DIŞ TİCARET - Deneme Sınavı - 7

Today, the countries trying to give foreign trade surplus for social and political purposes are called Neomercantilist.

Laissez-faire means “leave it alone.” Usually it describes the economic policy of a government that stresses non-interference in business.

Natural Advantage; A country’s advantage to other countries due to its climate, natural resources and labor ability. Ex.; Brazil-Coffee, Saudi Arabia-Petroleum, Turkey-Hazelnut

Acquired Advantage; A country’s advantage in terms of products.

Labor productivity: The quantity of a good that can be produced per unit of labor input. It is the reciprocal of the unit labour requirement.

Autarky: The situation in which a country does not trade with the rest of the world.

Opportunity costs represent the benefits an individual, investor or business misses out on when choosing one alternative over another.

Production Possibility Frontier-PPF is a curve that shows the alternative combinations of the two commodities that an economy can produce by fully utilizing all of its resources.

An offer curve is a way to show a nation’s offer to export and import.

The five basic reasons why trade may take place are summarized below:

The correct answer is E.

Mercantilism can be said to be the first theory of international trade. Traders attached great importance to the development of the trade fleet. While one side of trade is profitable, the other party suffers equally. However, the main objective of foreign trade policy is to increase the gold stock, not the import of products. They prohibited the import of products. The correct answer is C.

In economic theory, zero-sum game represents the situation in which one part gains in the expense of the other part. The correct answer is A.

The ability to produce more of a given product using a given amount of resources is called absolute advantage. It refers to the ability of a particular person or a country to produce a particular good with less resources than another person or country. The correct answer is B.

The views of classical economists on Adam Smith and David Ricardo are known as the labour theory of value. According to this approach, the cost of a good (the price of that good in the absence of demand conditions) is measured by the amount of labour spent for its production. On the other hand, labour is accepted as a homogeneous production factor. The cost of the goods which have relatively more labour in production is higher. The correct answer is D.

A country has an absolute advantage in the production of a good relative to another country if it can produce the good at a lower cost or with a higher productivity. A country should produce and export products in which it has an absolute advantage, and a country should import products in which it has a disadvantage. Absolute advantage occurs in two ways:natural and acquired. However, if the input prices are the same in both countries, the country with an absolute advantage will have lower, not higher, unit production cost for that good. The correct answer is C.

A country has a comparative advantage when it can produce a good at a lower opportunity cost than another country; alternatively, when the relative productivity between goods is the highest compared with another country. The theory of comparative advantage states that countries should specialise in producing goods where they have a lower opportunity cost. Even if one country has an absolute advantage in producing all goods, different countries could still have different comparative advantages. The correct answer is A.

Labour productivity is assumed to be fixed when in actuality it changes over time, perhaps based on past production levels. Full employment is assumed when clearly workers cannot immediately and costlessly move to other industries. Also, all workers are assumed to be identical. This means that when a worker is moved from one industry to another, he or she becomes immediately as productive as every other worker who was previously employed there. Finally, the model assumes that technology differences are the only differences that exist between the countries. However, the Ricardian model assumes each market is assumed to be perfectly competitive when in reality there are many industries in which firms have market power. The correct answer is D.

The modern version of the comparative advantage (developed by the Swedish economists Eli Heckscher and Bertil Ohlin at the beginning of the twentieth century) attributes these differences in productivity to the differences in the factor endowments of nations. A country will have a comparative advantage in the production of a good that uses the abundant factor. Suppose that France has a relative abundance of capital and Bangladesh has a relative abundance of labour. Automobiles are capital-intensive to produce, while the textile is labour intensive. At that time France will have a comparative advantage in automobiles construction and Bangladesh will have a comparative advantage in textile sector. If there is an international factor mobility, this may change the relative abundance of nations. The correct answer is B.

The figure shows:

However, nation Z must give up more of Y (not X) for each additional X (not Y) it produces. The correct answer is E.

Classical Trade Theory which is constructed upon both the Theory of Absolute Advantage and the Theory of Comparative Advantage postulates that the basis of the comparative advantage is the labor theory of value. The correct answer is " A " .