada

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bGermany

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cMexico

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dUnited Kingdom

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View Answer Canada

Arguments for free trade are sometimes disregarded by politicians because ?


aMaximizing domestic efficiency is not considered imports

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bMaximizing consumer welfare may not be a chief priority

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cThere exist sound economic reasons for keeping one’s economy isolated from other economies

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dEconomists tend to favor high protected domestic markets

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The movement to free international trade is most likely to generate short-term unemployment in which industries ?


a Industries in which there are neither imports nor exports

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bImports competing industries

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cIndustries that sell to domestic and foreign buyers

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dIndustries that sell to only foreign buyers

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If a nation has an open economy it means that the nation ?


a Allows private ownership of capital

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bHas flexible exchange rates

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cHas fixed exchange rates

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dconducts trade with other countries

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A main advantage of specialization results from ?


aEconomies of large-scale production

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b The specializing country behaving as a monopoly

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cSmaller production runs resulting in lower unit costs

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dHigh wages paid to foreign workers

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If a country has a burden of debt it cannot sustain it can ?


areschedule debt

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bget a loan from an international organization

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cdefault on the loan

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d any of the above

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View Answer any of the above

Import substitution is the replacement of ____ by domestic production _____ protection of ________?


aexports, subsidies

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bexports, patents

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cimports, high tariffs or import quotas

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dimports, subsidies

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