6
6
6
Ricardian (Incorrect)
Heckscher-Ohlin (Incorrect)
monopolistic competition (True Answer Correct)
specific-factors (Incorrect)
4 Products traded between two nations that are very similar and
very close substitutes, but that may be of different quality or
prices, are called:
differentiated complements. (Incorrect)
differentiated substitutes. (Incorrect)
differentiated products. (True Answer Correct)
perfect substitute products. (Incorrect)
Ricardian (Incorrect)
Heckscher-Ohlin (Incorrect)
specific-factors (Incorrect)
All of the answer choices are correct. (True Answer Correct)
6 A differentiated product is one that:
identical. (Incorrect)
homogeneous. (Incorrect)
heterogeneous. (True Answer Correct)
None of the answer choices are correct. (Incorrect)
it will see lower sales but will not lose all its sales. (True Answer
Correct)
it will lose all its sales to competitor firms. (Incorrect)
it will actually get new customers from other firms. (Incorrect)
it will see an increase in revenues. (Incorrect)
13 The term for very similar products being exported and imported
by trading partners is:
price. (Incorrect)
marginal cost. (True Answer Correct)
average cost. (Incorrect)
average revenue. (Incorrect)
32 Whenever a firm's marginal costs are less than its average costs,
its average costs must be:
35 Firm X's total fixed costs are $1,000. Its total variable costs of
producing 100 units are $2,000, and its total variable costs of
producing 200 units are $4,000. Firm X's average costs
experiences which of the following as it increases output from
100 to 200 units?
Average costs increase. (Incorrect)
Average costs decrease. (True Answer Correct)
Average costs remain constant. (Incorrect)
Average costs increase slightly. (Incorrect)
$35. (Incorrect)
$50. (True Answer Correct)
$250. (Incorrect)
$100. (Incorrect)
Demand Equation: P = 10 – Q
Reference: Ref 6-3
Demand Equation: P = 10 – Q
Reference: Ref 6-3
Demand Equation: P = 10 – Q
Reference: Ref 6-3
decreases (Incorrect)
increases (True Answer Correct)
no change (Incorrect)
slight decreases (Incorrect)
96 A recap of the effects of NAFTA for its first 9 years reveals some
adjustment costs were offset by:
97 When imports and exports for the same type of good are nearly
equal:
101 For which product below would you expect the index of intra-
industry trade to be lowest?
105 If exports of an industry are $100 million and imports are zero,
the value of the index of intra-industry trade is:
108 Use this table on imports and exports of commodities for the United
States.
109 Use this table on imports and exports of commodities for the United
States.
110 Use this table on imports and exports of commodities for the United
States.
111 The higher the value for the index of intra-industry trade:
116 Other things equal, the gravity equation predicts that the
United States will have more trade with __________ than with
_________ .
Bangladesh; Japan (Incorrect)
Russia; Japan (Incorrect)
Canada; Bangladesh (True Answer Correct)
Russia; Bangladesh (Incorrect)
117 Other things equal, the level of bilateral trade between two
countries will increase as their GDP:
121 Larger countries will trade more with one another; this is
empirically supported by the:
trade. (Incorrect)
tariffs. (True Answer Correct)
monopolistic competition. (Incorrect)
imperfect competition. (Incorrect)
127 What did using the gravity equation to predict trade within the
borders of a nation reveal?
Trade between states or regions within a nation is much more
likely than trade outside the borders. (True Answer Correct)
Trade between states or regions within a nation is much less
likely to occur. (Incorrect)
There was no predictive value for trade within a nation's
borders. (Incorrect)
Trade between states or regions within a nation is more subject to
national law and regulation and therefore not as
predictable. (Incorrect)
131 Perfectly competitive firms can influence the price that they
charge.
True ()
False (True Answer )
135 Free entry means that any firm can begin production without
cost.
True ()
False (True Answer )
142 The Ricardian model and the Heckscher-Ohlin model show that
countries will export commodities that they also import in
order to maximize gains.
True ()
False (True Answer )
147 Suppose that imports and exports in an industry are both $100
million. If exports rise to $200 million, the value of the
industry's index of intra-industry trade will fall.
True (True Answer )
False ()
149 Suppose that the index of intra-industry trade for the U.S.
computer industry increases from 0.25 to 0.50. This increase
means that the U.S. computer industry produces more
computers.
True ()
False (True Answer )
157 When research and development costs are spread out over
more consumers, it is an example of what?
()
()
()
160 Why would you expect firms with high research and
development costs to be more interested in free trade?
()
161 The fall in real wages for the maquiladora workers during the
1990s was likely due to what?
()
162 Would you say that the gains clearly outweigh the costs of
NAFTA for the United States?
()
163 Has the United States gained or lost from NAFTA?
()
()