homework2 - Name: _ Macroeconomics Fall 2010 Homework #2...

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Name: ________________________ Macroeconomics Fall 2010 Homework #2 Multiple Choice Identify the letter of the choice that best completes the statement or answers the question. ____ 1. Which of the following is a cause of frictional unemployment? a. the minimum wage b. a worker leaving a job to find one with better benefits c. labor unions d. All of the above are correct. ____ 2. If the domestic price in a country is below the world price for a good, then if free-trade is permitted a. the country will import because it has a comparative advantage in the good b. the country will export because it has a comparative advantage in the good c. The country will import because it does not have a comparative advantage in the good d. The country will export because it does not have a comparative advantage in the good Figure 9-10 ____ 3. Refer to Figure 9-10 . Consumer surplus in this market before world trade is a. A. b. B + C. c. A + B + D. d. C. ____ 4. Refer to Figure 9-10 . Producer surplus in this market after world trade is a. C. b. C + B. c. A + B + D. d. B + C + D.
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Figure 9-14 ____ 5. Refer to Figure 9-14 . With world trade and without a tariff, the price and domestic quantity demanded are a. P 1 and Q 1 . b. P 1 and Q 4 . c. P 2 and Q 2 . d. P 2 and Q 3 . ____ 6. Refer to Figure 9-14 . Consumer surplus with world trade and without a tariff is a. A. b. A + B. c. A + C + G. d. A + B + C + D + E + F. ____ 7. Refer to Figure 9-14 . As a result of the tariff, there is a deadweight loss that amounts to a. B. b. E. c. D + F. d. B + D + E + F. ____ 8. The infant-industry argument a. is based on the belief that protecting industries when they are young will pay off later. b. is based on the belief that protecting industries producing goods and services for infants is necessary if a country is to have healthy children. c.
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homework2 - Name: _ Macroeconomics Fall 2010 Homework #2...

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