《国际经济学》模拟试题一
I. Multiple-choice questions (20%)
1. The trade model of the Swedish economists Heckscher and Ohlin maintains that:
a. Absolute advantage determines the distribution of the gains from trade
b. A country exports goods for which its resource endowments are most suited
c. The division of labor is limited by the size of the world market
d. Comparative advantage determines the distribution of the gains from trade
2. As a result of international trade, specialization in production tends to be:
a. Complete with constant costs—complete with increasing costs
b. Complete with constant costs—incomplete with increasing costs
c. Incomplete with constant costs—complete with increasing costs
d. Incomplete with constant costs—incomplete with increasing costs
3. In general, as we move downward along a country’s community indifference curve, the
marginal rate of substitution of one product for another product:
a. Increases
b. Decreases
c. Remains constant
d. None of the above
4. Which trade theory contends that a country that initially develops and exports a new
product may eventually become an importer of it and may no longer manufacture the
product?
a. Theory of factor endowments
b. Theory of overlapping demands
c. Product life cycle theory
d. Economies of scale theory
5. Refer to Figure 1. Given offer curves Korea0 and Germany0, at terms of trade tt1, there
is a (an):
a. Excess demand for tools which causes Germany’s terms of trade to worsen
b. Excess demand for tools which causes Germany’s terms of trade to improve
c. Excess supply of tools which causes Germany’s terms of trade to improve
d. Excess supply of tools which causes Germany’s terms of trade to worsen
Figure 1 Offer Curves of Korea and Germany
6. According to the specific factors trade theory:
a. Owners of factors specific to export industries suffer from trade, while
factors specific to import-competing industries gain
b. Owners of factors specific to export industries gain from trade, while
factors specific to import-competing industries suffer
c. Both owners of factors specific to export industries and owners of factors
import-competing industries gain from trade
d. Both owners of factors specific to export industries and owners of factors
import-competing industries suffer from trade
owners of
owners of
specific to
specific to
7. Which of the following policies permits a specified quantity of goods to be imported at
one tariff rate and applies a higher tariff rate to imports above this quantity?
a. Tariff quota
b. Import tariff
c. Specific tariff
d. Ad valorem tariff
8. The redistribution effect of an import tariff is the transfer of income from the domestic:
a. Producers to domestic buyers of the good
b. Buyers to domestic producers of the good
c. Buyers to the domestic government
d. Government to the domestic buyers
9. A producer successfully practicing international dumping would charge:
a. A relatively higher price in the more inelastic market
b.
c.
d.
A relatively higher price in the more elastic market
The same price in all markets, regardless of their elasticities
Different prices in all markets, regardless of their elasticities
10. When the formation of a free trade area results in the reduction of trade with
nonmember nations in favor of member countries, __________ occurs.
a. Trade devaluation
b. Trade revaluation
c. Trade creation
d. Trade diversion
11. All of the following are credit items in the balance of payments, except:
a. Investment inflows
b. Merchandise exports
c. Payments for American services to foreigners
d. Private gifts to foreign residents
12. A country that is a net international debtor initially experiences:
a. An augmented savings pool available to finance domestic spending
b. A higher interest rate, which leads to lower domestic investment
c. A loss of funds to trading partners overseas
d. A decrease in its services exports to other countries
13. A U.S. export company scheduled to receive 1 million pounds six months from today
can hedge its foreign exchange risk by:
a. Buying today 1 million pounds in the forward market for delivery in six months
b. Buying 1 million pounds in the spot market for delivery in six months
c. Selling 1 million pounds in the spot market for delivery in six months
d. Selling today 1 million pounds in the forward market for delivery in six months
14. Given a system of floating exchange rates, rising income in the United States would
trigger:
a. An increase in the demand for imports and an increase in the demand for foreign
currency
b. An increase in the demand for imports and a decrease in the demand for foreign
currency
c. A decrease in the demand for imports and an increase in the demand for foreign
currency
d. A decrease in the demand for imports and a decrease in the demand for foreign
currency
15. In the presence of purchasing-power parity, if one dollar exchanges for 2 British
pounds and if a VCR costs $400 in the United States, then in Great Britain the VCR
should cost:
a. 200 pounds
b. 400 pounds
c. 600 pounds
d. 800 pounds
16. Which chain of events would promote payments equilibrium for a surplus nation,
according to the price-adjustment mechanism?
a. Increasing money supply—increasing domestic prices—rising imports—falling
exports
b. Increasing money supply—falling domestic prices—rising imports—falling exports
c. Decreasing money supply—increasing domestic prices—falling imports—rising
exports
d. Decreasing money supply—decreasing domestic prices—falling imports—rising
exports
17. According to the absorption approach (B = Y – A), currency devaluation improves a
nation’s trade balance if:
a. Y increases and A increases
b. Y decreases and A decreases
c. Y increases and/or A decreases
d. Y decreases and/or A increases
18. According to the quantity theory of money, a change in the domestic money supply
will bring about:
a. Inverse and proportionate changes in the price level
b. Inverse and less-than-proportionate changes in the price level
c. Direct and less-than-proportionate changes in the price level
d. Direct and proportionate changes in the price level
19. An exchange rate is said to __________ when its short-run response to a change in
market fundamentals is greater than its long-run response.
a. Undershoot
b. Overshoot
c. Depreciate
d. Appreciate
20. The __________ effect suggests that following a currency depreciation a country’s
trade balance worsens for a period before it improves.
a. Marshall-Lerner
b. J-curve
c. Absorption
d. Pass-through
II. True-false questions (10%)
( ) 1. The mercantilists would have objected to export promotion policies initiated by
the government.
