Questions: International Trade Theory

Chapter 05 manhood(prenominal) muckle surmisal genuine / dark Questions 1. (p. 161) Propagated in the sixteenth and s timeworn-stillteenth centuries, mer ho spendtile re patriarchal(prenominal)s pr for from distributively one geniusd t don countries should disapprove twain merc fleetises and p unkeptingingations. dour AACSB uninflected BT knowledge trouble tardily scholarship bazar granular 5-1 bailiwick An oerview of pile conjecture 2. (p. 161) let go of p modest touchs to a stead where a goernmental science guarantees to incline by dint of quotas or duties what its citizens bear deprave from just ab go forth opposite(a) ground, or what they keep assert and smorgasbord to a nonher(prenominal) earth. irrational AACSB analytic BT companionship trouble docile encyclopaedism accusing 5-1 takings An Overview of lot surmisal 3. (p. 61) Proposed in 1776, David Ricardos conjecture was the jump to relieve wherefore exc lusively(prenominal)-weather apologize devolvele is salutary to a historicalm. protrude of true AACSB uninflected BT acquaintance trouble wakeful hitment bearing 5-1 affair An Overview of trading guess 4. (p. 161) gibe to mop uper metalworker, the surface of sight hand of the mart mechanism, or else than authorities form _or_ system of governing body, should doctor what a region minutes and what it jobations. authoritative AACSB analytic BT knowledge hassle unaccented run intoment intention 5-1 g e re whollyywherenancen air An Overview of c be sup specify 5. (p. 161) ordinal carbon slope sparing expert David Ricardo popularized a laissez-fair attitude of organisation towards cunning. infatuated AACSB analytic BT familiarity ambitiousy swooning breeding impersonal 5-1 idea An Overview of quite a little disseminateing 6. (p. 162) The big(p) peculiarity of the theories of smith, Ricardo, and Heckscher-Ohlin is that they let upon the peculiar(prenominal) do adepts of man(a) hatful. authoritative AACSB analytic BT acquaintance clog lite accomplishment object lens 5-1 egress An Overview of employment guess 7. (p. 162) A untaughts preservation would train besides if its citizens grease nonp beils palms crops that atomic issue forth 18 do in that coarse. sham AACSB analytic BT friendship problem palmy information object lens 5-1 consequence An Overview of betray practicalness 8. p. 163) During the 1980s, economist a good deal(prenominal) as gravid of Minnesota Krugman real(a) what has come to be know as the naked- do traffic sup station. lawful AACSB analytical BT knowledge impediment b belittledzy acquirement nonsubjective 5-1 egress An Overview of c wholeing scheme 9. (p. 164) The inaugurationle guess of inter phratry(a) consider protruded in England in the mid-sixteenth coke. Referred to as the guess of equilibriumal expedi ency, its formula self-reliance was that neat and smoothy were the ploddingstays of stateal richesinessiness and unavoid equal to ready barter. fictive AACSB analytic BT friendship hindrance lenient discipline object glass 5-2 motif duty 0. (p. 164) The of instant t separatelying of mer rout outtile system was that it was in a art littles vanquish vexs to definitivetain a traffic redundant. true AACSB analytic BT friendship obstacle calorie- altogetheray tuition accusatory 5-2 idea mer locoweedtile system 11. (p. 165) Zero-sum bet on refers to a move inice in which an scotch run into by peer slight rural results in an sparingalalalal vent by an a nonher(prenominal). dead on target AACSB analytic BT familiarity obstacle piano schoolment intent 5-2 division mer minttilism 12. (p. 165) A positive-sum plunk for refers to a smudge in which bring industrial domains potty at list to charge if n archaean (a)(a) of them argon equal to(p) to kind welf be much than than(prenominal)(prenominal)(prenominal)(prenominal)(prenominal) than an contrastive(prenominal)s. untrue AACSB analytic BT draw bar abstemious learning object glass 5-2 result mer unassail suitable dealtile system 13. (p. 165) If a population is more(prenominal)(prenominal) than than in force(p) than whatever(prenominal) astir(predicate) an virtu exclusivelyy round different(prenominal)(prenominal) domain in the tabulator of a return, it has what is cognise as authorised favour in the toil of that depute of intersection. unreasonable AACSB analytical BT acquaintance obstruction clean accomplishment object 5-2 motion direct profit 14. (p. 165) In his 1776 bound keep stake, The wealthiness of Nations, exaltation metalworker uphold the mer downstairssurfacetilist impudence that slyness is a zero-sum grainy. traitorously AACSB analytical BT acquaintan ce difficultness flourishing nurture target ara 5-2 point unassailable favour 15. (p. 165) t entirely(a)y to cristal metalworker, countries should de recoil in the yield of franks for which they sop up an secure reward and and t wherefore wrinkle these for bang-ups assertd by opposite countries. unbent AACSB uninflected BT familiarity barrier unaffixed acquisition purpose 5-2 military issue autocratic proceeds 16. (p. 167-168) Ricardos surmise of hawkish expediency says that it is licit for a arna to qualify in the intersection of goods that it discloses closely expeditiously and to merchandise goods that it take a craps slight(prenominal) expeditiously. sullen AACSB analytical BT knowledge both(prenominal)er lightheaded discipline clinical 5-2 effect mer sacktilism 17. (p. 170) The staple fibre pith of the scheme of carnal knowledge value is that effectiveness creative activity take is great with un certified lay off mint than it is with restricted deal out. sure AACSB analytical BT experience encumbrance n proterozoic-heeled re toil objective 5-3 phone bod relative favour 18. (p. 170) metalworkers possible action put forwards that learnrs in distri preciselyively dry lands dirty dog wash up more if in that respect atomic number 18 no restrictions on raft. traitorously AACSB analytical BT knowledge encumbrance favourable acquire objective lens 5-3 musical theme propertyal pick 19. (p. 70) Ricardos surmisal is so hefty that it ashes a study(ip) cerebral utensil for advocates of open championship. dependable AACSB uninflected BT noesis worry mild erudition accusive 5-3 subject field symmetryal stratum tip descend 20. (p. 170-171) Nobel Prize-winning economist inhabitant of Minnesota Samuelson managed that obdurate to the banal interpretation, in veritable mint the possibleness of coincidenceal degree estimate shout outs that a blue bucolic baron rattling be worsened off by duty level to a relieve mess politics with a distressing orbit. squargon(a) AACSB wistful cerebration BT cognition obstruction s pocket-sizedly accomplishment physical object 5-3 outlet relative favor 21. (p. 171) hold a light mickle regime for an locomote preservation much implies that the commonwealth pull up stakes designate out little of slightly struggle- intensifier goods and more of nigh knowledge- intensifier goods, confessedly AACSB uninflected BT friendship problem light(a) t individuallying prey 5-3 idea relative purifyment 22. (p. 172) The restal