37.1 Quantitatively,
how important is international trade to the United States relative to
the importance of trade to other nations? What country is the United
States’ most important trading partner, quantitatively? With what
country does the United States have the largest trade deficit?
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37.2 Distinguish
among land-, labor-, and capital-intensive goods, citing an example of
each without resorting to book examples. How do these distinctions
relate to international trade? How do distinctive products, unrelated to
resource intensity, relate to international trade?
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37.3 Explain:
“The United States can make certain toys with greater productive
efficiency than can China. Yet we import those toys from China” Relate
your answer to the ideas of Adam Smith and David Ricardo.
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37.4 Suppose
Big Country can produce 80 units of X by using all its resources to
produce X or 60 units of Y by devoting all its resources to Y.
Comparable figures for Small Nation are 60units of X and 60 units of Y.
Assuming constant costs, in which product should each nation specialize?
Explain why. What are the limits of the terms of trade between these
two countries? How would rising costs (rather than constant costs)
affect the extent of specialization and trade between these two
countries?
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37.5 What
is an export demand curve? What is an import supply curve? How do such
curves relate to the determination of the equilibrium world price of a
tradable good?
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37.6 Why
is a quota more detrimental to an economy than a tariff that results in
the same level of imports as the quota? What is the net outcome of
either tariffs or quotas for the world economy?
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37.7 Draw
a domestic supply-and-demand diagram for a product in which the United
States does not have a comparative advantage. What impact do foreign
imports have on domestic price and quantity? On your diagram show a
protective tariff that eliminates approximately one-half of the assumed
imports. What are the price-quantity effects of this tariff on (a) domestic consumers, (b) domestic producers, and (c) foreign exporters? How would the effects of a quota that creates the same amount of imports differ?
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37.8 “The
potentially valid arguments for tariff Protection –military
self–sufficiency, infant industry protection, and diversification for
stability–are also the most easily abused.” Why are these arguments
susceptible to abuse?
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37.9 Evaluate
the effectiveness of artificial trade barriers, such as tariffs and
import quotas, as a way to achieve and maintain full employment
throughout the U.S. economy. How might such policies reduce unemployment
in one U.S. industry but increase it in another U.S. industry?
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37.10
In
2007, manufacturing workers in the United States earned average
compensation of $30.56 per hour. That same year manufacturing workers in
Mexico earned average compensation of $3.91 per hour. How can U.S.
manufacturers possibly compete? Why isn't all manufacturing done in
Mexico and other low-wage countries?
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37.11 How
might protective tariffs reduce both the imports and the exports of the
nation that levies tariffs? In what wav do foreign firms that “dump”
their products onto the U.S. rnarker ineffect provide bargains to
American consumers? How might the import competition leadto quality
improvements and cost reductions by American firms?
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37.12 Identify and state the significance of each of the following trade-related entities: (a) the WTO; (b) the EU; (c) the Euro Zone, and (d) NAFTA.
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37.13 What
form does trade adjustment assistance take in the United States?
Howdoes such assistance promote political support for free-trade
agreements? Do you think workers who lose their jobs because of changes
in trade laws deserve special treatment relative to workers who lose
their jobs because of other changes in the economy, say, changes in
patterns of government spending?
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37.14 what
is offshoring of white-collar service jobs and how does that practice
relate to international trade?Why has offshoring increased over the past
few decades? Give an example (other than that in the textbook) of how
offshoring can eliminate some American jobs while creating other
American jobs.
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37.15 LASTWORD what was the central point that Bastiat was trying to make in his imaginary petition of the candlemakers?
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