1) For the month of March 2014, the U.S. purchased $234 billion of foreign-produ
ID: 1207828 • Letter: 1
Question
1) For the month of March 2014, the U.S. purchased $234 billion of foreign-produced goods and services and sold $193 billion of domestically-produced goods and services to foreign countries. For March 2014, the U.S. had ____.
exports of $234 billion and a trade surplus of $41 billion
exports of $234 billion and a trade deficit of $41 billion
exports of $193 billion and a trade surplus of $41 billion
exports of $193 billion and a trade deficit of $41 billion
2)
The U.S. imposes an annual quota of 1,117,195 tons of raw sugar entering the U.S. from other countries. If the current world price is approximately $0.29 per pound of raw sugar, then how much tax revenue does the U.S. Federal government receive because of this quota?
$0
$0.29
Greater than $1 million but less than $10 million
D. Greater than $10 million
3) In March 2014, Canada and South Korea completed a free-trade agreement. In the agreement, South Korea eliminated its 20.5 percent tariff on Canadian live lobsters. Prior to the trade agreement, Canada exported 8,500 kilograms of live lobsters to South Korea per year, with an average selling price per kilogram in South Korea of 42,000 won (the currency used in South Korea). With the elimination of the live-lobster tariff, which of the answer choices gives a correct prediction of the amount of live lobsters exported by Canada to South Korea and the average selling price, respectively?
8,800 kilograms and 44,000 won
9,400 kilograms and 39,500 won
8,200 kilograms and 45,600 won
7,900 kilograms and 41,750 won
4)
Which of the answer choices correctly represents the exchange rate movement of the given currencies as demonstrated by the data in the forex table?
5)
Purchasing power parity (PPP) is a theory in macroeconomics which states that a unit of any given currency should be able to purchase the same quantity of goods in all countries. PPP implies that the movement (i.e., appreciation or depreciation) of Country X’s currency equals the difference between Country Y’s rate of inflation and Country X’s rate of inflation.
During a Monday-to-Monday time period, the rate of inflation in the U.S. was 0.6 percent and the rate of inflation in Sweden was 1.4 percent. Which of the answer choices gives the correct time span depicting the movement of the exchange rate of the U.S. dollar against the Swedish krona?
From March 3 to April 7 only.
From April 7 to May 5 only.
From March 3 to Apirl 5 and from May 5 to June 8.
D) From April 7 to May 5 and from May 5 to June 8.
6) On Monday, June 8, Pilgrim's Pride made a $6.5 billion bid to purchase Hillshire Brands Company, maker of Jimmy Dean sausage and Ball Park hot dogs. Pilgrim's Pride, the largest chicken producer in the U.S., is owned by JBS Holdings, a São Paulo, Brazil food processing company. Which of the answer choices gives the approximate value of the purchase price in Brazilian reals on June 8?
14.75 billion Brazilian reals
13.20 billion Brazilian reals
8.60 billion Brazilian reals
3.25 billion Brazilian reals
7) According to the forex table, which of the answer choices is correct?
On March 3, one Swedish krona exchanged for 6.7981 U.S. dollars.
On April 7, 41.615 U.S. dollars exchanged for one Philippine peso.
On May 5, 4.0404 Israeli shekels exchanged for 4.0404 U.S. dollars.
D. On June 8, one U.S. dollar exchanged for 30.623 Thai baht.
Point (A), where U.S. consumption is 75 pounds of black pepper and 25 bales of cotton.
Point (B), where U.S. consumption is 50 pounds of black pepper and 100 bales of cotton.
Point (C), where U.S. consumption is 100 pounds of black pepper and 150 bales of cotton.
Point (D), where U.S. consumption is 125 pounds of black pepper and 225 bales of cotton.
9)
Suppose that prior to TIFA implementation the U.S. and Vietnam used their resources to produce half of the maximum of each good, given by points (1) and (2) on the graphs. At these points, what is the total production of black pepper and cotton?
75 pounds of black pepper and 50 bales of cotton
150 pounds of black pepper and 125 bales of cotton
225 pounds of black pepper and 175 bales of cotton
300 pounds of black pepper and 250 bales of cotton
10)
The U.S. has a comparative advantage in the production of black pepper, and Vietnam has a comparative advantage in the production of cotton.
The U.S. has a comparative advantage in the production of cotton, and Vietnam has a comparative advantage in the production of black pepper.
The U.S. has a comparative advantage in the production of both black pepper and cotton.
Vietnam has a comparative advantage in the production of both black pepper and cotton.
11)
Suppose that after TIFA implementation the U.S. and Vietnam specialize in the good in which each has a comparative advantage. Because of this specialization, what is now the total production of black pepper and cotton?
300 pounds of black pepper and 250 bales of cotton
300 pounds of black pepper and 350 bales of cotton
450 pounds of black pepper and 250 bales of cotton
450 pounds of black pepper and 350 bales of cotton
12) Suppose that prior to TIFA implementation the U.S. and Vietnam used their resources to produce half of the maximum of each good, given by points (1) and (2) on the graphs. At these points, what is the total production of black pepper and cotton?
75 pounds of black pepper and 50 bales of cotton
150 pounds of black pepper and 125 bales of cotton
225 pounds of black pepper and 175 bales of cotton
300 pounds of black pepper and 250 bales of cotton
A.exports of $234 billion and a trade surplus of $41 billion
B.exports of $234 billion and a trade deficit of $41 billion
C.exports of $193 billion and a trade surplus of $41 billion
D.exports of $193 billion and a trade deficit of $41 billion
Explanation / Answer
1.
Export = $193 billon
Import = $234 billion
Trade deficit = Exceeding import over export = $234 - $193 = $41 billion
Answer: D
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