Chap 21 and 19

Question 1

laws that block imports sold below the cost of production and impose tariffs that would increase the price of these imports to reflect their cost of production

Answer 1

anti-dumping laws

Question 2

economic agreement between countries to allow free trade in goods, services, labor, and financial capital between members while having a common external trade policy

Answer 2

common market

Question 3

innovative new product or production technology which disrupts the status quo in a market, leading the innovators to earn more income and profits and the other firms to lose income and profits, unless they can come up with their own innovations

Answer 3

disruptive market change

Question 4

selling internationally traded goods below their cost of production

Answer 4

dumping

Question 5

economic agreement between countries to allow free trade between members, a common external trade policy, and coordinated monetary and fiscal policy

Answer 5

economic union

Question 6

economic agreement between countries to allow free trade between members

Answer 6

free trade agreement

Question 7

forum in which nations could come together to negotiate reductions in tariffs and other barriers to trade; the precursor to the World Trade Organization

Answer 7

General Agreement on Tariffs and Trade (GATT)

Question 8

numerical limits on the quantity of products that can be imported

Answer 8

import quotas

Question 9

the argument that there are compelling national interests against depending on key imports from other nations

Answer 9

national interest argument

Question 10

ways a nation can draw up rules, regulations, inspections, and paperwork to make it more costly or difficult to import products

Answer 10

nontariffs barriers

Question 11

government policies to reduce or block imports

Answer 11

protectionism

Question 12

when production locates in countries with the lowest environmental (or other) standards, putting pressure on all countries to reduce their environmental standards

Answer 12

race to the bottom

Question 13

organization that seeks to negotiate reductions in barriers to trade and to adjudicate complaints about violations of international trade policy; successor to GATT

Answer 13

World Trade Organization (WTO)

Question 14

economy of a country that has demonstrated the ability to catch up to the technology leaders by investing in both physical and human capital

Answer 14

converging economy

Question 15

the economies of Taiwan, Singapore, Hong Kong, and South Korea, which maintained high growth rates and rapid export-led industrialization between the early 1960s and 1990 allowing them to converge with the technological leaders in high income countries

Answer 15

East Asian Tigers

Question 16

a series of studies that show, statistically, that 70% of the differences in income per person across the world is explained by differences in physical capital (savings/investment)

Answer 16

growth consensus

Question 17

nation with a per capita income of $12,475 or more; typically has high levels of human and physical capitals

Answer 17

high-income countries

Question 18

a nation that has a per capita income of less than $1,025; a third of the world’s populations

Answer 18

low-income country

Question 19

a nation with per capita income between $1,025 and $12,475 and that has shown some ability, even if not always sustained, to catch up to the technology leaders in high income countries

Answer 19

middle-income country