International Economics

All of the following are gains from trade, EXCEPT:

• lower prices for consumers

• a more efficient allocation of resources

• greater choices for consumers

• protection of domestic jobs

Economies of scale can be defined as:

• An increase in average production costs as the quantity of production is increased.

• A fall in average production costs as the quantity of production is increased.

• An increase in total production costs as the quantity of production is increased.

• A fall in total production costs as the quantity of production is increased.

Which of the following is not an objective of the World Trade Organization (WTO)

• to promote free trade among member countries by reducing trade barriers

• to handle trade disputes among member nations

• to offer loans to developing economics

• to be a forum for trade negotiations

Which of the following protectionist measures will not raise the price for consumers?

• Tariff

• Subsidies

• Quotas

• Administrative Barriers

Which of the following protectionist measures puts in the greatest burden on domestic taxpayers?

• Tariff

• Subsidies

• Quotas

After the implementation of the tariff, total imports on the diagram are:

• Q1 to Q4

• Q2 to Q3

• Q4

• Q2 to Q4

After the implementation of the trade subsidy, total imports on the diagram are:

• Q1 to Q2

• Q1 to Q3

• Q3 to Q2

• Q1

After the implementation of the quota, total domestic production on the diagram is:

• Q1

• Q2

• Q2 to Q3

• Q3 to Q4

In trade, dumping can be defined as:

• The selling of a good in another country at a price below its unit cost of production.

• Artificially keeping a country's currency below market value.

• The use of protectionist measures to protect domestic employment.

• The use of administrative barriers to limit imports.

All the following are benefits of protectionism, EXCEPT:

• protection of domestic jobs

• national security

• protection of infant industries

• cheaper prices for consumers