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GATT is an example of a successful unilateral approach to achieving free trade.

A) True
B) False

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The greater the elasticities of supply and demand,the smaller are the gains from trade.

A) True
B) False

Correct Answer

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Domestic consumers gain and domestic producers lose when the government imposes a tariff on imports.

A) True
B) False

Correct Answer

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Policymakers often consider trade restrictions in order to protect domestic producers from foreign competitors.

A) True
B) False

Correct Answer

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The small-economy assumption is necessary to analyze the gains and losses from international trade.

A) True
B) False

Correct Answer

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When a country that imports shoes imposes a tariff on shoes,buyers of shoes in that country become worse off.

A) True
B) False

Correct Answer

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Tariffs cause deadweight loss because they move the price of an imported product closer to the equilibrium without trade,thus reducing the gains from trade.

A) True
B) False

Correct Answer

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If a country allows free trade and its domestic price for a given good is lower than the world price,then it will import that good.

A) True
B) False

Correct Answer

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