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Homework (Ch 06)

1. Protectionism, GATT, and world trade In 1932, U.S. manufacturers, which used to enjoy steady relationships with their foreign distributors and export nearly 60% of their output, realized that their exports had fallen to only 20% of total output. Which of the following is the most likely reason for this decrease in exports? The low […]

Homework (Ch 05)

1. Nontariff trade barriers Identify which type of nontariff trade barrier is used in each scenario in the following table. Scenario Export Quota Selective Quota Tariff-Rate Quota Global Quota Export Subsidy Domestic Production Subsidy Domestic Content Requirement The United States charges a tariff of 9.35¢ per kilogram for the first 30,393 tons of peanuts and […]

Study Questions (Ch 05)

1. Study Questions #1. Ch 5. Which of the following are the major nontariff trade barriers? Check all that apply. Legal actions Domestic content requirements Specific quota-rate tariffs Orderly marketing agreements Points: 1 / 1 Close Explanation Explanation: With the decline in import tariffs in the past two decades, nontariff trade barriers have gained in importance […]

Study Questions (Ch 04)

1. Study Questions #1. Ch 4. Which of the following defines a compound tariff? A fixed amount of money per unit of the imported product A fixed amount of money per unit combined with a fixed percentage of the value of the imported product A fixed percentage of the value of the imported product as it […]

Homework (Ch 04)

1. Identifying types of tariffs For each hypothetical scenario, complete the first column in the following table by indicating whether the tariff described is more likely a protective tariff or a revenue tariff. Scenario Protective or Revenue Tariff Type A. In response to concerns from business leaders, a legislator has designed a new tariff on raw […]

Study Questions (Ch 03)

1. Study Questions #1. Ch 3. Which of the following are effects of transportation costs on international trade patterns? Check all that apply. High transportation costs reduce a nation’s volume of trade. High transportation costs increase a nation’s volume of trade. Transportation costs facilitate the process of factor–price equalization. A nation may export and import the […]

Homework (Ch 03)

1. Visualizing the factor-endowment theory Consider the two hypothetical nations of Grork and Ferville. Suppose they both produce only two goods, robot vacuum cleaners and plastic army men. Each country faces a trade-off when producing the two goods. The following graph displays the respective production possibilities frontiers (PPF) for Grork and Ferville.   Terms of […]