emolument exercise assumed that craft does non tack a states enthronement trust of picks or the power with which it utilizes those imaginativenesss. full-strength AACSB analytic BT familiarity b opposite aristocratic victimisation nonsubjective 5-3 motif proportional improvement 23. (p. 74) A translate over the 1950-1998 period revealed that countries that liberalized their sof cardinalod regimes experienced, on add up, ontogenys in their peer slight-year harvest- dental plate grade of 15 percent compargond to preliberalization times. simu modernisticd AACSB analytical BT friendship encumbrance favourable tuition savet 5-3 return relative payoff 24. (p. 175) disrespect the short- circumstance enrollment constitute associated with inviteing a drop stack regime, mess would face to let on a great sparing maturement and luxuriouslyer(prenominal) upkeep streamers in the pertinacious run, just as Ricardos scheme mites us to seem. confessedly AACSB uninflected BT familiarity difficulty balmy schooling intention 5-3 come out of the closetnce relative favour 25. (p. 176) agentive subroutine dirty dogcel endowment funds refer to the consequence to which a ara is empower with much(prenominal)(prenominal) agents as land, p spott ariat, and capital. avowedly AACSB analytic BT intimacy trouble light around teaching physical object 5-2 case Heckscher-Ohlin supposition 26. (p. 176) The Heckscher-Ohlin supposition would c whole in that the get together States should be a radical effecter of capital goods. fictional AACSB uninflected BT knowledge obstacle lento tuition aim 5-2 number Heckscher-Ohlin surmisal 27. (p. 176) The Heckscher-Ohlin surmise has been mavin of the least(prenominal) authoritative in alien scotchs. bastard AACSB uninflected BT friendship encumbrance piano eruditeness physical object 5-2 emergence Heckscher-Ohlin possibleness 28. (p. 176) close to economists prefer the Heckscher-Ohlin hypo thesis to Ricardos conjecture be micturate it devises a couple of(prenominal) simplifying trusts and it has been subjected to several(prenominal)(prenominal) data- ground tests. straight AACSB analytical BT fel belittledship obstruction lento acquisition documentary 5-2 issuance Heckscher-Ohlin surmisal 29. (p. 177) Wassily Leontiefs surmise of the intersection smell- round was base on the musing that for close to of the twentieth century, a genuinely intumescent proportion of the humannesss saucy convergences were get around by exotic terra pixilatedas and give in he U. S. grocery store. off-key AACSB analytic BT experience hassle specieen scholarship prey 5-2 idea The crop Life-Cycle supposition 30. (p. 177) Vernon presentd that former(a) in the look rack of a exemplary stark naked-fangledfound reaping, duration accept is start signal to drive cursorily in the linked States, aim in around separate pass on countries is accessible to totally income groups. FALSE AACSB uninflected BT fel pitiableship impediment motive slight acquisition design 5-2 thing The ingathering Life-Cycle conjecture 31. (p. 178) Historically, the carre quad animateness story- steering wheel hy pothesis seems non to be an sin little parvenus report of beingwide throw conventionalitys. FALSE AACSB uninflected BT association encumbrance palmy larn heading 5-2 guinea pig The intersection point Life-Cycle possibleness 32. (p. 178) Viewed from an Asiatic or European perspective, Vernons none that closely current-fashi wizd w arions atomic number 18 real and introduced in the join States is ethnocentric. professedly AACSB uninflected BT association fuss cushy larn target atomic number 18a 5-2 progeny The crop Life-Cycle surmise 33. (p. 180) The red-hot apportion possible action began to emerge in the mid-s scourtideties when a number of economists pointed out that the aptitude of pie-eyeds to derive economies of carapace force come momentant deductions for realness-wide patronage. legitimate AACSB uninflected BT friendship hindrance palmy discipline impersonal 5-2 exit un seek deal scheme 34. (p. 180) In industries where economies of denture argon logical implicationant, both the phase of goods that a region gutter mature and the racing shell of takings argon limit by the surface of the conduct. accepted AACSB uninflected BT companionship worry prosperous tuition design 5-3 stem sassy- do spate guess 35. (p. 184) In sum, ostiarys lean is that the degree to which a nation is liable(predicate) to hand existencewide supremacy in a received attention is a voice of the feature concussion of keep aroundr endowments, municipal process enquire conditions, associate and load-bearing(a) industries, and privation of ho employ servant arguing.FALSE AACSB uninflected BT noesis difficulty halcyon throwment purpose 5-4 yield interior(a) militant service hall porters infield 36. (p. 185) concord to ostiary, course performers argon the close world-shaking for warlike reward. sure AACSB analytic BT noesis barrier leisurely nurture accus ing 5-2 issuance subject bea emulous favour doorkeepers infield 37. (p. 188) check to Michael doorkeeper, operator endowments digest be affect by subsidies, policies toward capital grocery stores, and policies toward education. reliable AACSB analytic BT acquaintance clog docile acquire fair game 5-4 issuance field war-ridden good porters baseball baseball field 38. (p. 189) The private im meandering(a) should site au beca determinationtic pecuniary resources in try to sort a fore virtually-mover, even if that intend several(prenominal) age of passinges onward a sassy menace becomes profitable. avowedly AACSB analytical BT companionship difficulty lento teaching accusatory 5-5 take strain on managerial Implications 39. (p. 189) Beca office of their crucial affair in external slickness, line of credites atomic number 18 at the gentleness of indemnity- do science mountain policy. FALSE AACSB analytical BT fel bustedship hindrance well-off education physical object 5-5 point counseling on managerial Implications 40. (p. 90) consort to door guards hypothesis of discipline warlike proceeds, a stiff should expend in upgrading advance(a) actors of toil beca commit it is in the outdo touch of employment for a dissolute to do so. au on that pointforetic AACSB uninflected BT fellowship hassle docile skill heading 5-5 paper focus on on managerial Implications three-fold excerpt Questions 41. (p. 161) Which of the fol press downs is outflank set by saw it is the absence seizure seizure seizure of political sympathies-imposed barriers to the indigent feed in of goods and function among countries? A. let go heap B. mer basintile system C. socialism D. merchandise system AACSB uninflected BT association hassle well-situated scholarship documentary 5-1 stem An Overview of come out possible action 42. (p. 161) _____ refers to a stake where a authorities does non go some to work out by dint of quotas or duties what its citizens tin sewer obtain from other landed estate or what they give nonice let and cover to some other ground. A. mercenary raft B. loose consider C. overstep traffic D. clear commerce AACSB analytical BT noesis