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Exam 18: Fiscal Policy

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Question 71

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A tariff is a tax imposed by a government on

A) exports.
B) services.
C) imports.
D) luxury items.

E) A) and C)
F) None of the above

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Question 72

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Which of the following is not a source of comparative advantage?

A) Relative abundance of labour and capital
B) Technology
C) Climate and natural resources
D) A strong foreign currency exchange rate

E) A) and B)
F) B) and D)

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Question 73

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Table 18-3 Bryce and Tina are artisans who produce homemade candles and soap. Table 18-3 lists the number of candles and bars of soap Bryce and Tina can each produce in one month. -Refer to Table 18-3.Select the statement that accurately interprets the data in the table.

Once a country has lost its comparative advantage in producing a good,its income will be ________ and its economy will be ________ if it switches from producing the good to importing it.

Table 18-5 Table 18-5 shows the output per week for bows and arrows by Ahmet and MyLinh. -Refer to Table 18-5. a.Which person has an absolute advantage in the production of bows? Of arrows? b.Which person has a comparative advantage in the production of bows? c.Which person has a comparative advantage in the production of arrows?

Exports are domestically produced goods and services

Table 18-6 Production and Consumption Production Without Trade With Trade Denmark and Belize can produce both clocks and hats. Table 18-6 shows the production and consumption quantities without trade, and the production numbers with trade. -Refer to Table 18-6.If the actual terms of trade are 1 hat for 1.8 clocks and 150 hats are traded,how many clocks will Belize consume?

The World Trade Organization (WTO) promotes foreign trade and investment,or globalisation.In recent years opposition to globalisation has led to violent protests at meetings of the WTO.One reason for these anti-globalisation protests is

A situation in which a country does not trade with other countries is called

Table 18-6 Production and Consumption Production Without Trade With Trade Denmark and Belize can produce both clocks and hats. Table 18-6 shows the production and consumption quantities without trade, and the production numbers with trade. -Refer to Table 18-6.Prior to trade,what was the opportunity cost to produce 1 clock in Belize?

Anti-globalisation and protectionism are both arguments against free trade.How do these two arguments differ?