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Questions in this quiz (39)
1The intertemporal budget constraint is defined as:
- ADP + DF/(1 + r) = QP + QF/(1 + r)
- BDF + DP/(1 + r) = QF + QP/(1 + r)
- CDP + DF(1 + r) = QP + QF(1 + r)
- DV = DP + DF/(1 + r)
- EV = QP + QF/(1 + r)
2The price of ________ consumption in terms of ________ consumption is ________.
- Afuture; current; 1/(1 + r)
- Bpresent; future; 1/(1 + r)
- Cfuture; current; r
- Dpresent; future; r
- Efuture; current; 1 + r
3An increase in the real interest rate, all other things held constant, will cause a country's ________ to ________.
- Acurrent consumption: decrease
- Bcurrent consumption: increase
- Cterms of trade; improve
- Dterms of trade; worsen
- Ewelfare level; improve
4A fall in the real interest rate, all other things held constant, will cause a country's ________ to ________.
- Acurrent consumption: increase
- Bcurrent consumption: decrease
- Cterms of trade; improve
- Dterms of trade; worsen
- Ewelfare level; improve
5The intertemporal tradeoff between present and future consumption is measured by the
- Areal interest rate.
- Binflation rate.
- Cnominal interest rate.
- Dterms of trade.
- Erate of economic growth.
6It may be argued that theoretically, international capital movements
- Atend to hurt labor in donor countries.
- Btend to hurt the donor countries.
- Ctend to hurt the recipient countries.
- Dtend to hurt labor in recipient countries.
- Eincrease future production in donor countries.
7Rapidly growing developing countries tend to be borrowers on the international capital markets. From this information we may surmise that they have a comparative advantage in
- Afuture income.
- Bcapital goods.
- Cdisposable income.
- Dconsumer goods.
- Epresent income.
8If one observes that Japan was traditionally a net foreign lender, one could conclude that relative to its international trade and financial partners
- AJapan's intertemporal production possibilities are biased toward present consumption.
- BJapan's intertemporal production possibilities are biased toward future consumption.
- CJapan's intertemporal production possibilities are larger than that of the other countries.
- DJapan's intertemporal production possibilities are not biased.
- EJapan preferred to consume beyond its production in the present.
9International borrowing and lending may be interpreted as one form of
- Aintertemporal trade.
- Bintermediate trade.
- Ctrade in services.
- Dunrequited international transfers.
- Eaid to offset trade advantages.
10An export subsidy will cause the terms of trade of the ________ country to ________ and will ________ the country.
- Aexporting; suffer; harm
- Bexporting; improve; benefit
- Cimporting; suffer; harm
- Dimporting; suffer; benefit
- Eimporting; improve; harm
11An import tariff will cause the terms of trade of the ________ country to ________ and will ________ the country.
- Aimporting; improve; benefit
- Bexporting; improve; benefit
- Cimporting; suffer; harm
- Dexporting; improve; harm
- Eimporting; improve; harm
12An export subsidy will cause the relative demand for ________ to ________ and the relative supply for ________ to ________.
- Aexports; decrease; exports; increase
- Bimports; decrease; imports; increase
- Cimports; increase; imports; decrease
- Dexports; increase; exports; decrease
- Eexports; increase; imports; decrease
13An import tariff will cause the relative demand for ________ to ________ and the relative supply for ________ to ________.
- Aimports; decrease; imports; increase
- Bimports; increase; imports; decrease
- Cexports; increase; exports; decrease
- Dexports; decrease; exports; increase
- Eexports; increase; imports; decrease
14An increase in a country's net commodity terms of trade will
- Anot always guarantee positive changes in the country's economy
- Balways increase the country's economic welfare.
- Calways increase the country's real income
- Dnever increase the country's quantity of exports.
- Ealways increase the country's production of its import competing good.
15If a small country were to levy a tariff on its imports then this would
- Adecrease the country's economic welfare.
- Bhave no effect on that country's economic welfare.
- Cincrease the country's economic welfare.
- Dchange the terms of trade.
- Eraise prices on its exports in other countries.
16If Slovenia were a large country in world trade, then if it instituted a large set of subsidies for its exports, this must
- Aimprove the real income of its trade partners.
- Bcause retaliation on the part of its trade partners.
- Charm Slovenia's real income.
- Dimprove Slovenia's real income.
- Eincrease internal prices above the world market rate.
17If Slovenia were a large country in world trade, then if it instituted a large set of subsidies for its exports, this must
- Aharm its terms of trade.
- Bhave no effect on its terms of trade.
- Cimprove its terms of trade.
- Ddecrease its marginal propensity to consume.
- Eharm world terms of trade.
18If Slovenia were a large country in world trade, then if it imposes a large set of tariffs on its imports, this must
- Adecrease the internal price of imports below the world market rate.
- Bcause retaliation on the part of its trade partners.
- Charm Slovenia's real income.
- Dimprove Slovenia's real income.
- Eimprove the real income of its trade partners.
19If Slovenia is a large country in world trade, then if it imposes a large set of tariffs on many of its imports, this would
- Aimprove its terms of trade.
- Bhave no effect on its terms of trade.
- Charm its terms of trade.
- Ddecrease its marginal propensity to consume.
- Eincrease its exports.
20If Slovenia is a small country in world trade terms, then if it imposes a large series of tariffs on many of its imports, this would
- Ahave no effect on its terms of trade.
- Bimprove its terms of trade.
- Cdeteriorate its terms of trade.
- Ddecrease its marginal propensity to consume.
- Eincrease its exports.
21If the U.S. (a large country) imposes a tariff on its imported good, this will tend to
- Aimprove the terms of trade of the United States.
- Bhave no effect on terms of trade.
- Cimprove the terms of trade of all countries.