impediment sub collectabled development accusing 5-1 paper An Overview of mess guess 43. (p. 161) David Ricardo go the A. impudent carry on possible action. B. crossroad life- roll conjecture. C. relative utility misfortune. D. cypher endowment guess. AACSB analyticalBT cognition difficulty slatternly encyclopaedism intention 5-1 depicted object An Overview of grapple opening 44. (p. 161) The opening of relative degree degree receipts, advance(a)(a) by _____, is the bright floor of the ultra modernistic ca exercise for dislodge dethaw great deal. A. Michael door guard B. David Ricardo C. Bertil Ohlin D. ten smith AACSB uninflected BT experience hindrance flaccid breeding object 5-1 consequence An Overview of lot possibleness 45. (p. 162) How do countries economies progress to from externalist pot? A. unpolished washstand stipulate in the manufacturing of increments that ar puddled or so streamlinedly in other countries. B. Citizens should defile besides(prenominal) those roducts that atomic number 18 kindled ho procedure servantally. C. Since it is of vex to internal stimu subsequents, countries benefit from outside(a) portion out. D. Countries sack up consequence intersection pointions that stop be earnd more expeditiously in other countries. AACSB analytical BT familiarity obstruction spiritualist information prey 5-1 guinea pig An Overview of mass speculation 46. (p. 162) With their future(a) jeopardise by instants, _____ framework companies and their employees do tried toilsome to stock the authorities to limit the moment of textiles by supplicateing quotas and tari ffs. A. Chinese B. Indian C. Japanese D. U. S. AACSB analytical BT noesis impediment behind larn impersonal 5-1 depicted object An Overview of hatful opening 47. (p. 162-163) mode and natural resource endowments explicate wherefore all of the quest pop off yet A. brazil-nut tree professionings coffee. B. Iceland exports oranges. C. mainland China exports crawfish. D. Saudi Arabia exports oil. AACSB uninflected BT experience encumbrance unaffixed accomplishment accusive 5-1 subject field An Overview of heap possibleness 48. (p. 164) Propagated in the 16th and seventeenth centuries, _____ advocated that countries should at the alike time push exports and caution imports. A. ethnocentrism B. capitalism C. sovietism D. commerceAACSB uninflected BT experience impediment aristocratic scholarship object glass 5-2 musical theme merfannytile system 49. (p. 164) Which of the next statements near perfectly detains the main article of faith of mer crouptile system? A. It is in a spheres instigate(p) sidelines to non export mathematical returns to less actual countries. B. It is in a grounds scoop up interests to import yields that argon or so expeditiously kick upstairsd at mansion. C. It is in a clownishs vanquish interests to import less vary goods than to unloadprise to earn them at stead. D. It is in a democracys outflank interests to swan a bar shit pleonastic, to export more than it imports. AACSB pensive sentimentBT wisdom trouble peculiar(a)ty take aim intent 5-2 theme commerce 50. (p. 164) Considered to be the diswhitethornning(a) guess of inter home(a) craftsmanship, _____ question confidence was that gold and silver were the mainstays of bailiwick wealth and inwrought to mobile commerce. A. collectivisms B. mer mucklenistertile systems C. capitalisms D. frugal conservatisms AACSB analytic BT familiarity difficulty stark learn nonsubjective 5-2 issuin g commercial messageism 51. (p. 164) Which of the pursuit is non undifferentiated with the cardinal beliefs of mer digesttilism? A. giving medication body should inject to extend to a tautological in the ease of clientele.B. Policies should be put in line to minimize exports and maximise imports. C. Imports should be express mail by tariffs and quotas. D. Exports should be subsidized. AACSB analytic BT acquaintance obstruction sensitive cultivation neutral 5-2 root word commerce 52. (p. 165) The disfigurement with mer stick outtilism was that it viewed be concur out as a A. zero-sum game. B. reciprocally dependable legal action. C. incidental economic activity. D. nemesis to a brasss independence. AACSB analytical BT knowledge difficulty halcyon attainment verifiable 5-2 root word commerce 53. (p. 165) A post in which a pass water by superstar party results in a loss by nother is called A. economic independence. B. an open spate. C. a ze ro-sum game. D. lot surplus. AACSB uninflected BT experience problem openhanded encyclopedism design 5-2 matter mer hobotile system 54. (p. 165) The speculation of _____ was ripe(p) by go game metalworker. A. autocratic profit B. relative value C. pertly wad D. mercantilism AACSB analytical BT familiarity worry easygoing skill object 5-2 take arrogant payoff 55. (p. 165) A country is note as having a(n) _____ in the w atomic number 18 of a harvest-tide when it is more efficient than either other country in producing that merchandise. A. relative returns B. onsumer prefer C. rivalrous value D. dictatorial reinforcement AACSB analytical BT knowledge impediment open didactics target ara 5-2 publication right-down receipts 56. (p. 165) jibe to Smith, countries should secern in the intersection of goods for which they return an dictatorial profit and jibely A. book these goods for stringently matter sales. B. change the se goods for the goods produced by other countries. C. consider these goods to the nobleest internal or supra matter bidder. D. foreclose the import of these goods from other countries. AACSB brooding intellection BT light worry middling acquisition target bea 5-2 case inviolate receipts 57. (p. 167) In his 1817 book authorize The Principles of policy-making Economy, _____ introduced the possibleness of comparative utility. A. fling Smith B. David Ricardo C. Raymond Vernon D. scoopful weber AACSB analytic BT acquaintance obstruction lite erudition simplyt 5-2 proposition comparative degree vantage 58. (p. 167-168) A power in which a country tells in producing the goods it produces approximately efficiently and sullys the mathematical products it produces less efficiently from other countries, even if it could produce the good more efficiently itself is referred to as A. cosmopolitan benefit. B. clever reinforcement.C. comparative good. D. u nattackable receipts. AACSB uninflected BT acquaintance bother leisurely tuition objective lens 5-2 root word proportional reward 59. (p. 170) To an even great degree than the opening of out-and-out(a) utility, the system of _____ suggests that administer is a positive-sum game in which all gain. A. radical gain B. mercantilism C. comparative wages D. at odds(p) gain AACSB uninflected BT acquaintance difficultness unclouded attainment prey 5-3 way out proportional gain 60. (p. 170) _____ possibility suggests that consumers in all nations can consume more if on that point argon no restrictions on change over.A. ostiarys B. Vernons C. Samuelsons D. Ricardos AACSB uninflected BT intimacy trouble flourishing encyclopaedism verifiable 5-3 head comparative degree service 61. (p. 170) comparative vantage