Eco Final Exam Study Guide

Question 1

The slope of the trade line is equal to the

b. world price of the good on the horizontal axis.

Question 2

For China

c. economic reforms were intended to create more wealth to distribute, not do undo the communist party.

Question 3

Monopoly powers given to domestic utility companies to create economies-of-scale might unintentionally

a. be an obstacle to increased international trade.

Question 4

Tijuana, Mexico is across the border from San Diego, California. It has become a world-leading producer and exporter of television sets and computer monitors, which it assembles in modern factories owned by multinational consumer electronics firms such as Sony. Initially, these electronics were produced in the industrialized countries of their parent companies, and after several years, the production moved to Tiajuana This is an example of

a. the product cycle.

Question 5

The "Four Freedoms" do NOT include the right to

a. vote in local elections.

Question 6

What is the best explanation for why China and India have received so much international interest and foreign investment?

a. Their large populations

Question 7

When expansionary fiscal and monetary policies are joined with a __________ exchange rate system, the various components of economic policy often interact in ways that lead to a crisis followed by a steep recession

c. crawling peg

Question 8

Suppose the dollar is subject to a floating exchange rate system and that R is the number of dollars per unit of foreign exchange. If R increases, then the dollar

a. depreciates.

Question 9

Requiring a firm with international operations to follow the standards of its home country instead of those of the foreign country has all of the following advantages except

e. it is a comprehensive measure, since it addresses the problem of production in foreign firms as well as firms from high-standards countries that relocate abroad.

Question 10

Which of the following is...