econ midterm 3 Flashcards
A tariff is a tax that is imposed by the ________ country when an __________ good crosses its international boundary
Importing, imported
In industrial countries there is more reliance on __________ as opposed to ______ for government revenue
tax collection, tariffs
an import quota is
a restriction that specifies the maximum amount of a good that may be imported
the fundamental force that drives international trade is
comparative advantage
prior to international trade, if the price of good x is lower in country a than in country b
country a has a comparative advantage in the production of good x
the gains from free trade are enjoyed by a _______ number of people and the costs of free trade are imposed on a ______ number of people
large; small
______ occurs when a foreign firm sells its exports at a lower price than its cost of production
dumping
if a nations central bank increased domestic interest rates, the nations exchange rate would change if the countries exchange rate was
a flexible exchange rate
which one of the following would result in the dollar depreciating against the japenese yen
a fall in the Canadian interest rate
Canada has a comparitive advantage in producing airplanes if
it can produce them at a lower oppurtunity cost than another country
consider a market that sells some of its goods as exports, who does not benefit
Domestic consumers
if canada imposes a tariff on imported cars
the price in canada rises but neither canadas demand curves nor canadas supply curve shifts
suppose the country of mooland imposes tariffs on imported beef from the country of aqualand. as a result of the tariffs the
quantity of beef imported by mooland decreases
the exchange rate is the
price at which one currency exchanges for another currency
tariffs and import quotas differ in that
one is a tax while the other is a limit
economists usually agree with which of the following arguments that
which one of the following transactions would be recorded as a positive entry in the Canadian balance of payment accounts
a french tourist spends $3000 while visiting banff
if the Canadian dollar depreciates it means that
a and c are correct (one Canadian dollar buys less foreign currency, and Canadas nominal exchange rate falls
a tariff on watches which are imported by Atlantis _______ the price of watches in Atlantis and ________
Raises; watch production in Atlantis increase
who benefits from imports
domestic consumers
goods and services that we buy from other countries are our
imports
if a government imposes a quota on imports of a popular doll, the price of the doll in the country ______ and the quantity purchased in the country _______
rises; decreases
the lower the exchange rate the
B, and C (larger is the quantity of Canadian dollars demanded in the foreign exchange market, and smaller is the quantity of Canadian dollars supplied in the foreign exchange market
Canada has a comparitive advantage in producing hardwood if the canadian price of lumber before international trade is ________ the world price
less than
