Practice International Economics Questions and Answers

• A current-account deficit financed by a capital-account surplus illustrates that:
• The terms of trade of a country improve when:
• The WTO principle of most-favoured-nation treatment broadly requires members to:
• If the opportunity cost of producing one unit of X is lower in country A than country B, country A has comparative advantage in:
• A production subsidy to an export industry in a small country tends to:
• The Stolper-Samuelson theorem links an increase in the relative price of a good to an increase in the real return of the factor used:
• The Rybczynski theorem states that, at constant goods prices, an increase in one factor endowment tends to:
• An appreciation of the domestic currency, other things equal, tends to make imports:
• A J-curve effect refers to the possibility that after depreciation the trade balance:
• Under a currency board, domestic money issuance is closely tied to:
• The balance-of-payments identity implies that, with errors and omissions ignored, the current account plus the financial/capital account and reserve change...
• A quota differs from a tariff because a quota directly restricts:
• An improvement in a country's terms of trade means that, for a given volume of exports, the country can obtain: