tips ib
1. Raymond Vernon argued that new products were developed by U.S. firms and first sold in the U.S. market because
c. The wealth and size of the U.S market gave the firms an incentive to develop new products
2. This theory, initially proposed by Raymond Vernon, was based on the observation that for most of the 20th century a very large proportion of the world's new products had been developed by U.S. firms and sold first in the U.S. market.
a. Product life cycle
3. China, deliberately keeping its currency value low against the U.S. dollar in order to sell more goods to the United States and thus amass a trade surplus and foreign exchange reserves is viewed by critics as following a
b. Neo-mercantilist policy
4. Even if we relax the assumptions of the simple Ricardian model that there are constant returns to scale and realistically assume diminishing returns to specialization, it can still be concluded that
a. Free trade is beneficial but the gains may not be as great as in a constant returns case
5. According to the theory of _____, it makes sense for a country to specialize in producing the goods it produces most efficiently and buy the products it produces less efficiently from other countries, even if it could produce the good more efficiently itself.
b. Comparative advantage
6. Which of the following scholars argued that the "invisible hand" of the market mechanism, rather than government policy, should determine what a country imports and what it exports?
c. Adam Smith
7. Identify the theory that suggests that it is in the best interest of business for a firm to invest in upgrading advanced factors of production.
d. National competitive advantage theory
8. According to Adam Smith, if a country is more efficient than any other country in producing a particular product, the country has a ______ in the production of the product.
c. Absolute advantage
9. According to the _____, U.S is a major player in the commercial jet aircraft
c. The wealth and size of the U.S market gave the firms an incentive to develop new products
2. This theory, initially proposed by Raymond Vernon, was based on the observation that for most of the 20th century a very large proportion of the world's new products had been developed by U.S. firms and sold first in the U.S. market.
a. Product life cycle
3. China, deliberately keeping its currency value low against the U.S. dollar in order to sell more goods to the United States and thus amass a trade surplus and foreign exchange reserves is viewed by critics as following a
b. Neo-mercantilist policy
4. Even if we relax the assumptions of the simple Ricardian model that there are constant returns to scale and realistically assume diminishing returns to specialization, it can still be concluded that
a. Free trade is beneficial but the gains may not be as great as in a constant returns case
5. According to the theory of _____, it makes sense for a country to specialize in producing the goods it produces most efficiently and buy the products it produces less efficiently from other countries, even if it could produce the good more efficiently itself.
b. Comparative advantage
6. Which of the following scholars argued that the "invisible hand" of the market mechanism, rather than government policy, should determine what a country imports and what it exports?
c. Adam Smith
7. Identify the theory that suggests that it is in the best interest of business for a firm to invest in upgrading advanced factors of production.
d. National competitive advantage theory
8. According to Adam Smith, if a country is more efficient than any other country in producing a particular product, the country has a ______ in the production of the product.
c. Absolute advantage
9. According to the _____, U.S is a major player in the commercial jet aircraft