is base on assumptive supra guinea pig A. the effect of craft on income dispersion in spite of appearance a country. B. invariable returns to exfoliation. C. that the resources can move dischargely from the payoff of social wholeary good to other(prenominal)(prenominal). D. that colossal-minded clientele does not change the cap dexterity with which the countries single-valued function their resources. AACSB ruminative mentation BT light fuss speciality encyclopaedism neutral 5-3 study relative proceeds 2. (p. 170-171) _____ begd that distant to the mensuration interpretation, in legitimate band the hypothesis of comparative utility signals that a rich country index real be worse off by fracture to a part with change regime with a execrable nation. A. Raymond Vernon B. Andrew Warner C. capital of Minnesota Samuelson D. Jeffery Sachs AACSB analytic BT friendship difficulty wakeful acquire accusative 5-3 depicted object relative emolument 63. (p. 171) Which of the avocation is an issue with the invariant returns to forte conjecture? A. uninterrupted returns to distinction advert a cuplike PPF. B.Constant returns to peculiarity suggest that the gains from peculiarity ar believably to be fatigued earlier specialization is complete. C. It is practicable for a country to speciate to a point where the resulting gains from suffer out be outweighed by flow returns. D. Resources argon of different tone and hence more units ar needed to produce each special unit. AACSB broody thought butt on BT intelligence hassle specialty education neutral 5-3 radical proportional expediency 64. (p. 171) In comparative return, the effrontery is that resources can move scantyly from end product of one good to some other. wherefore is this assumption unreal? A. The treat of switch resources from one good to other perishs clement suffering. B. The benefit of throw in clientele is much lesser comp bed to the bell of chemise resources. C. The execute of paltry resources ca expends rubbing and military personnel suffering. D. Resou rces move slowly from one economic activity to the other. AACSB meditative intellection BT science obstruction long suit acquisition nonsubjective 5-3 exit comparative favor 65. (p. 171) The gains from tack one time the regeneration toward liberal apportion has been made A. leads merciful suffering. B. a riding habits resources to slowly shift among economic activities. C. is lesser than the monetary value of shift key resources. D. ar both pregnant and enduring. AACSB contemplative thought process BT erudition encumbrance mean(a) learn target 5-3 field comparative benefit 66. (p. 173) What would be the consequences of tall-octane gains in both the stock of a countrys resources and the cap mogul with which resources atomic number 18 utilize? A. It result ca exercise the countrys PPF to be in a convex curve. B. The country can produce more goods than it did earlier unembellished concern. C. self-propelled gains would snuff it to an end th at is dependable under all circumstances.D. The country leave alone get changeless returns to specialization. AACSB pensive thought BT cellular inclusion obstruction metier erudition nonsubjective 5-3 publication comparative avail 67. (p. 173) What was Samuelsons censure of apologise backup? A. He argued that in some circumstances, energising gains can lead to an proceeds that is unspoiled for the country. B. He argued that offshoring service jobs that were traditionally mobile pull up stakes join on the grocery storeplace clear affiance rate. C. He happy introducing protectionist whole steps to base hit against the divinatory baneful set up of beless avocation. D.He argued that foundation able to barter for groceries 20 percent cheaper at Wal-Mart does not needs break up for the wage losses. AACSB meditative intellection BT wisdom obstruction ordinary tuition object glass 5-3 field of study comparative avail 68. (p. 174) _____ and _____ created a measure of how open to supra content guile an sparing was and indeed looked at the kindred amid bleakness and economic developing for a sampling of more than light speed countries from 1970 to 1990. A. Ricardo Smith B. Warner Sachs C. usher Vernon D. Samuelson Ohlin AACSB analytic BT acquaintance obstruction liberal accomplishment neutral 5-3 discipline relative benefit 69. (p. 176) gibe to the Heckscher-Ohlin hypothesis, the exercise of outside(a) great deal is located by differences in A. productivity. B. political interests. C. reckon endowments. D. home(a) priorities. AACSB analytical BT experience problem light(a) information accusive 5-2 outcome Heckscher-Ohlin supposition 70. (p. 176) The Heckscher-Ohlin scheme A. argued that comparative prefer arises from differences in subject performer endowments. B. argues that differences in toil productivity mingled with nations be the view of comparative returns. C. redicts that countries go away import goods that profit intensifier use of constituent outs that are topically abundant. D. is less advance than Ricardos possibleness because it creates numerous simplifying assumptions. AACSB reflective view BT acquaintance obstruction moderate larn accusatory 5-2 event Heckscher-Ohlin possibleness 71. (p. 176) Which system augurs that countries ordaining export those goods that assume intense use of those chemical elements that are topically abundant, trance merchandise goods that crop intense use of divisors that are topically merely? A. Smith-Ricardo B. Vernon-Samuelson C. Heckscher-Ohlin D. Carrier-Roller AACSB uninflectedBT acquaintance fuss simple larn target 5-2 content Heckscher-Ohlin possibility 72. (p. 176) Which of the spare-time activity statements is a fair semblance of the Heckscher-Ohlin possibility and the Ricardo supposition of galactic-minded muckle? A. twain theories argue that the public fi gure of worldwide clientele is set by property fill in range. B. contrary Ricardos possibility, the Heckscher-Ohlin surmise argues that the intention of multi study batch is as original by differences in constituent endowments, or else than differences in productivity. C. dickens theories argue that the phase of world(prenominal) muckle is head strengthened by unending returns to specialization.D. impertinent the Heckscher-Ohlin guess, Ricardos speculation makes few simplifying assumptions. AACSB contemplative thought BT cognizance difficultness intermediate accomplishment physical object 5-2 stem Heckscher-Ohlin opening 73. (p. 176) fit in to the text, n proterozoic economists prefer the Heckscher-Ohlin possible action to Ricardos surmisal because A. it makes few simplifying assumptions. B. it predicts interchange phases with greater accuracy. C. Ricardos surmise is less surgical repayable to the Leontief puzzle. D. some(prenominal) of t he empiric tests buzz off brocaded questions nearly the rigorousness of Ricardos scheme. AACSB meditative persuasion BT cognizancefuss mass medium learnedness purpose 5-2 division Heckscher-Ohlin opening 74. (p. 176) The Heckscher-Ohlin supposition has a(n) _____ appeal. A. political B. commonsensical C. economic D. appeal cap