Unit 5 Test Review

When one producer has a lower opportunity cost in production than other producers

• total advantage
• specialization
• comparative advantage
• absolute advantage

When one entity can either produce more overall output with given inputs, or use less overall inputs to produce a given output

• total advantage
• specialization
• comparative advantage
• absolute advantage

Increases efficiency and combined output, which allows nations to consume beyond their own production capabilities

• total advantage
• specialization
• comparative advantage
• absolute advantage

The unrestricted flow of goods, services, and productive resources between countries

• trade war
• free trade
• protectionism
• trade barrier

Laws passed or actions taken by the government of a country with the intention of restricting the flow of goods and services between itself and another country or countries

• trade war
• free trade
• protectionism
• trade barrier

A policy of establishing trade barriers

• trade war
• free trade
• protectionism
• trade barrier

A general concern about using any trade barrier is the possible retaliation of the other country, which could cause a......

• trade war
• free trade
• protectionism
• trade barrier

A complete ban on trade with a country (usually due to political disputes)

• tariff
• quotas
• embargo
• standard
• subsidies

Limits on the quantity of goods that can be imported into a country

• tariff
• quotas
• embargo
• standard
• subsidies

Government payments to domestic producers that help the domestic companies compete with producers in other nations

• tariff
• quotas
• embargo
• standard
• subsidies