Title: Barriers to Trade
Course: TEST Course

Q: Governments may use protectionist policies to ________.
- Increase political power
- lower incomes of producers
- protect domestic jobs
A: protect domestic jobs

Q: Protectionist policies are used by governments in order to ________.
- Increase political power
- lower incomes of producers
- protect their culture
A: protect their culture

Q: Which of these answers is excluded from being an example of trade barriers?
- tariffs
- import quotas
- lower prices
A: lower prices

Q: An example of a nontariff barrier would be ________.
- import quotas
- lower prices
- safety standards
A: safety standards

Q: The country of Xenia has a small segment of electronics firms that have been building up their expertise over the last two years. This year the country began to have cheap electronic goods from its neighboring country Caladonia, flood over its borders. Xenia’s congress is in session and about to vote on implementing new protectionist policies to restrict electronic imported from Caladonia. Which of these reasons would most deftly support Xenia’s congressional actions?
- Xenia needs to protect itself and build its national defense.
- Xenia needs to protect itself and promote its electronics exports.
- Xenia needs to protect itself and protect its infant electronics industry.
A: Xenia needs to protect itself and protect its infant electronics industry.

Q: Westfalia is a country with a conservative population that bases its culture around traditional values and long cultural traditions. This year Westfalia began to have an increase of electronic media, movies and literature from a neighboring country, Dogoni. Dogoni’s culture is broadly different from Westfalia being more liberal and explicit in its media. Westfalia’s parliament is now passing new protectionist policies to restrict or ban electronic media, movies and literature from Dogoni. What reason would most rationally support Westfalia’s government actions?
- Westfalia needs to protect itself and promote its mixed media exports.
- Westfalia needs to protect itself and create a level playing field for its own mixed media industry.
- Westfalia needs to protect itself and build its national defense.
A: Westfalia needs to protect itself and build its national defense.

Q: The Metal Works company receives subsidies from its government to produce its goods. When the Metal Works company generates surplus and begins to export around the world, what may it encounter when trying to sell to countries other than its own country?
- free trade with all other countries with no restrictions
- import quotas from its own government
- protectionist policies in other countries
A: protectionist policies in other countries

Q: If a firm was receiving subsidies from its government to produce and lower its operating costs, what may happen when going to sell its products to other countries?
- No restrictions and free trade with all other countries in a competitive environment.
- Import quotas from its own government allowing it to only produce a certain amount..
- Other countries enacting protectionist policies to protect their own countries goods.
A: Other countries enacting protectionist policies to protect their own countries goods.

Q: Assume that the U.S. produces mangoes in California and also imports them from India. India produces mangoes at a lower cost. Instead of a free trade environment in the U.S., a quantity quota is imposed by the U.S. government. The quota on mangoes from India will
- lower the price of mangoes in the U.S., and lower the quantity of mangoes sold in the U.S.
- keep the price of mangoes the same in the U.S., and increase the quantity of mangoes.
- lower the price of mangoes in the U.S., and increase the quantity of mangoes sold in the U.S.
A: lower the price of mangoes in the U.S., and increase the quantity of mangoes sold in the U.S.

Q: The U.S. produces strawberries in Oregon, but also imports strawberries from Chile. The production costs are lower for strawberries from Chile. Instead of a free trade environment in the U.S., the U.S. government has imposed a value quota. What will the quota on strawberries from Chile do to the U.S. market?
- Lower the price of strawberries in the U.S., and lower the quantity of strawberries sold in the U.S.
- Keep the price of strawberries the same in the U.S., and increase the quantity of strawberries.
- Lower the price of strawberries in the U.S., and increase the quantity of strawberries sold in the U.S.
A: Lower the price of strawberries in the U.S., and increase the quantity of strawberries sold in the U.S.

Q: The U.S. has been importing baby toys from China, but this year kids are getting sick from these toys. After testing the toys high dosages of lead are found in the paint used on these toys. The U.S. government now bans the import of these baby toys from China until they are deemed safe again. This is an example of a ________.
- tariff barrier
- quantity quota barrier
- nontariff barrier
A: nontariff barrier

Q: The European Union (EU) has been importing beef from the U.S. for decades, but over the last decade the U.S. has ramped up its genetically modified beef program. There has been not enough testing on the effects of this change to cows over a significant length of time so the EU now bans the import of beef from the U.S. What is this an example of with regards to protectionism?
- a tariff barrier
- a value quota barrier
- a nontariff barrier
A: a nontariff barrier

Q: An example of a tariff would be ________.
- rules and regulations placed on a good
- a limit on the number of a good imported into a country
- a tax on an imported good
A: a tax on an imported good

Q: Which of the following is an example of a tariff?
- The regulations and rules placed on a good.
- A limit on the way a good is produced before it is imported into a country.
- The tax on an imported good.
A: The tax on an imported good.

Q: Which area in the graph below illustrates the loss to domestic shoe producers if the government decided against placing a tariff on foreign shoes?
- C
- C+F
- B+C
A: B+C

Q: Which area in the graph below illustrates the gain to domestic shoe producers as a result of a government placing a tariff on foreign shoes?
- B+C
- C+F
- C
A: C

Q: Use the graph below to identify the loss to consumers from the tariff on foreign shoes.
- F+G
- F+D+E+G
- C+F+D+E+G
A: C+F+D+E+G

Q: Use the graph below to identify the government revenue from the tariff on foreign shoes.
- D
- F+D+E+G
- D+E
A: D+E

Q: Over time, the average worker gains from reduced trade barriers through ________.
- more choices and greater variety
- lower productivity and lower wages
- greater productivity and higher wages
A: greater productivity and higher wages

Q: Over time, the average consumer will be better off from reduced trade barriers by ________.
- greater productivity and higher wages
- less variety and higher prices
- greater variety and lower prices
A: greater variety and lower prices

Q: International trade policies benefiting from specialization and comparative advantage can make the average worker better off, but a tradeoff is ________.
- worker productivity could go down
- consumers could pay more for products
- workers could lose their jobs
A: workers could lose their jobs

Q: What is the tradeoff for the average worker when it comes to international trade policies in specialization and comparative advantage?
- There is the possibility that the productivity of workers could go down.
- There is the possibility that consumers would pay more for products.
- There is the possibility that workers could be laid off from their job.
A: There is the possibility that workers could be laid off from their job.

Q: An example of a disruptive market change is ________.
- a new type of automobile
- a new brand of cereal
- new technology
A: new technology

Q: Which of the following is an example of a disruptive market change?
- a new type of motorcycle
- a new brand of oatmeal
- new technology
A: new technology

Q: The island country of Mauritius is small but has lowered its barriers for international trading partners. Its location in the Indian ocean is close to Madagascar and the African continent. Mauritius trades between countries close by, and larger countries such as India. How does Mauritius benefit from lowering its trading barriers?
- Its economy produces all the goods and services the country requires and thus helps the local business grow.
- It maintains a very high standard of living because of the domestic dominance over other products and services.
- Workers and companies can now specialize in competitive areas because other goods and services are imported through international trade.
A: Workers and companies can now specialize in competitive areas because other goods and services are imported through international trade.

Q: The small country of Benin has many international trading partners between not only countries close by, but also larger countries such as the U.S. What is one of the benefits that Benin receives from lowering its trading barriers?
- The economy needs to produce goods and services that the country requires.
- It receives a fixed quantity of goods and services which supply the population by limiting the number of goods and services available.
- Workers and firms in the country can now specialize in areas because other goods and services are found through trade.
A: Workers and firms in the country can now specialize in areas because other goods and services are found through trade.