• Home
  • Textbooks
  • Macroeconomics
  • International Trade

Macroeconomics

Roger A. Arnold

Chapter 21

International Trade - all with Video Answers

Educators


Chapter Questions

06:52

Problem 1

Although a production possibilities frontier is usually drawn for a country, one could be drawn for the world. Picture the world's production possibilities frontier. Is the world positioned at a point on the PPF or below it? Give a reason for your answer.

Jennifer Stoner
Jennifer Stoner
Numerade Educator
01:12

Problem 2

If country A is better than country B at producing all goods, will country A still be made better off by specializing and trading? Explain your answer. (Hint: Look at Exhibit 1.)

Jennifer Stoner
Jennifer Stoner
Numerade Educator
04:12

Problem 3

The desire for profit can end up pushing countries toward producing goods in which they have a comparative advantage. Do you agree or disagree? Explain your answer.

Jennifer Stoner
Jennifer Stoner
Numerade Educator
04:12

Problem 4

The desire for profit can end up pushing countries toward producing goods in which they have a comparative advantage. Do you agree or disagree? Explain your answer.

Jennifer Stoner
Jennifer Stoner
Numerade Educator
06:51

Problem 5

Neither free trade nor prohibited trade comes with benefits only. Both come with benefits and costs. Therefore, free trade is no better or worse than prohibited trade. Comment.

Puneet Prajapati
Puneet Prajapati
Numerade Educator
View

Problem 6

Consider two groups of domestic producers: those which compete with imports and those which export goods. Suppose the domestic producers that compete with imports convince the legislature to impose a high tariff on imports-so high, in fact, that almost all imports are eliminated. Does this policy in any way adversely affect domestic producers that export goods? If so, how?

Oluwadamilola Ameobi
Oluwadamilola Ameobi
Numerade Educator
06:40

Problem 7

Suppose the U.S. government wants to curtail imports. Would it be likely to favor a tariff or a quota to accomplish its objective? Why?

Niamat Khuda
Niamat Khuda
Numerade Educator
06:48

Problem 8

Suppose the landmass known to you as the United States of America had been composed, since the nation's founding, of separate countries instead of separate states. Would you expect the standard of living of the people who inhabit this landmass to be higher, lower, or equal to what it is today? Why?

Noah Boudrie
Noah Boudrie
Numerade Educator
03:18

Problem 9

Even though Jeremy is a better gardener and novelist than Bill, Jeremy still hires Bill as his gardener. Why?

Mihir Nayar
Mihir Nayar
Numerade Educator
00:26

Problem 10

Suppose that a constitutional convention is called tomorrow and that you are chosen as one of the delegates from your state. You and the other delegates must decide whether it will be constitutional or unconstitutional for the federal government to impose tariffs and quotas or to restrict international trade in any way. What would be your position?

EA
Erwin Antoni
Numerade Educator
01:57

Problem 11

Some economists have argued that, because domestic consumers gain more from free trade than domestic producers gain from (import) tariffs and quotas, consumers should buy out domestic producers and rid themselves of costly tariffs and quotas. For example, if consumers save $$\$ 400$$ million from free trade (through paying lower prices) and producers gain $$\$ 100$$ million from tariffs and quotas, consumers can pay producers something more than $$\$ 100$$ million but less than $$\$ 400$$ million and get producers to favor free trade too. Assuming that this scheme were feasible, what do you think of it?

Rashmi Sinha
Rashmi Sinha
Numerade Educator
00:55

Problem 12

If there is a net loss to society from tariffs, why do tariffs exist?

Amrita Bhasin
Amrita Bhasin
Numerade Educator