Free Trade
Protectionism
Economic Integration
Exchange Rates
Balance of Payments
100
Founded in 1995, this organization replaced GATT.
What is the World Trade Organization?
100
This is the specific effect of a tariff on economic efficiency.
What is the deadweight loss due to reduced competition resulting from the tariff?
100
This is the type of economic integration where countries reduce trade barriers, but maintain their own trade policies with non-member countries.
What is a Free Trade Area?
100
This is the term for an exchange rate system in which the government pegs their currency to a specific value relative to another currency or commodity.
What is a fixed exchange rate system?
100
This is the balance of payments account that records the value of a country's trade in services.
What is the current account?
200
The USA possesses this in relation to Germany.
What is absolute advantage?
200
This is the specific effect of a subsidy on the government budget.
What is an increase in the government budget due to the subsidy payment to domestic producers?
200
This is the type of economic integration where countries remove all barriers to trade between them and adopt a common external trade policy.
What is a Customs Union?
200
This is the term to describe when a currency increases in value.
What is appreciation?
200
This is the balance of payments entry that records a country's payment of funds to foreign sources.
What are current transfers?
300
This is the economic concept that refers to the ability of a country to produce a good at a lower opportunity cost than another country.
What is Comparative Advantage?
300
Box 3 is an example of this.
What is the amount of government revenue collected as a result of a tariff?
300
This is the term for the positive effect of economic integration on trade, where trade between countries increases due to lower trade barriers.
What is Trade Creation?
300
This is the term for an exchange rate system in which the government allows the exchange rate to fluctuate according to market forces.
What is a freely floating exchange rate system?
300
This is the balance of payments account that records a country's payment of funds to foreign sources.
What is current account?
400
This is the term for the positive effect of free trade on the costs of production, leading to lower prices for consumers.
What is global efficiency?
400
This is the specific effect of a quota on consumers' welfare.
What is a reduction in consumers' welfare due to the higher prices of goods caused by the quota?
400
This is the type of economic integration where countries allow for free trade in goods and services and the free movement of capital and labor.
What is a Common Market?
400
This is the term to describe a country's decision to fix their currency at a lower price.
What is devaluation?
400
According to the Marshall-Lerner Condition, this must occur for a currency devaluation to improve a country's trade balance.
What is the sum of the price elasticities of a country's exports and imports must be greater than 1?
500
In this PPC diagram, this is the USA.
Which country has the comparative advantage in software production?
500
This is the word used to describe the type of tax a tariff is because it increases income inequality.
What is a regressive tax?
500
This is the term for the negative effect of economic integration on trade, where trade between countries decreases due to trade being diverted away from more efficient non-member countries.
What is Trade Diversion?
500
This is the term for an exchange rate system in which the government sets a target exchange rate and intervenes in the foreign exchange market to maintain it.
What is a managed float exchange rate system?
500
According to the J-curve theory, this occurs to a country's trade balance in the short run after a currency devaluation.
What is a deterioration of a country's trade balance in the short run, followed by an improvement in the long run?