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STUDY GUIDE 2 EC 2200-6 TR 3.30pm [Covering chapters 31, 32, 33, and 34] Multiple Choice Identify the choice that best completes the statement or answers the question. ____ 1. International trade a. raises the standard of living in all trading countries. b. lowers the standard of living in all trading countries. c. leaves the standard of living unchanged. d. raises the standard of living for importing countries and lowers it for exporting countries. ____ 2. Oceania buys $40 of wine from Escudia and Escudia buys $100 of wool from Oceania. Supposing this is the only trade that these countries do. What are the net exports of Oceania and Escudia in that order? a. $140 and $140 b. $100 and $40 c. $60 and -$60 d. None of the above is correct. Table 31-1 Argentinean Trade Flows Goods Services Purchased Abroad $40 billion Purchased Abroad $20 billion Sold Abroad $10 billion Sold Abroad $25 billion ____ 3. Refer to Table 31-1. What are Argentinas net exports? a. $30 billion b. $5 billion c.-$5 billion d.-$25 billion ____ 4. A firm in China sells toys to a U.S. department store chain. Other things the same, these sales a. increase U.S. net exports and decrease Chinese net exports. b. decrease U.S. net exports and increase Chinese net exports. c. increase U.S. and Chinese net exports. d. decrease U.S. and Chinese net exports. ____ 5. A Swiss company sells chocolates to a retailer in the United States. These sales by themselves a. decrease U.S. net export and Swiss net exports. b. decrease U.S. net exports and increase Swiss net exports. c. increase U.S. and Swiss net exports. d. increase U.S. net exports and decrease Swiss net exports. ____ 6. A firm in India hires a U.S. firm to provide economic forecasts. By itself this transaction a. increases U.S. exports and so increases the U.S. trade balance. b. increases U.S. exports and so decreases the U.S. trade balance. c. increases U.S. imports and so increases the U.S. trade balance. d. increases U.S. imports and so decreases the U.S. trade balance. ____ 7. If U.S. consumers increase their demand for apples from New Zealand, then other things the same New Zealands 1 a. imports and net exports rise. b. imports rise and net exports fall. c. exports and net exports rise. d. exports rise and net exports fall. ____ 8. Which of the following is correct? a. U.S. exports as a percentage of GDP have more than doubled since 1950. The U.S. currently has a trade surplus. b. U.S. exports as a percentage of GDP have more than doubled since 1950. The U.S. currently has a trade deficit. c. U.S. exports as a percentage of GDP have increased, but have not nearly doubled since 1950. The U.S. currently has a trade surplus. d. U.S. exports as a percentage of GDP have increased, but have not nearly doubled since 1950. The U.S. currently has a trade deficit.... View Full Document

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