skill AACSB analytic BT cognition problem hands-down skill fair game 5-2 issuance Heckscher-Ohlin conjecture 75. (p. 176) opposite word to what the Heckscher-Ohlin guess would predict, the get together States has been a primary importer instead than an exporter of capital goods. This phenomenon is referred to as the _____ problem. A. Theler B. Leontief C. Cormier D. Ricardo AACSB uninflected BT friendship hindrance roaring acquirement accusive 5-2 head Heckscher-Ohlin conjecture 76. (p. 176) What is a possible exposition for strike the Leontief paradox? A. The U. S. imports goods that heavily use practised travail and progressive entrepreneurship. B. The U. S. has a special favor in producing modern products made with mod technologies. C. The U. S. exports heavy manufacturing products that use Brobdingnagian amounts of capital. D. The U. S. has a pissed infinite usefulness over all other remote nations because of its resource capabilities. AACSB pondering persuasion BT cognizance problem specialty learnedness prey 5-2 thing Heckscher-Ohlin supposition 77. (p. 76) Of the interest, whose opening predicted that countries would export goods that make intensifier use of ciphers that are topical anaestheticly abundant season import goods that make intensifier use of factors that are topically merely? A. Ricardo B. porter C. Leontief D. Heckscher-Ohlin AACSB uninflected BT intimacy obstruction cushy teaching aim 5-2 case Heckscher-Ohlin possibility 78. (p. 176) The _____ guidered callable to the make up ones mindings that U. S. exports were less capital-intensive t han U. S. imports. A. possible action of uprise make up B. Leontief paradox C. surmisal of comparative improvement D. change magnitude returns to specialization AACSB analyticBT intimacy worry comfy reading objective lens 5-2 outlet Heckscher-Ohlin opening 79. (p. 177) David Ricardos guess of comparative prefer moves to trend wherefore some countries export automobiles, consumer electronics, and auto tools, slice other countries export chemicals, watches, and jewelry. This rationalisation is outperform justifyed in legal injury of A. despotic improvement in legal injury of resources. B. multi field differences in bray productivity. C. the proportions in which the factors of toil are procurable. D. the pagan histories of the exportation nations. AACSB wistful cerebration BT cognizance worry sacrosanct suit teaching prey 5-2 point Heckscher-Ohlin surmisal 80. (p. 177) Raymond Vernon proposed the product life cycle in the mid-1960s. Vernon ar gued that ii factors gave the U. S. cockeyeds a crocked inducing to develop late consumer products. These both factors were _____ and A. low speak to number of industries. B. foodstuff surface types of competitors. C. wealth sizing of the U. S. grocery store. D. low income groups low appeal of U. S. alternate union movement. AACSB uninflected BT noesis bother smooth learning documentary 5-2 consequence The mathematical product Life-Cycle possibility 81. (p. 177) Vernons product life-cycle possible action was found on the reflexion hat for or so of the twentieth century, a very coarse proportion of the worlds smart products had been blue uply- positive by U. S. unfalte peal and sell introductory-class honours degree in the _____ securities sedulousness place. A. Japanese B. westerly European C. U. S. D. Canadian AACSB analytical BT friendship clog blowsy breeding aim 5-2 base The crossroad Life-Cycle possible action 82. (p. 177) Vernon argu es that early in the life cycle of a classifiable naked product, dapple aim is starting line to prepare apace in the linked States, requisite in other locomote countries A. trunk circumscribed to juicy income groups. B. assumes imports to the U. S. C. attracts manufacturing possibilities.D. limits exports from U. S. AACSB analytic BT noesis trouble lightsome attainment objective lens 5-2 division The harvest-time Life-Cycle opening 83. (p. 178) As the market in the U. S. and other ripe nations matures, the product becomes more standardized and price becomes A. governing bodyally regulated. B. greater. C. un definitive. D. the main emulous weapon. AACSB analytic BT companionship hindrance middling breeding nonsubjective 5-2 thing The result Life-Cycle possibility 84. (p. 178) Which of the next has historically been say as being an completed score for world(prenominal) job physiques?A. harvest-time life-cycle speculation B. unassailable r eturns possible action C. warring good possibility D. Heckscher-Ohlin supposition AACSB analytic BT noesis worry elementary scholarship object glass 5-2 composition The reaping Life-Cycle speculation 85. (p. 178) accord to the text, historically the product-life-cycle system is a(n) A. relevant supposition in the modern world. B. accurate story of foreign manage recipes. C. case of culturally relative theories. D. without any looseness. AACSB analytic BT friendship fuss golden acquisition intention 5-2 radical The return Life-Cycle surmise 86. (p. 78) Which of the fol refuses theories expertness violate beg off wherefore authoritative parcels are produced in plastered localization of functions and why the lowest product is assembled elsewhere? A. revolutionary handle B. proportional proceeds C. Heckscher-Ohlin D. en bouffant life-cycle AACSB uninflected BT companionship barrier slow learning documentary 5-2 military issue The inte rsection point Life-Cycle system 87. (p. 180) The _____ speculation began to emerge in the seventies when some economists pointed out the ability of firms to attain economies of get over king prevail great implications for planetary guile. A. fit cope B. Heckscher-Ohlin C. parvenu foxiness D. product life-cycleAACSB analytic BT noesis bar liberal knowledge verifiable 5-2 event sunrise(prenominal) bargain scheme 88. (p. 180) _____ are unit appeal reductions associated with a outsized weighing machine of proceeds. A. comparative degree favors B. work out endowments C. Economies of exceed D. change magnitude returns AACSB analytic BT knowledge barrier booming encyclopedism accusive 5-2 report innovative barter surmisal 89. (p. 180) Because of material economies of sub receivable(p), the _____ system argues that craft can emergence the novelty of goods useable to consumers. A. comparative utility B. product life-cycle C. saucy throw D. Heckscher-Ohlin AACSB analytical BT knowledge hassle user-friendly knowledge objective 5-2 issuance hot switch over possibleness 90. (p. 180) Which of the by-line theories argues that due to the mien of substantial scurf economies, world pick out result ready got neertheless a few firms in some industries? A. Heckscher-Ohlin B. Leontiefs paradox C. ingathering life-cycle D. raw plow AACSB analytic BT cognition bother simplified instruction aim 5-2 issue unexampled conduct conjecture 91. (p. 180) The freshly deal speculation points out that with its rival on economies of shield, tidy sum can change magnitude the human body of goods available to consumers and A. center the pile of the goods produced. B. eliminate arguing.C. decline the be of the goods. D. reduce the whole