11.

Increasing opportunity costs result in a production possibilities frontier that is ____________ to the origin.

A. Convex.

B. Concave.

C. Linear.

D. Horizontal.

12.

Another name for the opportunity costs of a commodity is:

A. Marginal Rate of Transformation ( MRT ).

B. Marginal Rate of Substitution (MRS).

C. Marginal Cost of Commodity (MCC).

D. Marginal Rate of Return (MRR )

13.

Nations will have different production possibilities frontiers because of which characteristic?

A. Differences in consumer preferences.

B. Differences in degree of unemployment.

C. Differences in factor endowments.

D. Differences in commodity indifference curves.

14.

Community indifference curves are ___________________ sloped and _______________________ to the origin.

A. Positively, concave.

B. Negatively, convex.

C. Positively, convex.

D. Negatively, concave.

15.

Equilibrium occurs where a nation's community indifference curve is ______________________ to its production possibilities frontier.

A. Parallel.

B. Perpendicular.

C. Tangent.

D. Equal.

16.

A nation with no trade partners, existing in isolation, is said to be in a state of:

A. Autarky.

B. Equilibrium.

C. Disequilibrium.

D. Absolute advantage.

17.

Which of the following is considered to be a short-run version of the factor price equalization theory.

A. Economies of scale theory.

B. Intra-industry trade theory.

C. Specific factors theory.

18.

The product cycle model was introduced by:

A. Wassily Leontief.

B. Alfred Marshall.

C. Eli Hecsksher.

D. Raymond Vernon.

19.

A tax of 5% per unit of imported wine would be an example of a(an):

A. Compound tariff.

B. Specific tariff.

C. Export tariff.

D. Ad valorem tariff.

20.

Suppose, to produce $200,000 worth of finished cloth in the US, textile producers import $150,000 of raw materials. The raw materials are imported duty free. However, the US has imposed a5% nominal tariff on imports of finished cloth. What is the effective rat of tariff protection enjoyed by the domestic cloth producers in the US?

A. 20%.

B. 10%.

C. 5%.

D. 6%.