Slides

Question 1

an economic philosophy advocating that countries should simultaneously encourage exports (by subsidies) and discourage imports (by tariffs & quotas) – maintain trade surplus through government intervention

Answer 1

Mercantilism

Question 2

True or False: Principal assertion was that gold and silver were the mainstays of national wealth associated with prestige

Answer 2

True

Question 3

Purchase, sale, or exchange of goods and services across national borders

Answer 3

International Trade

Question 4

ability of a party to produce a greater quantity of a good, product, or service than competitors, using the same amount of resources

Answer 4

absolute advantage (Adam Smith)

Question 5

Condition that results when the value of a nation’s exports is greater than the value of its imports

Answer 5

Trade Surplus

Question 6

refers to a situation where a government does not attempt to influence what its citizens can buy and sell

Answer 6

Free trade

Question 7

an economy’s ability to produce goods and services at a lower opportunity cost than that of trade partners.

Answer 7

Comparative Advantage (David Ricardo)