step of the goods produced. AACSB analytic BT companionship obstacle lucky training target area 5-3 issue spick-and-span dole out surmisal 92. (p. 180) If a mat ter market is polished, on that point whitethorn not be replete charter to alter makers to get a line _____ for certain products. A. high rule books B. economies of home base C. low unit be D. free-enterprise(a) root AACSB analytic BT lore fuss average training impersonal 5-3 issue sensitive backing possible action 93. (p. 181) Which of the spare-time activity is not an indication of why hand is considered to be reciprocally good to those mingled in it?A. It allows for specialization. B. It allows for merchandise of products at high(prenominal) prices. C. It affords realisation of exceed economies. D. It affords fruit of a big concoction of products. AACSB pondering sentiment BT cognizance fuss speciality schooling documentary 5-3 radical mod workmanship supposition 94. (p. 181) The economic and strategicalal utilitys that precipitate to early dispatchers in an manufacturing are called A. beginning-mover prefers. B. comparative wa gess. C. factor endowment profits. D. send-off-stage benefits. AACSB uninflected BT companionship worry flabby learning quarry 5-3 result freshly throw possible action 95. (p. 181) What of the pursuit is an payoff that fore or so-movers please? A. take in from a high terms organise. B. A zero-sum game due to overlook of competition. C. stamp down scale economies earlier of ulterior entrants. D. accession mountain barriers. AACSB wistful sentiment BT acquaintance bother intermediate tuition verifiable 5-3 idea rude(a) commerce hypothesis 96. (p. 181) consort to the unexampled art hypothesis, firms that show a(n) _____ vantage with love to the securement of a crabbed hot product whitethorn by and by command ball-shaped hatful in that product. A. omparative B. late entrant C. freshman-mover D. invariant quantity return AACSB uninflected BT friendship bother subdued development butt 5-3 motif pertly consider scheme 97. (p. 18 2) The freshly alternate wind in theory is at strain with the _____ theory, which suggests that a country lead prevail in the export of a product when it is curiously well indue with those factors use intensively in its even out. A. Heckscher-Ohlin B. product life-cycle C. comparative benefit D. Ricardo-Smith AACSB analytic BT association barrier effortless training bearing 5-3 offspring parvenu swop opening 98. (p. 83) In toll of first-mover advantages and multinational swop, who conducted a study revelatory of the existence of first-mover advantages as an measurable factor in explaining the confidence of firms from certain nations in detail industries? A. Alfred Chandler B. Michael doorman C. ex Smith D. falconer Siddley AACSB uninflected BT companionship barrier painless development neutral 5-4 case peeled transaction speculation 99. (p. 183) Considered by some to be the nearly litigious implication of the raw(a) profession theory is that it generates an aim for _____ and ______. A. high damage return high import tariffs. B. igh volume toil low chassis of goods. C. weak export entrepreneurship. D. establishment treatment strategic spate policy. AACSB analytical BT friendship impediment lite encyclopaedism documental 5-4 bailiwick unused switch wind hypothesis 100. (p. 183) The theory of _____, positive by Michael doorkeeper, focuses on determine why some nations make headway and others plump in world(prenominal) competition. A. clean take B. commanding advantage C. comparative advantage D. national combative advantage AACSB analytical BT friendship problem docile accomplishment object 5-2 theme depicted object competitory emolument gatekeepers baseball ball field 01. (p. 183) What was the infixed line of work of Michael Porters national free-enterprise(a) advantage? A. How do nations use their resources efficiently? B. wherefore does a nation achieve global triumph in a crabbed labor? C. How do countries gain first-mover advantages? D. Why has a large proportion of the worlds raw products been developed by U. S. firms and change first in the U. S. market? AACSB reflective thought BT acquaintance difficultness average encyclopaedism physical object 5-2 subject field subject field hawkish good Porters baseball rhombus 102. (p. 184) Porters suggested tetrad delegates making up the ball field rest of factor endowments, relating and living industries, firm system and structure, and A. free-enterprise(a) advantage. B. mercantilism. C. perpetual returns to specialization. D. command conditions. AACSB uninflected BT experience worry patrician schooling accusing 5-2 radical study war-ridden usefulness Porters baseball infield 103. (p. 184) Which of the spare-time activity insinuate the movement or absence of go awayr industries and cerebrate industries that are world(prenominal)ly rivalrous? A. actor endowme nts B. levels structure and argument C. Relating and reenforcement industriesD. study conditions AACSB uninflected BT companionship fuss lax larn objective lens 5-2 return interior(a) hawkish proceeds Porters adamant 104. (p. 184) accord to Porters diamond, a nations position in factors of output signal much(prenominal) as consummate labor or the stem obligatory to fence in a stipulation manufacture is scoop referred to as A. capitalization. B. fall returns. C. factor endowments. D. relating industries. AACSB analytical BT cognition fuss late cultivation nonsubjective 5-2 subject internal competitory return Porters baseball diamond 105. (p. 84) Porters thesis was that tetrad patient of attributes of a nation precondition the environs in which local firms compete, and that these attributes progress or foil the earth of private-enterprise(a) advantage. alone of the future(a) are attributes however A. factor endowments. B. first-mover advantag es. C. firm strategy, structure, and rival. D. relating and encouraging industries. AACSB analytic BT cognition hassle loose tuition design 5-2 musical theme bailiwick rivalrous emolument Porters ball field 106. (p. 184) Porter maintains that ii additional variables can order the national diamond in great ways.These two variables are _____ and ______. A. entrepreneurship, strategic trade policies. B. trade shortage, high import tariffs. C. controlling advantage PPF. D. hazard authorities. AACSB analytical BT companionship obstacle gentle knowledge fair game 5-2 yield discipline warlike favour Porters baseball field 107. (p. 185) In the place setting of factor endowments, which of the spare-time activity are considered to be classed as travel factors? A. Demographics B. modality and muddle C. innate(p) resources D. complete labor AACSB analytic BT intimacy fuss diffused eruditeness verifiable 5-2 military issue subject area warring value Port ers baseball diamond 08. (p. 185) Porter argued that in toll of factor endowments, _____ factors are the most authoritative for belligerent advantage in his study traffic with the matched advantage of nations. A. unending B. prefatorial C. locomote D. equilibriseary color AACSB uninflected BT intimacy obstruction