- Dcause a deterioration of U.S. terms of trade.
- Eraise the world price of the good imported by the United States.
22Refer to the figure above, which shows a country's possible production possibility frontiers and indifference curves. If the country is producing at ________, then moving to ________ will cause utility to ________.
- Apoint b; point a; increase
- Bpoint a; point b; increase
- Cpoint c; point b; increase
- Dpoint c; point b; decrease
- Epoint a; point c; remain unchanged
23Refer to the figure above, which shows a country's possible production possibility frontiers and indifference curves. If the country is producing at ________, then moving to ________ will cause utility to ________.
- Apoint c; point b; remain unchanged
- Bpoint a; point b; increase
- Cpoint c; point b; increase
- Dpoint c; point b; decrease
- Epoint a; point c; remain unchanged
24Suppose that a "small country" experiences growth strongly biased toward its export, cloth
- Athis will have no effect on terms of trade for the country's trading partner.
- Bthis will tend to worsen the country's terms of trade.
- Cthis will tend to improve the country's terms of trade.
- Dthis will tend to worsen terms of trade for the country's trading partner.
- Ethis will tend to improve terms of trade for the country's trading partner.
25Suppose that a country experiences growth strongly biased toward its export, cloth
- Athis will tend to worsen the country's terms of trade.
- Bthis will tend to improve the country's terms of trade.
- Cthis will tend to leave the country's terms of trade unchanged.
- Dthis will tend to worsen the terms of trade for the country's trading partner.
- Ethis will increase the price of cloth relative to the imported good.
26When the production possibility frontier shifts out relatively more in one direction, we have
- Abiased growth.
- Bunbiased growth.
- Cimmiserizing growth.
- Dbalanced growth.
- Eimbalanced growth.
27If a country began exporting product A and importing product B, then, as compared to the autarky (no-trade) situation, the marginal cost of product A will
- Aincrease.
- Bdecrease.
- Cshift outward.
- Dshift inward.
- Eremain the same.
28If two countries with diminishing returns and different marginal rates of substitution between two products were to engage in trade, then
- Athe marginal rates of substitution of both would become equal.
- Bthe shapes of their respective production possibility frontiers would change.
- Cthe larger of the two countries would dominate their trade.
- Dthe country with relatively elastic supplies would export more.
- Ethe opportunity costs for the smaller country would increase.
29Refer to the figure above, which shows a country's possible production possibility frontiers and indifference curves. If the country is producing at ________, then moving to ________ will cause utility to ________.
- Apoint b; point c; remain unchanged
- Bpoint a; point b; increase
- Cpoint c; point b; increase
- Dpoint c; point b; decrease
- Epoint a; point c; remain unchanged
30If the economy is producing at point a on its production possibility frontier, then
- Aall of the country's workers are employed.
- Ball of the country's workers are specialized in one product.
- Call of the country's capital is used for one product.
- Dall of its capital is used, but not efficiently.
- Eall of the country's exports are produced in equal amounts.
31If points A and B are two locations on a country's production possibility frontier, then
- Athe country could produce either of the two bundles.
- Bconsumers are indifferent between the two bundles.
- Cproducers are indifferent between the two bundles.
- Dat any point in time, the country could produce both.
- Eboth bundles must have the same relative cost.
32Terms of trade refers to
- Athe relative price at which trade occurs.
- Bwhat goods are imported.
- Cwhat goods are exported.
- Dthe volume of trade.
- Ethe tariffs applied to trade.
33A country will be able to consume a combination of goods that is not attainable solely from domestic production if
- Athe world terms of trade differ from its domestic relative costs.
- Bthe country specializes in one product.
- Cthe country avoids international trade.
- Dthe world terms of trade equal the domestic relative costs.
- Ethe country's domestic production value equals world relative value.
34If the ratio of price of cloth (PC) divided by the price of food (PF) increases in the international marketplace, then
- Aworld relative quantity of cloth supplied will increase.
- Bworld relative quantity of cloth supplied and demanded will increase.
- Cworld relative quantity of cloth supplied and demanded will decrease
- Dworld relative quantity of cloth demanded will decrease.
- Eworld relative quantity of food will increase.
35If the ratio of price of cloth (PC) divided by the price of food (PF) increases in the international marketplace, then
- Athe cloth exporter will increase the quantity of cloth produced.
- Bthe cloth exporter will increase the quantity of cloth exported.
- Cthe food exporter will increase the quantity of food exported.
- Dthe cloth exporter will decrease the quantity of cloth exported.
- Ethe country would import more cloth.
36If the ratio of price of cloth (PC) divided by the price of food (PF) increases in the international marketplace, then
- Athe terms of trade of cloth exporters will improve.
- Ball countries would be better off.
- Cthe terms of trade of food exporters will improve.
- Dthe terms of trade of all countries will improve.
- Ethe terms of trade of cloth exporters will worsen.
37Tastes of individuals are represented by
- Aindifference curves.
- Bproduction possibility frontiers.
- Cisovalue lines.
- Dproduction functions.
- Ethe terms of trade.
38A country cannot produce a mix of products with a higher value than where
- Athe isovalue line is tangent to the production possibility frontier.
- Bthe isovalue line intersects the production possibility frontier.
- Cthe isovalue line is above the production possibility frontier.
- Dthe isovalue line is below the production possibility frontier.
- Ethe isovalue line is tangent with the indifference curve.
39The meaning of "terms of trade" is
- Athe price of a country's exports divided by the price of its imports.
- Bthe amount of exports sold by a country.
- Cthe price conditions bargained for in international markets.
- Dthe quantities of imports received in free trade.
- Ethe tariffs in place between two trading countries.
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- xx xx Quiz on Untitled, created by Sophia Gaamouz on 26/05/2016.
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- Sophia Gaamouz
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