Economic Theories and Trade Policies

1. A protective ______ is used in an attempt to protect a country's businesses.

• subsidy
• embargo
• tariff
• quota

1. A(n) ______ might be used to prevent unhealthy products from entering a country.

• import tax
• import fee
• import quota
• Embargo

1. Choose the best answer using the table. Who has the absolute advantage in selling salads?

• Seller C
• Seller B
• Seller D
• MIKE

1. The _____ theory blames a rise in inflation on a rise in wage rates and the price of natural resources.

• structural
• cost-push
• monetary
• demand-pull

1. A(n) ____ good is something provided by the government that may be used by many citizens at the same time without reducing the benefit.

• public good
• club good
• common resource
• private good

1. Choose the best answer using the graph. About how many smartphones can China manufacture if they build 550 cargo ships?

• about 15 mil

• 600000

1. Government mismanagement of the economy is the cause of _____ inflation.

• demand-pull inflation
• built-in inflation
• structural

• cost-push inflation

1. ____ believed the best way to reverse an economic downturn was to increase government spending.

• John Maynard Keynes
• Paul Krugman
• Milton Friedman
• Friedrich Hayek

going online to a discount website to purchase old CDs 

• Buy vintage records from an auction site.
• Quality change effect

• Sell old CDs on a marketplace.
• Outlet substitution effect

replacing a DVD player with a device that can stream videos 

• Outlet substitution effect

• A device that only plays physical DVDs.
• New goods effect

• A Blu-ray player with no internet connection.