CHAPTER_1_THE_INTERNATIONAL_ECONOMY_AND_GLOBALIZATION

CHAPTER_1_THE_INTERNATIONAL_ECONOMY_AND_GLOBALIZATION

1.A

primary reason why nations conduct international trade is because:

• Some nations prefer

to produce one thing while others produce other things

• Resources are not equally

distributed among all trading nations

• Trade enhances opportunities

to accumulate profits

• Interest rates are not identical

in all trading nations

ANSWER: b

POINTS: 1

DIFFICULTY: Easy

NATIONAL STANDARDS: United States

- BUSPROG: Analytic

STATE STANDARDS: United States - PA - DISC: Gains from trade, speciali - DISC: Gains from trade, specialization and trade

TOPICS: Globalization

of Economic Activity KEYWORDS: BLOOM'S: Knowledge

2.A main advantage of specialization results from:

• Economies

of large-scale production

• The specializing

country behaving as a monopoly

• Smaller

production runs resulting in lower unit costs

• High wages paid to foreign workers

ANSWER: a

POINTS: 1

DIFFICULTY: Moderate

NATIONAL STANDARDS: United

States - BUSPROG: Diversity

STATE STANDARDS: United States - PA - DISC: Gains from trade, speciali - DISC: Gains from trade, specialization and trade

TOPICS: Why is Globalization Important?

KEYWORDS: BLOOM'S: Comprehension 3.International trade in goods

and services is sometimes used as a substitute for all of the following except:

• International movements

of capital

• International movements of labor
• Domestic production of the same

goods and services

• Domestic

production of different goods and services

ANSWER: d

POINTS: 1

DIFFICULTY: Challenging

NATIONAL STANDARDS: United States - BUSPROG: Diversity STATE STANDARDS: United States - PA - DISC: Gains from trade, speciali - DISC: Gains from trade, specialization and trade

TOPICS: Globalization

of Economic Activity KEYWORDS: BLOOM'S: Comprehension 4.If

a nation has an open economy, it means that the nation:

• Allows private

ownership of capital

• Has flexible

exchange rates

• Has fixed exchange rates

International Economics 15e Robert Carbaugh (Test Bank All Chapters, 100% Original Verified, A+ Grade) 1 / 4

• Conducts trade with other countries

ANSWER: d

POINTS: 1

DIFFICULTY: Easy

NATIONAL STANDARDS: United States - BUSPROG: Diversity STATE STANDARDS: United States - PA - DISC: Gains from trade, speciali - DISC: Gains from trade, specialization and trade

TOPICS: The United States as an Open Economy

KEYWORDS: BLOOM'S: Comprehension 5.International trade forces domestic firms to become more competitive in terms of:

• The introduction of new products
• Product design and quality
• Product price
• All of the above

ANSWER: d

POINTS: 1

DIFFICULTY: Moderate

NATIONAL STANDARDS: United States - BUSPROG: Diversity STATE STANDARDS: United States - PA - DISC: Gains from trade, speciali - DISC: Gains from trade, specialization and trade

TOPICS: The United States as an Open Economy

KEYWORDS: BLOOM'S: Comprehension 6.The movement to free international trade is most likely to generate short-term unemployment in which industries?

• Industries in which there are neither imports nor exports
• Import-competing industries
• Industries that sell to domestic and foreign buyers
• Industries that sell to only foreign buyers

ANSWER: b

POINTS: 1

DIFFICULTY: Moderate

NATIONAL STANDARDS: United States - BUSPROG: Diversity STATE STANDARDS: United States - PA - DISC: Gains from trade, speciali - DISC: Gains from trade, specialization and trade

TOPICS: Globalization and Competition

KEYWORDS: BLOOM'S: Comprehension

7.International trade is based on the idea that:

• Exports should exceed imports
• Imports should exceed exports
• Resources are more mobile internationally than are goods
• Resources are less mobile internationally than are goods

ANSWER: d

POINTS: 1

DIFFICULTY: Easy 2 / 4

NATIONAL STANDARDS: United States - BUSPROG: Diversity STATE STANDARDS: United States - PA - DISC: Gains from trade, speciali - DISC: Gains from trade, specialization and trade

TOPICS: Globalization of Economic Activity

KEYWORDS: BLOOM'S: Comprehension

8. Most of the world's population now lives in countries that are:

• integrated into world markets
• becoming integrated into world markets
• near poverty
• a and b

ANSWER: d

POINTS: 1

DIFFICULTY: Moderate

NATIONAL STANDARDS: United States - BUSPROG: Diversity STATE STANDARDS: United States - PA - DISC: Gains from trade, speciali - DISC: Gains from trade, specialization and trade

TOPICS: Is International Trade an Opportunity or Threat to Workers?

KEYWORDS: BLOOM'S: Comprehension

9. International trade benefits:

• all workers
• most workers
• many workers
• None of these is correct

ANSWER: c

POINTS: 1

DIFFICULTY: Moderate

NATIONAL STANDARDS: United States - BUSPROG: Diversity STATE STANDARDS: United States - PA - DISC: Gains from trade, speciali - DISC: Gains from trade, specialization and trade

TOPICS: Is International Trade an Opportunity or Threat to Workers?

KEYWORDS: BLOOM'S: Comprehension

• The largest amount of trade with the United States in recent years has been conducted by:
• Canada
• Germany
• Chile
• United Kingdom

ANSWER: a

POINTS: 1

DIFFICULTY: Easy

NATIONAL STANDARDS: United States - BUSPROG: Diversity STATE STANDARDS: United States - PA - DISC: Gains from trade, speciali - DISC: Gains from trade, specialization and trade TOPICS: The United States as an Open Economy 3 / 4

KEYWORDS: BLOOM'S: Knowledge

11. Increased foreign competition tends to:

• Intensify inflationary pressures at home
• Induce falling output per worker-hour for domestic workers
• Place constraints on the wages of domestic workers
• Increase profits of domestic import-competing industries

ANSWER: c

POINTS: 1

DIFFICULTY: Moderate

NATIONAL STANDARDS: United States - BUSPROG: Diversity STATE STANDARDS: United States - PA - DISC: Gains from trade, speciali - DISC: Gains from trade, specialization and trade

TOPICS: Globalization and Competition

KEYWORDS: BLOOM'S: Comprehension

• ____ is the ability of a firm/industry, under free and fair market conditions, to design, produce, and market goods and

services that are better and/or cheaper than those of other firms/industries.

• Competitiveness
• Protectionism
• Comparative advantage
• Absolute advantage

ANSWER: a

POINTS: 1

DIFFICULTY: Moderate

NATIONAL STANDARDS: United States - BUSPROG: Diversity STATE STANDARDS: United States - PA - DISC: Gains from trade, speciali - DISC: Gains from trade, specialization and trade

TOPICS: Globalization and Competition

KEYWORDS: BLOOM'S: Comprehension

• A firm's ____, relative to that of other firms, is generally regarded as the most important determinant of

competitiveness.

• Income level
• Tastes and preferences
• Governmental regulation
• Productivity

ANSWER: d

POINTS: 1

DIFFICULTY: Moderate

NATIONAL STANDARDS: United States - BUSPROG: Diversity STATE STANDARDS: United States - PA - DISC: Gains from trade, speciali - DISC: Gains from trade, specialization and trade

TOPICS: Globalization and Competition

KEYWORDS: BLOOM'S: Comprehension

• Free traders maintain that an open economy is advantageous in that it provides all of the following except:
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