An export subsidy should have the opposite effect of ?

Related Mcqs:

1. Government granted monetary assistance to a person or a group in support of an enterprise regarded as being in public interest. This is called subsidy. Point out the statement which is also a subsidy ?

   A. Financial assistance given by one person or government to another
   B. Financial assistance given to poor people
   C. Financial assistance given to aged people
   D. Financial assistance given to small companies

2. To aid its calculator producers, suppose that the government provides them a subsidy of $10 for each calculator produced The amount of imports now equals _____ and the deadweight loss of the subsidy to the Canadian economy equals _________?

   A. 20 calculator, $50
   B. 20 calculator, $100
   C. 25 calculator, $50
   D. 25 calculator, $100

3. Suppose that the world price of tin is above the target (ceiling) price that is defined by an international commodity agreement. To move the world price toward the target price, a buffer stock agreement would require its buffer stock manager to ____ tin and an export quota agreement would require that member countries _________ their export of tin?

   A. purchase; decrease
   B. purchase; increase
   C. sell; increase
   D. sell; decrease

4. In the Px = export price index, Pm = import price index, Qx = export quantity index,and Qm = import quantity index. Developing countries tend to maintain that their commodity term of trade have declined over the long run suggesting that _________ has declined?

   A. Px/Pm
   B. Pm/Px
   C. (Pm/Px)Qm
   D. (Px/Pm)Qx

5. The booming of North Seas’ gas export revenues in the 1970s that appreciated the guilder, making industrial export more costly in foreign currencies and increasing foreign competition and unemployment is known as ?

   A. Trade deficit
   B. Blind river disease
   C. Dutch disease
   D. Economic turmoil

6. Micheal Roemer’s three-sector model shows that growth in the booming export sector I- reduces the price of foreign exchange II- retards other sectors’ growth by reducing incentives to export other commodities III- reduces incentives to replace domestic goods for imports IV- raises factor and input prices for non-booming sectors ?

   A. I and III only
   B. II and III only
   C. I, II and III only
   D. I, II , III only IV

7. To help its firms penetrate Mexico’s radio market suppose the Japanese government provides them a subsidy of $15 for each radio shipped to Mexico As a result of this trade policy ?

   A. The price of radios in Mexico equals $60 and its imports equal 30 radios
   B. The price of radios in Mexico equals $30 and its imports equal 30 radios
   C. The price of radios in Mexico equals $40 and its imports equals 20 radios
   D. Th price of radios in Mexico equals $20 and its imports equal 40 radios

8. If the home country government grants a subsidy on a domestically produced good domestic producers tend to ?

   A. Capture the entire subsidy in the form of higher profits
   B. Increase their level of production
   C. reduce wages paid to domestic workers
   D. consider the subsidy as a increase in production cost

9. A subsidy paid to producers ?

   A. Shifts the supply curve
   B. shifts the demand curve
   C. Leads to a contractions in supply
   D. Leads to an extension of supply

10. Goals are achieved through ____ such a monetary fiscal, exchange rate tariff tax subsidy, business incentive foreign investment and foreign aid?

    A. indicative plan
    B. central bank policies
    C. central planning
    D. instrument variables