12 A nontariff barrier which requires an importer or import distributor to buy a certain percentage of products domestically is a: C A) domestic content requirement.

B) government procurement requirement. C) mixing requirement. D) product standard.

13 An arrangement by which the government of an importing country forces foreign governments to limit the number of exports to the importing country is: D A) equivalent to a tariff.

B) called government procurement. C) called product standardization. D) a voluntary export restriction.

14 A(n) ____________________is a limit on the total quantity of imports allowed into a country each year A A) import quota B) tariff

C) nontariff barrier D) import license

15 A policy that products produced and sold in a country must contain a specified minimum amount of domestic production value is a: D A) mixing requirement.

B) product standard requirement. C) tariff quota.

D) local content requirement.

16 When two countries agree to levy tariffs on each other at rates as low as those levied on any other country with whom they trade, they have: A A) granted each other most favored nation status. B) violated WTO regulations. C) settled a WTO dispute.

D) entered into a nontariff barrier to imports.

17 When a country awards import licenses on a first come, first served basis or on a negotiated basis, the country is using a: D A) fixed favoritism system. B) product standard procedure. C) priority negotiation system. D) resource-using procedure.

18 If a country mandates imports to meet certain requirements that may necessitate expensive

modifications be made to the imports, the country is employing: C A) government procurement standards. B) local content requirements. C) product standards requirements. D) illegal import restrictions.

19 When a government's purchasing procedures are biased in favor of domestic products and against foreign products, the nontariff barrier being employed is: B A) an illegal import restriction.

B) a government procurement practice. C) a domestic content requirement. D) a resource-using practice.

20 A non-financial cost of nontariff barriers that is often overlooked is the: D

A) cost to domestic consumers from the increased price that importers have to charge.

B) cost to foreign producers because they must lower their prices to compensate for the cost of the trade barriers.

C) cost of lost tax revenues to the government imposing the nontariff barriers. D) loss of incentive to innovate by firms that are protected by the nontariff barrier.

第十章 1

If the emerging automobile industry in Botswana requests tariff protection because their costs will be temporarily high until the industry is better established, the automobile industry is using the: A) specificity rule. B) infant industry argument. C) externality argument. D) \ 2

Often, governments in developing countries will impose tariffs because tariffs are: A) the best way to protect domestic jobs since imported product will cost more than domestic products. B) the best way to show the rest of the world that the government is stable. C) often the cheapest and most effective means available of generating government revenues. D) the only way to promote domestic production. 3

If the objective of government policy is to protect a domestic industry for national defense

purposes, the best policy strategy is to: A) impose a tariff on imports that compete with the domestic industry's product. B) impose an import quota on imports that compete with the domestic industry's product. C) do nothing. D) provide subsidies to the strategic national defense industry. 4

If the objective of government policy is to redistribute incomes, the best policy strategy is to: A) impose a tariff that favors disadvantaged groups. B) impose an import quota that favors disadvantaged groups. C) address the problem directly with taxes and transfer payments, not with trade policies. D) do nothing. 5

If national pride in the local capability to make a complex product is the objective of government policy, the best policy strategy is to: A) do nothing. B) provide subsidies to this industry. C) impose a tariff on imports that compete with the domestic industry's product. D) impose an import quota on imports that compete with the domestic industry's product. 6

Which of the following represents the incentives at the margin of the first best world? A) SMC>P B) P=SMC=MB=MC=SMB C) P with tax = SMC D) P > SMC 7

Which of the following represents the incentives at the margin of monopoly power? A) SMC>P B) P=SMC=MB=MC=SMB C) P with tax = SMC D) P > SMC 8

If we live in a second-best world in which too much is supplied because suppliers make and sell units for which the social costs exceed the price, then we are living in a world which has: A) external costs. B) external benefits. C) distorting taxes. D) monopolies.

9

There are two ways to promote import-competing production – a subsidy or a tariff. The tariff and subsidy are in many ways the same, except that the tariff will: A) cause a production effect while the subsidy will not. B) cause a consumption effect while the subsidy will not. C) cause less economic inefficiency. D) produce a smaller effect on import consumption in the long run. 10

One of the few arguments which Adam Smith saw as valid for the use of trade protection was the: A) infant industry argument. B) domestic production argument. C) income redistribution argument. D) national defense argument. 11

When private producers reacting to signals of the market price expand production in each country to levels that are as good as possible for the world as a whole, it is said that: A) market distortions result. B) the invisible hand of market competition is at work. C) government must intervene to prevent excessive international trade. D) private consumers must respond. 12

The fact that we live in a \ A) industrialized nations are taking advantage of developing countries. B) free trade is never really accomplished since having all countries cooperate at any one time is impossible. C) the supply of specific products will never match the demand for those products. D) private actions in the markets will not lead to the best possible outcomes for society because of market distortions. 13

____________________ mean(s) that the choices and actions of buyers and sellers in the markets affect others who are not involved in those markets. A) Externalities B) Free rider effects C) Market distortions D) Protectionism 14

Externalities or spillover effects can negatively affect the economy because: A) consumer decisions about product A can adversely affect the profitability of other products that are not directly connected to product A.