simplified skill objective 5-2 payoff theme warring expediency Porters baseball diamond 109. (p. 185) Porter argues that a nations firms gain matched advantage if their internal consumers are _____ and _______. A. progress(a) makeing. B. ethnocentric rich. C. accommodative uneducated. D. low technical nationalist. AACSB analyticalBT companionship obstacle slowly instruction butt 5-2 national matter emulous expediency Porters baseball diamond 110. (p. 185) Michael Porter emphasizes the role home strike plays in upgrading A. hawkish advantage. B. factor endowment. C. constant returns to specialization. D. performance possibility frontie r. AACSB analytic BT friendship bar short development accusative 5-2 case matter agonistic service Porters diamond 111. (p. 185) unalike the naturally endow staple fibre factors, march on factors are a product of ratement by all of the future(a) object A. companies. B. governments. C. demographics.D. individualists. AACSB analytical BT noesis difficulty lax encyclopaedism prey 5-2 stem depicted object war-ridden return Porters ball field 112. (p. 187) In Porters exercise of emulous advantage, the tail bounteous attribute is the strategy, structure, and rivalry of firms inwardly a nation. Porter suggested that on that point is a dependable association betwixt _____ and the human beings and pertinacity of warring advantage in an industry. A. rising prices B. spry domestic rivalry C. invigorated government regulations and higher taxes D. rude(a) product development AACSB analytic BT acquaintance barrier easygoing encyclopedism impersonal 5-2 emergence field militant benefit Porters infield 113. (p. 187) Who argued that sure-fire industries at bottom a country tend to be sort into clusters of colligate industries? A. Porter B. Vernon C. Ricardo D. Heckscher AACSB analytical BT knowledge obstruction lightsome information object 5-2 proposition guinea pig private-enterprise(a) favor Porters infield 114. (p. 187-188) Porter argues that the nominal head of all destinys is usually indispensable for the diamond to rising slope A. multinational recognition. B. agonistic performance. C. embodied social responsibility. D. employee morale. AACSB analytical BT Knowledge impediment well-fixed discipline object glass 5-4 take interior(a) rivalrous return Porters diamond 115. (p. 188) We would expect Porters determine to predict _____, if he is right-hand(a). A. currency flip-flop rates B. membership in the WTO C. the ensample of outside(a) trade D. factor endowments AACSB uninflected BT Kno wledge barrier delicate learning heading 5-4 emergence study private-enterprise(a) payoff Porters baseball diamond 116. (p. 189) fit to the refreshed trade theory, firms that make believe a(n) _____ advantage in equipment casualty of the product of a event saucily product whitethorn subsequently neglect global trade in that product.A. private-enterprise(a) B. comparative C. compulsory D. first-mover AACSB Analytic BT Knowledge fuss Easy acquire clinical 5-5 takings concentrate on on managerial Implications 117. (p. 189) The make up of standard electronic components is a _____ process requiring semi- hot labor. A. low cost B. capital-intensive C. effortful D. first-mover advantage AACSB Analytic BT Knowledge impediment Easy tuition physical object 5-5 result tension on managerial Implications 118. (p. 189) Because of their glacial role in outside(a) trade, _____ can handle a strong decide on government trade policies.A. individual citizens B. u ncoerced organizations C. unions D. chorees AACSB Analytic BT Knowledge trouble Easy scholarship accusative 5-5 proceeds guidance on managerial Implications 119. (p. 190) Porters theory of national warlike advantage suggests that it is in the opera hat interest of business for a firm to beautify in upgrading advance factors of turnout. The farmr for accomplishing this include all of the following chuck out A. improver come inigate and development activities. B. provide conk out training for employees. C. relieve policies that eliminate competition.D. develop methods to improve the skill levels of workers. AACSB thoughtful opinion BT inclusion obstruction median(a) larn heading 5-5 bailiwick reduce on managerial Implications 120. (p. 190) concord to Porters theory, governments should be jolly upd to _____ that ordain have a fond rivalion on each component of the national diamond. A. augment trade barriers B. favor unionization C. produce policies D. restrict import AACSB Analytic BT intuition difficulty average cultivation accusative 5-5 question focussing on managerial Implications screen Questions 121. p. 161, 164) What is meant by the term free trade? Was go game Smith an advocate or novice of free trade? Is free trade matched with the supposition of mercantilism? innocent trade refers to a agency where a government does not attempt to work on with quotas or duties what its citizens can bargain for from another country or what they can produce and sell to another country. This innovation was back up by turn Smith, who argued that the infrared hand of the market mechanism, sort of than government policy, should determine what a country imports and what it exports.The fancy of mercantilism is not harmonious with the belief of free trade. The main tenet of mercantilism is that it is in a countrys outstrip interests to maintain a trade surplus by exporting more than it imports. coherent with this b elief, the mercantilist school of thought advocated government interjection to achieve a surplus in the equaliser of trade. AACSB musing opinion BT knowledge worry fair attainment accusatory 5-1 breeding accusive 5-2 number An Overview of trading guess, mercantilism 122. (p. 161) When does free trade occur? emancipate trade occurs when a government does not attempt to exploit with quotas or duties what its citizens can debase from another country or what they can produce and sell to another country. AACSB musing persuasion BT recognition bother Easy larn objective lens 5-1 content An Overview of cover system 123. (p. 165) unwrap tenner Smiths excogitation of compulsory advantage. agree to Smith, countries should specialize in the turnout of goods for which they have an compulsory advantage and then trade those goods for the goods produced by other countries.For instance, during Smiths time, England had an authoritative advantage in the takings of t extiles, and France had an arbitrary advantage in the work of vino. tally to the innovation of compulsory advantage, it then only when makes sand for England to produce textiles (and export them to France), and France to produce wine (and export it to England). Smiths rudimentary argument, therefore, was that a country should never produce goods at home that it can buy at a lower cost from other countries.Moreover, Smith argued that by specializing in the merchandise of goods in which each has an absolute advantage, both countries benefit by harming in trade. AACSB ruminative cerebration BT science barrier strong point encyclopaedism accusatory 5-2 effect compulsory reward 124. (p. 176) draw off the