Question

QUESTION 6

1. The first example of comparative advantage appeared in a book that was published in 1817. This example showed that mutually beneficial trade between two countries (England and Portugal) was possible. The example assumed that two goods (wine and cloth) could be produced by both countries. Which of the following describes the conclusion of this example?

   		Portugal had a comparative advantage in both wine and cloth, but its advantage in cloth was greater.
   		Portugal had a comparative advantage in wine and England had a comparative advantage in cloth.
   		England had a comparative advantage in both wine and cloth, but its advantage in cloth was greater.
   		England had an absolute advantage in both wine and cloth, but a comparative advantage in wine.

2 points   

QUESTION 7

1. The ________ a corporation keeps to finance future expansion are known as retained earnings.

   		profits
   		bonds
   		dividends
   		stock

2 points   

QUESTION 8

1. If the final expressions in a present value equation used to calculate the price of a bond you are considering buying are "[$50 / (1 + .08) ³] + [$500 / (1 + .08) ³]", which of the following is correct?

   		The face value is $500, the coupon is $50, and the coupon will mature in 3 years.
   		The face value is $50, the interest rate you need is 8 percent, and the coupon will mature in 3 years.
   		The face value is $500, the interest rate you need is 3 percent, and the coupon will mature in 8 years.
   		The coupon is $50, the interest rate you need is 1.08 percent, and the coupon will mature in 3 years.

2 points   

QUESTION 9

1. When Tesla, a U.S. company, purchases Italian-made Pirelli tires for its automobiles, the purchase is

   		neither an export nor an import for either country.
   		both a U.S. and an Italian import.
   		a U.S. import and an Italian export.
   		a U.S. export and an Italian import.

2 points   

QUESTION 10

1. A tax imposed by a government on imports of a good into a country is called

   		an import fine.
   		an import levy.
   		a tariff.
   		an import quota.

2 points   

QUESTION 11

1. Mutual funds sell shares to investors and use the funds to

   		pay dividends.
   		purchase newly issued shares of a particular company's stock.
   		purchase Treasury bonds.
   		invest in a portfolio of financial assets.

2 points   

QUESTION 12

1. When the coupon rate on newly issued bonds ________ relative to older, outstanding bonds, the market price of the older bond ________.

   		increases; falls in the secondary market
   		decreases; falls in the secondary market
   		decreases; falls in the primary market
   		increases; rises in the secondary market

2 points   

QUESTION 13

1. In the 1980s, Japan agreed to limit the quantity of automobiles it would export to the United States. Why did the Japanese government agree to this trade restriction?

   		The Japanese government wanted to limit sales to the United States in order to make more automobiles available for Japanese consumers.
   		The Japanese government feared that the alternative would be a tariff or quota on imports of Japanese automobiles imposed by the U.S. government.
   		The Japanese government wanted more automobiles to be available for export to countries other than the United States.
   		Japanese automobile producers lobbied for the restrictions in order to increase the price of their exports to the United States.

2 points   

QUESTION 14

1. The Trans-Pacific Partnership (TPP) is an agreement between the United States and ________ that was meant to reduce trade barriers.

   		China
   		South America
   		eleven other countries
   		the European Union

2 points   

QUESTION 15

1. The longer you have to wait to receive a payment,

   		the less value it will have to you.
   		the more you are willing to discount the payment.
   		the greater value it will have to you.
   		the lower the interest rate you will charge on the payment.

Answer 1

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Kindly ask rest of the questions in a separate post

6.

Correct option: (b) Portugal had a comparative advantage in wine and England had comparative advantage in production of cloth

Reason: A mutually beneficial trade occurs when one country has comparative advantage in one good and other country has comparative advantage in other good. The countries would then produce and specialize in and export those goods in which they have comparative advantage and thus trade with each other for a mutually beneficial trade.