Macroeconomics Australia Study Set 1

Goods and services that Australia buys from other nations are called

-The figure above shows the Australian demand and supply curves for cherries. In the absence of international trade, cherry farmers would receive ________ per kilogram of cherries.

If a nation imports a good that can be domestically produced, what happens to the quantity consumed of the good and why?

As a result of importing a good, domestic consumers ________ the quantity consumed and the price of the good ________.

If the world price of a good is below the no-trade domestic price, a country

-The figure above shows the Australian demand and supply curves for cherries. In the absence of international trade, how many kilograms of cherries would Australian farmers produce?

-The above figure shows the Australian market for thongs. When there is no international trade, the Australian price is ________ per thong and the Australian quantity is ________ thongs.

A country exports a good if

If you buy a DVD player produced in Japan, a

Comparative advantage is based on

If Australia imports medicines, then the quantity of medicines produced in Australia will ________ and the quantity of medicines purchased by consumers in Australia will ________.

How can a domestic producer determine whether or not it has a comparative advantage in the production of a good or service?

Australia imports motor vehicles because

When a country exports a good because the world price is higher than the no-trade domestic price, domestic purchases of the good ________ and domestic production of the good ________.

-The figure above shows the Australian demand and supply curves for cherries. Suppose the world price of cherries is $2 per kilogram. At this price, Australian consumption of cherries will equal

With no international trade, the Australian price of wheat is lower than the world price of wheat. This indicates that Australia ________ a comparative advantage in the production of wheat and with international trade, Australia will ________ wheat.

If a nation can produce a good or service at the lowest opportunity cost, then it

-The above figure shows the Australian market for thongs. With international trade, the equilibrium price in Australia is ________ and Australia ________ thongs.

The fundamental force that generates international trade is

-The above figure shows the Australian market for thongs. With international trade, Australia imports ________ thongs.