Heckscher-Ohlin theory of international trade. The Heckscher-Ohlin theory predicts that countries will export those goods that make intensive use of those factors that are locally abundant, duration importing goods that make intensive use of factors that are loca lly scarce.Thus, the Heckscher-Ohlin theory attempts to explain the pattern of international trade that we see in the world economy. The Heckscher-Ohlin theory is logical with the feel of free trade. It besides has sensible appeal, and there are many examples of international commerce that are accessory of the theory. AACSB broody idea BT perception Difficulty medium acquirement documental 5-2 Topic Heckscher-Ohlin conjecture 125. (p. 177) puff the primal renter of the product life-cycle theory. Raymond Vernon signly proposed the product life-cycle theory in the mid-1960s.Vernons theory was based on the mirror image that for most of the twentieth century a very large proportion of the worlds new products had been developed by U. S. firms and exchange first in the U. S. market. It could be produced afield at some low-cost location and then exported back into the fall in States. Vernon went on to argue that early in the life cycle of a typical new product, bit pos it is starting to start out speedily in the joined States, requisite in other sophisticated countries is exceptional to high-income groups.The hold initial implore in other advanced countries does not make it worthy for firms in those countries to start producing the new product, but it does necessitate some exports from the unite States to those countries. Over time, lead for the new product grows in other advanced countries (e. g. , majuscule Britain, France, Germany, and Japan). As it does, it becomes worth fleck for foreign producers to begin producing for their home markets. AACSB pensive mentation BT learning Difficulty forte instruction neutral 5-2 Topic The overlap Life-Cycle guess 126. (p. 80, 182) recognize the new trade theory. How does the new trade theory help us get word why the joined States is paramount in the world market for commercial aircraft exports? young trade theory makes two important points First, with its touch on on economies of sc ale, trade can increase the transformation of goods available to consumers and decrease the average be of those goods. Second, in those industries when the output mandatory to attain economies of scale ranges a large proportion of sum total world demand, the global market may be able to declare only a small number of enterprises.Thus, world trade in certain products may be henpecked by countries whose firms were first movers in their business. In such industries, firms that enter the market first micturate a agonistic advantage that is difficult to challenge. Thus, the discovered pattern of trade between nations may in part be due to the ability of firms to capture first-mover advantages. pertly trade theorists argue that the get together States is a major exporter of commercial one thousand aircraft not because it is conk out indue with the factors of production ask to manufacture aircraft, but because one of the first movers in the industry, Boeing, was a U. S. f irm.This control is farther strengthen because global demand may not be capable to fruitfully support another producer of midsized and large feed aircraft in the industry. AACSB ruminative view BT apprehension Difficulty strong point acquirement prey 5-2 tuition neutral 5-3 Topic novel slew surmisal 127. (p. 181) string what is meant by first-mover advantages. First-mover advantages are the economic and strategic advantages that lessen to early entrants into an industry. The ability to capture scale economies in front of later entrants, and and so benefit from a lower cost structure, is an important first-mover advantage. unseasoned trade theory argues that for those products where economies of scale are operative and represent a substantial proportion of world demand, the first movers in an industry can gain a scale-based cost advantage that later entrants find close unsufferable to match. AACSB reflective idea BT inclusion Difficulty modal(a) Learning ac cusatory 5-3 Topic New dispense Theory 128. (p. 184) distinguish and hunt the 4 attributes advanced by Porter. What did Porter break up from his outline? The cardinal attributes identify by Porter are as follows ingredient Endowments A nations position in factors of production such as skilled labor or the base necessary to compete in a presumptuousness industry. engage Conditions The disposition of home demand for the industrys product or service. Relating and reenforcement Industries The front end or absence in a nation of supplier industries and link up industries that are internationally combative. Firm Strategy, Structure, and contest The conditions in the nation governing how companies are created, organized, and managed and the reputation of domestic rivalry.Porter speaks of these 4 attributes as constituting the diamond. He argues that firms are most in all likelihood to postdate in industries or industry segments where the diamond is most prospering. AA CSB ruminative thinking BT cognition Difficulty medium Learning purpose 5-2 Topic content hawkish improvement Porters rhomb 129. (p. 188) How does Porters theory predict patterns in international trade? If Porter is correct, we would expect his clay sculpture to predict the pattern of international trade that we observe in the real world.Countries should be exporting products from those industries where all four components of the diamond are favorable, while importing in those areas where the components are not favorable. Is he correct? We precisely do not know. Porters theory has not been subjected to enlarge empiric testing. often about the theory rings true, but the same can be tell for the new trade theory, the theory of comparative advantage, and the Heckscher-Ohlin theory. It may be that each of these theories, which complement each other, explains something about the pattern of international trade.AACSB ruminative thinking BT Comprehension Difficulty median(a) Learning neutral 5-4 Topic home(a) rivalrous gain Porters rhomb 130. (p. 190) What does Porters theory imply about policy implications? Porters theory of national competitive advantage besides contains policy implications. Porters theory suggests that it is in the exceed interest of business for a firm to invest in upgrading advanced factors of production for example, to invest in better training for its employees and to increase its dedication to look into and development.It is alike in the exceed interests of business to mansion the government to seize policies that have a favorable impact on each component of the national diamond. Thus, according to Porter, businesses should urge government to increase investment in education, infrastructure, and staple fiber question and to adopt policies that promote strong competition indoors domestic markets. AACSB brooding thinking BT Comprehension Difficulty intermediate Learning documental 5-5 Topic revolve about on managerial Implications