Economics Unit 4 Review

Front

Why do nations trade?

Back

Nations trade to specialize, acquire certain raw materials, and because they believe that the products they receive are worth more than the products they give up.

Front

Which of the following statements BEST describes trade between two nations? It is mutually beneficial., It is legally required., It avoids specialization., It involves low cost for both nations.

Back

It is mutually beneficial.

Front

Country A can produce more coal than Country B. An economist would say that Country A has ______________________________ over Country B.

Back

an absolute advantage

Front

The value of the wheat crop he chose not to grow could best be described as

Back

an opportunity cost

Front

In international trade, comparative advantage is measured in ___________________.

Back

efficiency

Front

______________________ are taxes on ___________________

Back

Tariffs, imports

Front

What does a protective tariff seek to protect?

Back

domestic industries

Front

In general, what effect does a quota have on the prices of comparable goods in the domestic market?

Back

It keeps prices from dropping.

Front

Which of the following is most directly affected by an embargo established by the United States? US tariffs, US exports, US imports, US free traders

Back

US exports

Front

What would a free-trader most likely support? Options: the infant industries argument, a revenue tariff, NAFTA, an embargo

Back

NAFTA