Question 1. "The United States can produce X more efficiently than can Great Britain. Yet we import X from Great Britain." Explain
Question 2. Evaluate the following statements:
a. The extensive application of protective tariffs destroys the ability of the international market system to allocate resources efficiently.
b. In view of the rapidity with which technological advance is dispersed around the world; free trade will inevitably yield structural maladjustments, unemployment, and balance-of-payments problems for industrially advanced nations.
Question 3. Suppose Japan agreed to a voluntary export restriction (VER) that reduced U.S. imports of Japanese steel by 10 percent. What would be the likely short-run effects of that VER on the U.S. and Japanese steel industries? If this restriction were permanent, what would be its long-run effects in the two nations on (a) the allocation of resources, (b) the volume of employment, (c) the price level, and (d) the standard of living?
Question 4. Plan in detail five ways an organization can benefit from international trade.