( ) 2. The expression “importance of being unimportant” suggests that if one nation is
much larger than the other, the larger nation realizes most of the gains from trade
while the smaller nation realizes fewer gains from trade.
( ) 3. Linder’s theory of overlapping demand provides an explanation of Product life
cycle theory.
( ) 4. A global import quota permits a specified number of goods to be imported each
year, but does not specify where the product is shipped from and who is permitted
to import.
( ) 5. As the dollar’s exchange value appreciates against the pound, U.S. residents tend
to import more British goods and thus demand more pounds.
( ) 6. If the current account of the balance of payments registers a deficit, the capital
account registers a surplus, and vice versa.
( ) 7. Over the long run, the formation of a customs union may yield welfare gains due
to economies of scale, greater competition, and stimulus to investment.
( ) 8. The Keynesian income-adjustment mechanism contends that a trade-surplus
nation tends to realize falling income and falling imports, thus accentuating the
trade surplus.
(
(
) 9. According to the monetary approach, balance-of-payments disequilibriums are the
result of imbalances in a country’s money supply and money demand.
) 10. Expenditure-switching policies modify the direction of demand, shifting it
between domestic output and imports.
III. Calculation problems (16%)
1. Suppose that under free trade a final good F has a price of $1000, that the prices of the
only two inputs to good F, goods A and B, are PA=$300, PB=$500, and that 1 unit each of
A and B is used in producing 1 unit of good F. Suppose also that an ad valorem tariff of
20 percent is placed on good F, while imported goods A and B face ad valorem tariffs of
20 percent and 10 percent respectively, calculate the effective rate of protection for the
domestic industry producing good F. (8%)
2. Given the following Keynesian model of Canada :( 8%)
Export Function
Investment Function
Saving Function
Import Function
X
I
S
M
=
=
=
=
3000
1000
–1000 + 0.2Y
500 + 0.25Y
(1) Determine the equilibrium level of income. (5%)
(2) Calculate Canada’s foreign trade multiplier. (3%)
IV. Table and figure analysis (22%)
1. The following figure is about effects of import tariff on steel imposed by the United
States. Read it and answer questions. (12%)
Figure 2 Effect of Import Tariff
S
US+w
shows the total supply line under free trade.
(1) Which do you think is the United States in steel market, a large nation or a small
nation? Why?
(2) What is the price faced by domestic consumers?
(3) What is the quantity of: domestic demand, domestic supply, import volume under free
trade?
S
US+w+t
is the total supply line after imposing tariff (100$ per unit).
(4) What is the world price now?
(5) What is the quantity of: domestic demand, domestic supply, import volume after
imposing tariff?
(6) Calculate the amount of protective effect, consumption effect and terms-of-trade
effect.
(7) Does U.S. benefit from imposing tariff? Why or Why not?
2. Using the data of Table 1, answer the following questions. (10%)
(1)Refer to Table 2.in terms of dollar, was the Swiss franc at a 90-day forward discount
or a forward premium? By what percent?
(2)How can a U.S. exporter who has to receive 20,000 Francs in 3 months later hedge his
foreign-exchange risk?
(3)What occurs if the U.S. exporter does not hedge and the spot rate of the franc in 3
months later is .$6570?
Table 1.
Forward Exchange Rates
U.S. Dollar Equivalent
Wednesday
Switzerland (Franc)
30-day Forward
90-day Forward
180-day Forward
.6598
.6592
.6585
.6577
V. Answer Questions (16%)
1 State the four types of regional trading arrangements and point out their main
differences.
2. What is meant by Marshall-Lerner condition?
Ⅵ. Case Discussion: read the following news analysis and answer the following
questions. (16%)
Trade surplus plunges, easing pressure on Yuan
(China Daily) 2010-05-11
China's trade surplus nosedived（暴跌） 87 percent from a year earlier to $1.68 billion in
April, a drop analysts said will ease the pressure on revaluation of the Yuan.
Exports surged 31 percent to $119.9 billion while imports soared 50 percent to $118.2
billion. Total trade volume grew 39 percent to $238.2 billion.
March saw a trade deficit of $7.24 billion, the first monthly deficit in the past six years.
The trade surplus will continue to narrow in the months ahead due to weak overseas
demand, analysts predicted.
"We are highly likely to see trade deficits for May and June because domestic demand
will stimulate import growth while global uncertainties, such as the Europe debt crisis,
will weaken overseas demand," said Liu Wei, president of the School of Economics at
Peking University.
The trend is "good for the stability of China's foreign exchange policy in the short term
and will alleviate the pressure to appreciate the Yuan", he added.
