Sample final exam questions

Sample final exam questions - Sample Final Exam Questions...

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1) The meaning of "terms of trade" is A) the price of a country's exports divided by the price of its imports. B) the amount of exports sold by a country. C) the price conditions bargained for in international markets. D) the quantities of imports received in free trade. E) the tariffs in place between two trading countries. 2) Tastes of individuals are represented by A) indifference curves. B) production possibility frontiers. C) isovalue lines. D) production functions. E) the terms of trade. 3) If the ratio of price of cloth (P C ) divided by the price of food (P F ) increases in the international marketplace, then A) the terms of trade of cloth exporters will improve. B) all countries would be better off. C) the terms of trade of food exporters will improve. D) the terms of trade of all countries will improve. E) the terms of trade of cloth exporters will worsen. 4) Suppose that a country experiences growth strongly biased toward its export, cloth, A) this will tend to worsen the country's terms of trade. B) this will tend to improve the country's terms of trade. C) this will tend to leave the country's terms of trade unchanged. D) this will tend to worsen the terms of trade for the country's trading partner. E) this will increase the price of cloth relative to the imported good. 5) If the U.S. (a large country) imposes a tariff on its imported good, this will tend to A) improve the terms of trade of the United States. B) have no effect on terms of trade. C) improve the terms of trade of all countries. D) cause a deterioration of U.S. terms of trade. E) raise the world price of the good imported by the United States. 6) External economies of scale arise when the cost per unit A) falls as the industry grows larger and rises as the average firm grows larger. B) rises as the industry grows larger and falls as the average firm grows larger. C) falls as the industry and the average firm grows larger. D) remains constant over a broad range of output.
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Sample final exam questions - Sample Final Exam Questions...

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