1. A firm headquartered in South Korea wants to serve the U.S market. Since U.S is under NAFTA, this firm intends to estaldish a paper company in Mexico and let it export to the U.S to get zero tariff. To avoid this situation, FTA has ________ principle.

A. MFA B. Rules of origin C. Safeguard D. Trade Diversion

1. Choose the correct statement about China Safeguard.

A. China-specific safeguard violates Most Favored National principle.

B. China Safeguard was added by the U.S as a condition to China's joining the WTO in 2001 and still in effect.

C. Toal seven China Safeguard cases has been approved by the U.S government.

D. In oder for China Safeguard to be applied, rising imports from China should cause the most material injury to the U.S domestic industry.

1. In the closed economy, the firm with high MC sets higher/ lower/ same price than ( or as) the one with low MC.

1. And, the firm with high MC has larger/ smaller/ same market share than (or as) the one with low MC.

1. Therefore, the firm with high MC has larger/ smaller/ same profit level than (or as) the one with low MC.

1. In open economy, the firm with high MC faces higher / lower / same market size than (or as) that of the closed economy.

1. Therefore, the firm with high MC has larger / smaller/ same profit level than (or as) that of the close economy.

1. The firm with low MC has larger/ smaller / same profit level than (or as) that of the closed economy.