The Ministry of Commerce said recently that the foreign trade picture will not be very
rosy （ 乐 观 的 ） this year because of rising raw material costs, mounting trade
protectionism and a grim outlook for global markets.
Yan Jinny, economist at Standard Chartered Shanghai, said the sovereign-debt crisis in
Europe, where one-fifth of Chinese exports go, helped ease the pressure on the Yuan.
"If not for the Greek fallout, China would have been under bigger pressure," Yan said.
But the pressure will mount after Chinese exports turn robust later this year, analysts said.
Exports will see a rebound but import growth will sag（下跌） when demand for
commodities and infrastructure materials decreases in the third quarter, Yan said.
But the Greek debt crisis is not likely to spread to the whole continent and EU demand
for Chinese goods will perk up in the second half. That will be the time for China to
appreciate its currency, which the United States and some other countries believe is
undervalued.
Chinese leaders have repeatedly asserted that the nation will not bow to foreign pressure.
Chinese exporters are now focusing more on the domestic market to avoid being hit by
the appreciation.
"If the Yuan rises 3 percent, we would reap no profit," said Zheng Rixiao, general
manager of Yawin Mechanical and Electrical Equipment Import and Export, an exporter
based in Fujian province. However, currency appreciation "is a matter of time, so we
have shifted focus to creating high value-added products", he said.
(1) According to the figure, describe some of the characteristics of our nation’s foreign trade recently.
(2) What do you think some reasons of the nosedived trade surplus of China in this April?
(3) What will we do if we can’t take advantage of trade surplus plunge to ease the
revaluation pressure on Yuan for a long time?
参考答案
I. Multiple Choices
1.b
2.b
3.b
4.c
5.d
6.b
7.a
8.b
9.a
10.d
11.d
12.a
13.d
14.a
15.d
16.a
17.c
18.d
19.b
20.b
II. True-false questions
1.F
2.F
3.F
4.T
5.T
6.T
7.T
8.F
9.T
10.T
III.
1. VA=PF-PA-PB=1000-300-500=200(2 points)
VA’=1000×(1+20%)-300×(1+20%)-500×(1+10%)=290(2 points)
e= VA'VA  290  200  0.45 (4 points)
VA
200
2. (1) $10,000 billion (5 points)
(2) 2.22 (3 points)
IV.Table & Figure Analysis
1.
(1) Large nation (1 point)
(2) $475 (1 point)
(3) 50, 10, 40(2 points)
(4) 450 (2 points)
(5) 40, 20, 20 (2 point)
(7) 375, 375, 500 (2 points)
(8) doesn’t benefit(2 points)
2．
(1) 0.8 percent discount per annum against the dollar (3 points)
(2) The U.S. exporter can cover his foreign exchange risk by selling 20,000 francs
for three-month delivery at today's three-month forward rate of $.6585 per franc.
The exporter is willing to receive 13 cents less per franc than today's spot rate
(26 dollar for the 20,000 francs) to guard against the possibility that the spot rate
in three months will be less than $.6598 per franc. In three months, when his
payments are due, the importer will receive 20,000 francs and sell 20,000 francs
to get $13170, irrespective of what the francs's spot rate is at that time. (4 points)
(3) If the spot rate of the franc in three months is $.6570 per franc, and the U.S.
exporter does not obtain forward cover, he must receive $13140 for the 20,000
francs; this amount exceeds by $4 the cost of the francs he incurs by hedging. (3
points)
V. Answer Questions
1. Free trade area refers to an association of trading nations whose members agree to
remove all tariff and nontariff barriers among themselves, but each member
maintains its own set of trade restrictions against nonmembers. (2 points)
refers to an agreement among two or more trading partners to
remove all tariff and nontariff trade barriers among themselves, and each
member nation imposes identical trade restrictions against nonmembers. (2
points)
refers to a group of trading nations that permits: (1) the free
movement of goods and services among member nations, (2) common external
trade restrictions against nonmembers, (3) the free movement of production
factors across national borders within the economic bloc. (2 points)
refers to a union in which national, social, taxation,
and fiscal policies are harmonized and administered by a supranational
institution. (2 points)
2. Devaluation will improve the trade balance if domestic demand elasticity for
imports plus foreign demand elasticity for exports is greater than 1(3 points)
Devaluation will worsen the trade balance if the sum of the two elastic ties is less
than 1. (3 points)
If the sum is equal to 1, devaluation will have no effect. (2 points)
Ⅵ. Case Discussion
(1) China's Exports surged 31 percent to $119.9 billion while imports soared 50
percent to $118.2 billion (1 point). Total trade volume grew 39 percent to $238.2
billion. (1 point) Trade surplus nosedived 87 percent from a year earlier to $1.68
billion in April (1 point). March saw a trade deficit of $7.24 billion, the first
monthly deficit in the past six years (1 point).
(2) Domestic demand stimulates import growth (2 point), global uncertainties, such
as the sovereign-debt crisis in Europe, weaken overseas demand (2 point).
(3) Chinese government should not bow to foreign pressure (2 point). Chinese
exporters should focus more on the domestic market to avoid being hit by the
appreciation (1 point), focus to creating high value-added products (1 point).