Chapter 16 – International Trade

Question 0

Labor-intensive goods

Answer 0

Products that require a relatively large amount of labor to produce

Question 1

Free-trade

Answer 1

The absence of artificial government imposed barriers to trade among individuals and firms in different nations

Question 2

Land intensive goods

Answer 2

Products that require a relatively large amount of land produce

Question 3

Capital intensive goods

Answer 3

Products that require a relatively large amount of capital to produce

Question 4

Absolute advantage

Answer 4

When the region or nation can produce more of a product with your resources compared to other regions or nations

Question 5

Comparative advantage

Answer 5

When a producer can create a particular product at a lower opportunity cost than other producers

Question 6

Opportunity cost ratio

Answer 6

I need quality showing the number of units of two products that can be produced with the same resources

Question 7

Principle of comparative advantage

Answer 7

When a region or nation can produce a good at a lower domestic opportunity cost compared to a potential trading partner

Question 8

Terms of trade

Answer 8

The rate at which units of one product can be exchanged for units of another product

Question 9

Trading possibilities line

Answer 9

Shows the different combinations of two products and economies able to obtain when it specializes in the production of one product and exported to obtain the other product

Question 10

Gains from trade

Answer 10

The extra output that trading partners obtained through specialization of production and exchange of goods and services

Question 11

Efficient allocation of resources

Answer 11

That allocation of an economy’s resources among the production of different products that leads to the maximum satisfaction of consumers wants; producing the socially optimal mix of output with societies scarce resources

Question 12

World price

Answer 12

The international market price of a good or service, determined by world demand and supply

Question 13

Domestic price

Answer 13

The price of a good or service within a country, determined by domestic demand and supply

Question 14

Export supply curve

Answer 14

And up sloping curve that shows the amount of a product domestic firms will export at each world price that is above the domestic price

Question 15

Import demand curve

Answer 15

A downsloping curve that shows the amount of a product in economy will import at each world price below the domestic price

Question 16

Equilibrium world price

Answer 16

A price determined by the intersection of exporting nation supply the product and importing nations’ demand for the same product

Question 17

Tariff

Answer 17

A tax imposed by nation on an imported good

Question 18

Revenue Tariff

Answer 18

The tariff designed to produce income for the federal government

Question 19

Protective tariff

Answer 19

A tariff designed to shield domestic producers of a good or service from the competition of foreign producers

Question 20

Import quota

Answer 20

A limit imposed by nation on the quantity or total value of a good that may be important during some period of time

Question 21

Non-tariff barriers or NTB

Answer 21

All the restrictions other than tariffs the nations direct to impede international trade

Question 22

Voluntary export restriction or VER

Answer 22

Voluntary limitation by countries are friends of their exports to a particular foreign nation

Question 23

Export subsidy

Answer 23

A government payment to a domestic producer of export goods, designed to aid that producer.

Question 24

Dumping

Answer 24

The sale in a foreign country of products below cost or below the prices charged at home

Question 25

Fair trade movements

Answer 25

The efforts by groups in high income nations to get rowers of agricultural crops in low income nations to adhere to certain weed and workplace standards in exchange for their goods being promoted as fair trade goods to consumers; also efforts by these groups to convince consumers to buy these goods instead of otherwise close substitutes

Question 26

General agreement on tariffs and trade or GATT

Answer 26

The international agreement reached in 1947 in which 23 nations agreed to give equal and non-discriminatory treatment to one another, to reduce tariff rates by multinational negotiations, and to eliminate export quotas

Question 27

Uruguay round

Answer 27

A 1995 trade agreement that was fully implemented by 2005 that established the world trade organization, liberalize trade in goods and services, provided added protection to intellectual-property for example, patents and copyrights, and reduced farm subsidies

Question 28

World trade organization

Answer 28

An organization of 155 nations as of 2012 that oversees the provisions of the current world trade agreement, resolves trade disputes stemming from it, and hold forums for further rounds of trade negotiations

Question 29

Doha development agenda

Answer 29

Launched in Doha, guitar, in late 2001, this is the ninth, and most recent, round of trade negotiations held by the WTO

Question 30

European Union

Answer 30

An association of European nations that have eliminated tariffs among themselves, establish common tariffs for goods imported from outside the member nations, and allowed the free movement of labor and capital among themselves

Question 31

Euro zone

Answer 31

The 17 nations of the 27 member countries as a 2012 of the European Union that use the euro as the common currency

Question 32

North American Free Trade Agreement or NAFTA

Answer 32

A 1993 agreement astonishing a free-trade zone composed of Canada, Mexico, and the United States