Question 1

The benefits of international trade accrue in the forms of lower domestic prices, development of more efficient methods and new products, and a greater range of consumption choices.

Accepted Answer

A) True 
 B)False

Question 2

Which statement is true about international trade?

Accepted Answer

A)   It is zero-sum game.
B)   Imports always result in domestic unemployment.
C)   Tariffs on imports always protect domestic jobs.
D)   Imports and exports are connected; as one falls, the other generally rises.

Question 3

Economists who suggest that the United States is losing its competitive edge cite that

Accepted Answer

A)   manufacturing drives innovation and that more American firms are choosing to manufacture overseas.
B)   the quality of education in western countries is declining.
C)   the United States is ambivalent about technology.
D)   the Asian continent contains more raw materials than the United States. A

Question 4

As measured by the value of trade, Canada, Mexico, and China are the three top trading partners of the United States.

Accepted Answer

A) True 
 B)False

Question 5

The development of diesel engines and gas turbines helped reduce transportation costs and thus increase international trade among nations.

Accepted Answer

A) True 
 B)False  True

Question 6

In an open trading system, a country will import those commodities that it produces at relatively low cost while exporting commodities that can be produced at relatively high cost.

Accepted Answer

A) True 
 B)False

Question 7

The openness ratio is measured by a country's

Accepted Answer

A)   exports as a percent of GDP.
B)   imports as a percent of GDP.
C)   exports minus imports as a percent of GDP.
D)   exports plus imports as a percent of GDP.

Question 8

What led to the sharp loss of market share in the example of the Eastman Kodak Company?

Accepted Answer

A)   increased desire for higher quality product substitutes
B)   consumer concern over Eastman Kodak's near monopoly in the U.S. markets
C)   lack of innovation in emerging digital technologies
D)   increased profits of domestic import-competing industries C

Question 9

Economic interdependence occurs through

Accepted Answer

A)   trade.
B)   protectionism.
C)   war.
D)   tariffs.

Question 10

Open economies have less firm turnover due to more stable markets.

Accepted Answer

A) True 
 B)False

Question 11

In recent decades, the United States has become tied to other nations through a rise in

Accepted Answer

A)   capital flows.
B)   labor mobility.
C)   domestic ownership of financial assets.
D)   production as compared to consumption.

Question 12

The definition of an open economy is that it

Accepted Answer

A)   allows private ownership of capital.
B)   has flexible exchange rates.
C)   has fixed exchange rates.
D)   conducts trade with other countries.

Question 13

Why has the economy of the United States realized waves of globalization?

Accepted Answer

A)   The United States consistently increases tariffs.
B)   The United States economy has been consistently opening up since the 1920s.
C)   Technology, supported by American investors, drives productivity.
D)   The trade policy of the United States has been uneven, resulting in periods of more/less openness to international trade.

Question 14

Economists have generally found that economic growth rates have a close relation to all of the following EXCEPT

Accepted Answer

A)   openness to trade.
B)   education.
C)   communications infrastructure.
D)   import restrictions.

Question 15

According to human rights activists, which organization supports governments that permit sweatshops?

Accepted Answer

A)   The International Organization for Standardization
B)   The International Monetary Fund
C)   The World Health Organization
D)   The World Trade Organization

Question 16

In the long run, competitiveness depends on an industry's natural resources, its stock of machinery and equipment, and the skill of its workers in creating goods that people want to buy.

Accepted Answer

A) True 
 B)False

Question 17

The "Made in America" emblem printed on televisions sold by Element Electronics is intended to inform consumers of its commitment to create quality manufacturing jobs in the United States.

Accepted Answer

A) True 
 B)False

Question 18

The slogans "Buy American" and "American goods create American jobs" reflect

Accepted Answer

A)   concern over the number of exports leaving the country.
B)   concern about the threat of foreign competition.
C)   a desire for fewer import restrictions.
D)   a lack of job security within exporting firms.

Question 19

Increased foreign competition tends to increase profits of domestic import-competing companies.

Accepted Answer

A) True 
 B)False

Question 20

Which statement is true about import restrictions?

Accepted Answer

A)   They decrease the volume of exports.
B)   They lead to more jobs for domestic workers.
C)   They decrease imports and increase exports.
D)   They are more conducive to prosperity than free trade.

Exam 1: The International Economy and Globalization

The benefits of international trade accrue in the forms of lower domestic prices, development of more efficient methods and new products, and a greater range of consumption choices.

Correct AnswerverifiedShow Answer

Which statement is true about international trade?

Correct AnswerverifiedShow Answer

Economists who suggest that the United States is losing its competitive edge cite that

Correct AnswerverifiedA

As measured by the value of trade, Canada, Mexico, and China are the three top trading partners of the United States.

Correct AnswerverifiedShow Answer

The development of diesel engines and gas turbines helped reduce transportation costs and thus increase international trade among nations.

Correct AnswerverifiedTrue

In an open trading system, a country will import those commodities that it produces at relatively low cost while exporting commodities that can be produced at relatively high cost.

Correct AnswerverifiedShow Answer

The openness ratio is measured by a country's

Correct AnswerverifiedShow Answer

What led to the sharp loss of market share in the example of the Eastman Kodak Company?

Correct AnswerverifiedC

Economic interdependence occurs through

Correct AnswerverifiedShow Answer

Open economies have less firm turnover due to more stable markets.

Correct AnswerverifiedShow Answer

In recent decades, the United States has become tied to other nations through a rise in

Correct AnswerverifiedShow Answer

The definition of an open economy is that it

Correct AnswerverifiedShow Answer

Why has the economy of the United States realized waves of globalization?

Correct AnswerverifiedShow Answer

Economists have generally found that economic growth rates have a close relation to all of the following EXCEPT

Correct AnswerverifiedShow Answer

According to human rights activists, which organization supports governments that permit sweatshops?

Correct AnswerverifiedShow Answer

In the long run, competitiveness depends on an industry's natural resources, its stock of machinery and equipment, and the skill of its workers in creating goods that people want to buy.

Correct AnswerverifiedShow Answer

The "Made in America" emblem printed on televisions sold by Element Electronics is intended to inform consumers of its commitment to create quality manufacturing jobs in the United States.

Correct AnswerverifiedShow Answer

The slogans "Buy American" and "American goods create American jobs" reflect

Correct AnswerverifiedShow Answer

Increased foreign competition tends to increase profits of domestic import-competing companies.

Correct AnswerverifiedShow Answer

Which statement is true about import restrictions?

Correct AnswerverifiedShow Answer

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True

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C

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