Assessment Questions 1 International trade arises from absolute advantage b. comparative advantage importation duties and tariffs d export licenses C 2. When Vanessa, a U.S. citizen, purchases a designer dress from Barneys of New York that was made in Milan, Italy, the purchase is: a. both a U.S. and an Italian import. b. a U.S. Import and an Italian export. c a U.S. export and an Italian import, d. neither an export nor an import for either country Which of the following is a normative statement? a. The main reason why the United States has a trade deficit with China is because China's trade practices are unfair. b. The United States has a comparative advantage compared to the European Union in the production of wheat. c. Both these statements are normative. d. Neither of these statements is normative 4. Comparative advantage implies that a country will a. export goods produced by domestic Industries with low wages relative to its trading partners. b. export those goods in which the country has a comparative advantage. C. find it difficult to conclude free trade agreements with other nations. d. import those goods in which the country has a comparative advantage. 5. If Canada imports fishing poles from Mexico and Mexico imports bacon from Canada, which of the following would explain this pattern of trade? a. Mexico has a lower opportunity cost of producing bacon than Mexico and Mexico has a comparative advantage in producing fishing poles. b. Mexico must have an absolute advantage in producing fishing poles and Canada must have an absolute advantage in bacon. c. Canada has a higher opportunity cost of producing fishing poles than Mexico, and Mexico has a higher opportunity cost of producing bacon than Canada. di Mexico has a higher opportunity cost of producing fishing poles than Canada, and Canada has a higher opportunity cost of producing bacon than Mexico. 6. Which of the following statements is true? a. Although some individuals are made better off as a result of international trade, both countries may be worse off overall b. All individuals in both countries are made better off as a result of international trade. c. Within each country, some individuals are made better off as a result of international trade, but one of the countries will be worse off overall. d. Each country as a whole is made better off as a result of international trade, but individuals within each country may be worse off