Arizona State University ECN 306 1)The United States_provide government aid to American aircraft exporters

Arizona State University

ECN 306

1)The United States_provide government aid to American aircraft exporters. The European Union                     provide government aid to European aircraft exporters.

•             does; does not

•             does not; does

•             does; does

•             does not; does not

2. The combination of an export subsidy imposed by Japan and an equal countervailing import duty imposed by Australia will result in losses for:

•             Australia but not for Japan and the world as a whole.

•             Japan but not for Australia and the world as a whole.

•             the world as a whole but not for Australia or Japan.

•             Australia and Japan but not for the world as a whole.

3. Which of the following does the World Trade Organization allow countries to impose?

•             New higher tariffs

•             New import quotas

•             New antidumping tariffs

•             New export subsidies

4. The United States does not place a tax on exports from the United States because:

•             Congress has never been able to agree on what exports should be taxed and what tax rate should be applied.

•             taxing exports would reduce the benefit gained from the exports by a greater amount than

the benefit that would be gained from the tax.

•             the U.S. Constitution prohibits the taxing of exports.

•             such taxes are not allowed by the WTO.

5. For persistent dumping to be successful, firms will maximize profits by:

•             charging a higher price in the more inelastic market.

•             charging a higher price in the larger market.

•             charging the same price in all markets.

•             only selling in the more inelastic market.

6. The success of Asian apparel exports to the United States and Europe probably is based on:

•             a great productivity failure in the United States and the European Union.

•             the fact that apparel uses capital intensively and the United States is not relatively abundant in capital.

•             the fact that apparel uses unskilled labor intensively and Asia is relatively abundant in that

factor.

•             the fact that Asian countries provide export subsidies to the apparel manufacturers in their countries.

7. If a country believes that dumping is occurring and that domestic firms are being hurt by that dumping, the country can complain to the WTO or the country can:

•             prohibit all imports from the country that is responsible for the dumping.

•             impose a tariff equal to the difference between the export price of the product being dumped and the normal value of that product.

•             sue the exporting company that is accused of dumping for all damages that are incurred.

•             seize all of the product that is being dumped and hold that product until the matter is resolved.

8. Financial assistance that governments provide to benefit firms that sell to foreign buyers is:

•             trade adjustment assistance.

•             export insurance.

•             foreign sales leads.

•             export subsidies.

9. Substantial export subsidies can switch a(n)   product into a(n)

                product.

•             importable; exportable

•             exportable; importable

•             exportable; domestic

•             nontraded; importable