Exam%20_2 - Name: _ (Last name, first name) SID: _ GSI: _...

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Exam #2 (Fall 2009) 1/16 Name: _________________________ (Last name, first name) SID: _________________________ GSI: _________________________ UGBA 118 Econ C181/EnvEcon C181 International Trade Professor Steven Wood Fall 2009 Exam #2 Please sign the following oath: The answers on this test are entirely my own work. I neither gave nor received any aid while taking this test. I will not discuss the questions on this test with any other students until after 3:30 p.m. on December 19, 2009. _______________________________________ Signature Any test turned in without a signature will be assigned a grade of zero. Graph Instructions When drawing diagrams, the following rules apply: 1. Completely , clearly and accurately label all axis, lines, curves, and equilibrium points. 2. The original diagram and equilibrium points MUST be drawn in black or pencil. 3. The first shift of any line(s) and the new equilibrium points MUST be drawn in red. 4. The second shift of any line(s) and new equilibrium points MUST be drawn in blue. 5. The third shift of any line(s) and new equilibrium points MUST be drawn in green. Do NOT open this test until instructed to do so. Good Luck!
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Exam #2 (Fall 2009) 3/16 Multiple Choice Questions . Circle the letter corresponding to the best answer (3 points each; total of 30 points.) 1. If a large country imposes a tariff, it will decrease the world price the most when: a. Both the domestic demand curve and the foreign supply curve are very elastic. b. Both the domestic demand curve and the foreign supply curve are very inelastic. c. The domestic demand curve is very elastic and the foreign supply curve is very inelastic. d. The domestic demand curve is very inelastic and the foreign supply curve is very elastic. 2. If a large country enacts an export subsidy, it will increase the domestic price the most when: a. Both the domestic supply curve and the foreign demand curve are very elastic. b. Both the domestic supply curve and the foreign demand curve are very inelastic. c. The domestic supply curve is very elastic and the foreign demand curve is very inelastic. d. The domestic supply curve is very inelastic and the foreign demand curve is very elastic. 3. Tariff rates are generally much lower on raw materials, primary products, and component parts than they are on finished goods. As globalization tends to increase the proportion of imported inputs relative to domestically supplied component parts: a. The nominal tariff rate on finished goods automatically increases. b.
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Exam%20_2 - Name: _ (Last name, first name) SID: _ GSI: _...

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