Macroeconomics and International Unit 3 Exam

What are the benefits of international trade for nations?

• Increased isolation
• Access to a larger variety of goods and services
• Decreased competition
• Reduced economic growth

What does it mean for a nation to have a comparative advantage in production?

• It can produce a good at a lower opportunity cost than other nations
• It can produce more goods than any other nation
• It has the most advanced technology
• It has the largest workforce

List the common types of trade barriers.

• Tariffs, quotas, standards, and subsidies
• Free trade agreements, open markets, and globalization
• Import licenses, export bans, and trade unions
• Currency exchange, inflation, and interest rates

How can trade barriers benefit domestic producers?

• By increasing foreign competition
• By reducing the cost of raw materials
• By protecting them from foreign competition
• By increasing the availability of foreign goods

What is the role of the ports of Savannah and Brunswick in Georgia's economy?

• They are primarily used for military purposes
• They facilitate international trade and boost the local economy
• They are used for recreational activities
• They are the main source of agricultural production

How do changes in exchange rates affect international trade?

• They have no impact on trade
• They can make exports cheaper or more expensive
• They only affect domestic trade
• They stabilize global markets

List the factors that can cause changes in exchange rates.

• Interest rates, inflation, and political stability
• Population growth, climate change, and cultural trends
• Technological advancements, education levels, and urbanization
• Language diversity, historical events, and geographical location

What are the effects of currency appreciation on a nation's economy?

• It makes exports more competitive
• It makes imports cheaper and exports more expensive
• It leads to higher inflation
• It reduces the purchasing power of consumers

How does currency depreciation affect net exports?

• It decreases net exports by making them more expensive
• It increases net exports by making them cheaper
• It has no effect on net exports
• It stabilizes net exports

What are the costs to consumers of imposing trade barriers?

• Lower prices for goods
• Reduced variety and higher prices for goods
• Increased access to foreign products
• Improved product quality