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Multiple-choiceQuestionsCh.81.Whichofthefollowingstatementsisincorrect?Anadvaloremtariffisexpressedasapercentageofthevalueofthetradedcommodityb.aspecifictariffisexpressedasafixedsumofthevalueofthetradedcommodity.c.exporttariffsareprohibitedbytheU.S.Constitutiond.TheU.S.usesexclusivelythespecifictariff 2.Asmallnationisone:a.whichdoesnotaffectworldpricebyitstradingb.whichfacesaninfinitelyelasticworldsupplycurveforitsimportcommoditywhoseconsumerswillpayapricethatexceedstheworldpricebytheamountofthetariffd.alloftheabove3.Ifasmallnationincreasesthetariffonitsimportcommodity,its:a.consumptionofthecommodityincreasesb.productionofthecommoditydecreasesc.importsofthecommodityincreased.noneoftheaboveTheincreaseinproducersurpluswhenasmallnationimposesatariffismeasuredbythearea:a.totheleftofthesupplycurvebetweenthecommoditypricewithandwithoutthetariffb.underthesupplycurvebetweenthequantityproducedwithandwithoutthetariffc.underthedemandcurvebetweenthecommoditypricewithandwithoutthetariffd.noneoftheabove.5.Ifasmallnationincreasesthetariffonitsimportcommodity:a.therentofdomesticproducersofthecommodityincreasesb.theprotectioncostofthetariffdecreasesc.thedeadweightlossdecreasesd.alloftheabove6.Whichofthefollowingstatementsisincorrectwithrespecttotherateofeffectiveprotection?a.forgivenvaluesofaiandti,gislargerthegreateristb.foragivenvalueoftandti,gislargerthegreaterisaic.gexceeds,isequaltoorissmallerthant,astiissmallerthan,isequaltoorislargerthantd.whenaitiexceedst,therateofeffectiveprotectionispositive7.Withai=50%,ti=0,andt=20%,gis:a.40%b.20%c.80%d.08.Theimpositionofanimporttariffbyasmallnation:a.increasestherelativepriceoftheimportcommodityfordomesticproducersandconsumersreducestherelativepriceoftheimportcommodityfordomesticproducersandconsumersc.increasestherelativepriceoftheimportcommodityforthenationasawholed.anyoftheaboveispossible9.Theimpositionofanimporttariffbyasmallnation:a.increasesthenation'swelfareb.reducesthenation'swelfarec.leavesthenation'swelfareunchangedd.anyoftheaboveispossible10.AccordingtotheStolper-Samuelsontheorem,theimpositionofatariffbyanation:a.increasestherealreturnofthenation'sabundantfactorb.increasestherealreturnofthenation'sscarcefactorc.reducestherealreturnofthenation'sscarcefactord.anyoftheaboveispossible11.Theimpositionofanimporttariffbyanationresultsin:a.an increaseinrelativepriceofthenation'simportcommodityb.anincreaseinthenation'sproductionofitsimportablecommodityc.reducestherealreturnofthenation'sabundantfactord.alloftheabove12.Theimpositionofanimporttariffbyanationcanberepresentedbyarotationofthe:a.nation'soffercurveawayfromtheaxismeasuringthecommodityofitscomparativeadvantagethenation'soffercurvetowardtheaxismeasuringthecommodityofitscomparativeadvantagetheothernation'soffercurvetowardtheaxismeasuringthecommodityofitscomparativeadvantagetheothernation'soffercurveawayfromtheaxismeasuringthecommodityofitscomparativeadvantage13.Theimpositionofanimporttariffbyalargenation:a.increasesthenation'stermsoftradeb.reducesthevolumeoftradec.mayincreaseorreducethenation'swelfared.alloftheabove14.Theimpositionofanoptimumtariffbyalargenation:a.improvesitstermsoftradeb.reducesthevolumeoftradec.increasesthenation'swelfared.alloftheabove15.Theoptimumtariffforasmallnationis:a.100%b.50%c.0 d.dependsonelasticitiesMultiple-choiceQuestionsCh.9:1.Animportquota:a.increasesthedomesticpriceoftheimportedcommodityb.reducesdomesticconsumptionc.increasesdomesticproductiond.alloftheabove2.Anincreaseinthedemandoftheimportedcommoditysubjecttoagivenimportquota:a.reducesthedomesticquantitydemandedofthecommodityb.increasesthedomesticproductionofthecommodityc.reducesthedomesticpriceofthecommodityd.reducestheproducers'surplus 3.Adjustmenttoanyshiftinthedomesticdemandorsupplyofanimportablecommodityoccurs:a.indomesticpricewithanimportquotab.inthequantityofimportswithatariffc.throughthemarketmechanismwithanimporttariffbutnotwithanimportquotad.alloftheabove4.Aninternationalcartelrefersto:a.dumpingb.anorganizationofexportersc.aninternationalcommodityagreementd.voluntaryexportrestraints5.Thetemporarysaleofacommodityatbelowcostoratalowerpriceabroadinordertodriveforeignproducersoutofbusinessiscalled:a.predatorydumpingb.sporadicdumpingc.continuousdumpingd.voluntaryexportrestraints6.Thetypeofdumpingwhichwouldjustifyantidumpingmeasuresbythecountrysubjecttothedumpingis:a.predatorydumpingb.sporadicdumpingc.continuousdumpingd.alloftheabove7.Afallaciousargumentforprotectionis:a.theinfantindustryargumentb.protectionfornationaldefensec.thescientifictariffd.tocorrectdomesticdistortions8.Whichofthefollowingistruewithrespecttotheinfant-industryargumentforprotection:a.itreferstotemporaryprotectiontoestablishadomesticindustrytobevalid,thereturntothegrown-upindustrymustbesufficientlyhighalsotorepayforthehigherpricespaidbydomesticconsumersofthecommodityduringtheinfancyperiodc.isinferiortoanequivalentproductionsubsidytotheinfantindustryd.alloftheabove9.Whichofthefollowingisfalsewithrespecttostrategictradepolicy?a.itpostulatesthatanationcangainbyanactivisttradepolicyb.itispracticedtosomeextentbymostindustrialnationsc.itcaneasilybecarriedoutd.alloftheabove10.Industrialpolicyrefersto:anactivistpolicybythegovernmentofanindustrialcountrytostimulatethedevelopmentofanindustrythegrantingofasubsidytoadomesticindustrytostimulatethedevelopmentofanindustryc.thegrantingofasubsidytoadomesticindustrytocounteraforeignsubsidyd.alloftheabove11.Gametheoryrefersto:a.amethodofchoosingtheoptimalstrategyinconflictsituationsb.thegrantingofasubsidytocorrectadomesticdistortionc.thetheoryoftariffprotectiond.noneoftheabove12.TradeprotectionintheUnitedStatesisusuallyprovidedto:a.low-wageworkersb.well-organizedindustrieswithlargeemploymentc.industriesproducingconsumerproductsd.alloftheabove13.Themost-favored-nationprinciplerefersto:a.extensiontoalltradepartnersofanyreciprocaltariffreductionnegotiatedbytheU.S.withanyofitstradepartners b.multilateraltradenegotiation c.theGeneralAgreementonTariffsandTrade d.theInternationalTradeOrganization14.OnwhichofthefollowingprinciplesdoesGATTrest?a.nondiscriminationb.eliminationofnontariffbarriersc.consultationamongnationsinsolvingtradedisputesd.alloftheabove15.Whichofthefollowingwasnotnegot

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