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30 Cards in this Set
- Front
- Back
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For which nation does international trade account for its largest Gross $$ Product
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Holland (Netherlands)
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The US major imports are
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industrial supplies
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Top two main categories of US imports
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consumer goods and industrial supplies
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Top categories of major US exports
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capital goods and services
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The US largest trade partner
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Canada
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Two US major trading partners are
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Mexico and Canada
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Exports account for what percentage of the US total GDP
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11%
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US is a major exporter of
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transportation
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What does AUTARKY mean?
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self-sufficient
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Comparing import/export advantages, how do you measure cost
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opportunity cost
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Trading is most likely to occur when?
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each of the trading nations gain from the trade
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The basis of specialization is..
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comparative advantage
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When does a country have and absolute advantage
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when a country can produce more of two goods than another country can
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What is the basis of international trade
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comparative advantage
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What are terms of trade?
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the rate at which two countries trade one good for another.
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Comparative advantage is determined by
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opportunity cost
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Differences in resource endowments are differences in what?
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Quality and quantity of resources available in different countries
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Differences in taste among countries does what?
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Makes gains from trade possible even in the absence of differences in resource endowment
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with no other trade restrictions, a country will import a good when..
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When there is an excess in quantity domestic demanded at the world price
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What are tariffs?
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taxes on imported goods
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What is the world price of goods?
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the price at which it is traded internationally
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What is an import quota?
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a legal limit on the amount of a specific good that can be imported
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What does the World Trade Organization (WTO) do?
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supervises international trade in merchandise and services
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Under the "most favorite" clause, WTO members must do what?
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they must offer the same trade concessions to all member nations
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What is the largest regional trading block in the world?
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The European community
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What was the US motive in negotiating a free trade agreement with Mexico?
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To encourage Mexico to achieve a more market oriented economy
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Give five arguments in favor of restrictive trade
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National Defense
Infant Industry Anti-Dumping efforts Jobs and income effects Declining industry |
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What is "dumping" in economics?
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Selling a commodity abroad lower than the domestic price
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In the US, what law prevents dumping?
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Trade Agreement Act of 1979
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Who are the losers when when the US institutes trade restrictions?
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US consumers of imported goods
US producers who use imported intermediate goods And when other countries retaliate, US exporters |
