International Economics 18th Edition Test
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Dimension of integration into the world economy - answer-Dependence on
imported materials.
Disadvantage of globalization - answer-American employees can lose their
competitiveness when companies build state-of-the-art factories in low-wage
countries, making them as productive as those in the United States.
True statement about globalization - answer-Globalization consists of the
increased interaction of product and resource markets across nations via
trade, immigration, and foreign investment.
Impact of Technology on Globalization - answer-Increased information flows
have influenced production location decisions.
Increased information flows - answer-Influence production location decisions
by allowing businesses to locate components in various countries while
maintaining a single corporate identity.
Capital flows - answer-Movements in factors of production that measure
economic interdependence, allowing labor and capital to move freely across
nations.
,Criticisms of globalization - answer-Concerns regarding environmental issues,
unfair competition from countries lacking labor standards, and support for
countries with human rights violations.
Bankruptcy of Schwinn bicycle company - answer-Contributed to by foreign
competitors manufacturing bicycles at a lower cost due to hiring low-wage
workers.
Most profound influence driving globalization - answer-Technological change,
rather than increased awareness of global human rights.
Benefits of international trade - answer-Accrue in the form of lower domestic
prices due to global competition and cheap imports keeping inflation in check.
Wage reductions and job export threats - answer-Workers sometimes face
demands for wage reductions from employers threatening to export jobs if
wage reductions are not accepted.
International trade - answer-Has forced domestic firms to become more
competitive in terms of the introduction of new products, product design and
quality, and product price.
Challenges of the international trading system - answer-Includes dealing with
fair labor standards and concerns about the environment, among other
challenges.
,Impact of competition on product quality - answer-International competition
provides domestic producers with a strong incentive to improve the quality of
their products and weakens monopolies.
Globalization - answer-The process of increased interconnectedness among
countries, often debated in terms of its benefits and drawbacks.
Consumption - answer-The use of goods and services by households.
Investment - answer-The allocation of resources, usually money, into projects
or assets with the expectation of generating profit.
Wages - answer-Payments to workers, which tend to rise for those whose skills
are scarcer internationally.
Adam Smith's view on trade - answer-Smith's view of international trade
suggested that trading partners could simultaneously enjoy higher levels of
production and consumption with trade.
Adam Smith's trading principle - answer-Adam Smith's trading principle was
the principle of absolute advantage. A nation will import goods in which it has
an absolute cost disadvantage and export those goods in which it has an
absolute cost advantage.
, David Ricardo's trading principle - answer-Unlike Smith, who emphasized the
importance of absolute cost differences among nations, Ricardo emphasized
comparative (relative) cost differences.
Absolute advantage in production - answer-Spain has a natural advantage
(absolute advantage) in wine production.
Comparative advantage principle - answer-According to the principle of
comparative advantage, specialization and trade increase a nation's total
output because resources are directed to their highest productivity.
True statement about import restrictions - answer-Trade restrictions that
decrease the volume of imports will also decrease exports.
Most of the world's population now lives in nations that are - answer-
integrated or becoming integrated into world markets.
International trade generally - answer-generates income.
Producing goods for export - answer-Generates jobs and income for domestic
workers.
Bank by Robert Carbaugh - Ace Your
Exams!
Dimension of integration into the world economy - answer-Dependence on
imported materials.
Disadvantage of globalization - answer-American employees can lose their
competitiveness when companies build state-of-the-art factories in low-wage
countries, making them as productive as those in the United States.
True statement about globalization - answer-Globalization consists of the
increased interaction of product and resource markets across nations via
trade, immigration, and foreign investment.
Impact of Technology on Globalization - answer-Increased information flows
have influenced production location decisions.
Increased information flows - answer-Influence production location decisions
by allowing businesses to locate components in various countries while
maintaining a single corporate identity.
Capital flows - answer-Movements in factors of production that measure
economic interdependence, allowing labor and capital to move freely across
nations.
,Criticisms of globalization - answer-Concerns regarding environmental issues,
unfair competition from countries lacking labor standards, and support for
countries with human rights violations.
Bankruptcy of Schwinn bicycle company - answer-Contributed to by foreign
competitors manufacturing bicycles at a lower cost due to hiring low-wage
workers.
Most profound influence driving globalization - answer-Technological change,
rather than increased awareness of global human rights.
Benefits of international trade - answer-Accrue in the form of lower domestic
prices due to global competition and cheap imports keeping inflation in check.
Wage reductions and job export threats - answer-Workers sometimes face
demands for wage reductions from employers threatening to export jobs if
wage reductions are not accepted.
International trade - answer-Has forced domestic firms to become more
competitive in terms of the introduction of new products, product design and
quality, and product price.
Challenges of the international trading system - answer-Includes dealing with
fair labor standards and concerns about the environment, among other
challenges.
,Impact of competition on product quality - answer-International competition
provides domestic producers with a strong incentive to improve the quality of
their products and weakens monopolies.
Globalization - answer-The process of increased interconnectedness among
countries, often debated in terms of its benefits and drawbacks.
Consumption - answer-The use of goods and services by households.
Investment - answer-The allocation of resources, usually money, into projects
or assets with the expectation of generating profit.
Wages - answer-Payments to workers, which tend to rise for those whose skills
are scarcer internationally.
Adam Smith's view on trade - answer-Smith's view of international trade
suggested that trading partners could simultaneously enjoy higher levels of
production and consumption with trade.
Adam Smith's trading principle - answer-Adam Smith's trading principle was
the principle of absolute advantage. A nation will import goods in which it has
an absolute cost disadvantage and export those goods in which it has an
absolute cost advantage.
, David Ricardo's trading principle - answer-Unlike Smith, who emphasized the
importance of absolute cost differences among nations, Ricardo emphasized
comparative (relative) cost differences.
Absolute advantage in production - answer-Spain has a natural advantage
(absolute advantage) in wine production.
Comparative advantage principle - answer-According to the principle of
comparative advantage, specialization and trade increase a nation's total
output because resources are directed to their highest productivity.
True statement about import restrictions - answer-Trade restrictions that
decrease the volume of imports will also decrease exports.
Most of the world's population now lives in nations that are - answer-
integrated or becoming integrated into world markets.
International trade generally - answer-generates income.
Producing goods for export - answer-Generates jobs and income for domestic
workers.
