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Econ QUIZ 10 - QUIZ 10 VERSION 1 1 If a country allows...

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QUIZ 10 VERSION 1 ____ 1. If a country allows trade and the domestic price of a good is higher than the world price, a. the country will become an exporter of the good. b. the country will become an importer of the good. c. the country will neither export nor import the good. d. additional information about demand is needed to determine whether the country will export or import the good. ____ 2. If Canada exports cars to France and imports cheese from Switzerland, a. Canada has a comparative advantage in producing cars, and Switzerland has a comparative advantage in producing cheese. b. Canada has a comparative advantage in producing cheese, and Switzerland has a comparative advantage in producing cars. c. Canada and France would both be better off if they each produced cars and cheese. d. Comparative advantage cannot be determined without knowing absolute prices. ____ 3. When a country allows trade and becomes an exporter of a good domestic producers ____ 4. When a country allows trade and becomes an exporter of a good, which of the following would NOT be true? ____ 5. Benefits from free trade include each of the following EXCEPT ____ 6. The world price of yo-yo's is $4.00 each. The pre-trade price of yo-yo's in Taiwan is $3.50 each. If Taiwan allows trade in yo-yo's we know that Taiwan will a. import yo-yo's and the price in Taiwan will be $4.00 each. b. import yo-yo's and the price in Taiwan will be $3.50 each. c. export yo-yo's and the price in Taiwan will be $4.00 each. d. export yo-yo's and the price in Taiwan will be $3.50 each. ____ 7. A budget constraint
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