Question

1. What reasons have been given for trade-displaced workers to receive greater benefits than other unemployed persons? (Select all correct answers)

a. Efficiency

b. Technology

c. Equity

d. Productivity

e. Transparency

f. Political Grounds

2. Workers in import-sensitive sectors tend to be ____________ (select all correct answers) more frequently than the average displaced worker.

a. low-wage workers

b. men

c. working at the same job for more time

d. high-skilled workers

e. women

f. unable to find employment in export-related industries

3. How does trade affect the distribution of wages in an economy?

a. Imports create bad, low-wage jobs in manufacturing.

b.Workers in export industries tend to earn higher wages than workers in industries that compete against imports.

c. Imports destroy good, high-wage jobs in manufacturing.

d. A greater share of world income is going to workers (labor) rather than to owners of capital.

4. Which of the following does NOT put a limit on how much work will be offshored?

a. Higher demand for skilled workers puts upward pressure on wages

b. Quality Concerns

c. Cultural Differences

d. Deindustrialization

5. If the U.S. Dollar depreciates against the Swiss franc, a possible explanation would be

a. the inflation rate is lower in the U.S. than in Switzerland.

b.U.S. imports of products from Switzerland have decreased.

c. Swiss firms purchase more soybeans and corn from the US.

d. American investors find better opportunities in Switzerland.

Answer 1

1. Option b, d and f. Technology, productivity and political grounds. Workers who lose jobs due to chepaer imports need to be trained to improve productivity, also technology needs to be implemented and politically this becomes an issue in any country.

2. Generally import sensitive products have tough competition and is generally low paid. Exports need specific products which may need skilled labor and hence a and f are correct options.

3. Option d is wrong as it is owners who earn more. Option b is correct. It is not necessary that import destroy good high wage jobs as domestic company can also be good in quality. However, if productivity is low then it will destroy. Option a is wrong.

4. Offshoring is basing processes or services in another country for lowering costs. Option a puts limit as costs may go up. Option b and d also put it. Option c only remains. It is correct option. Cultural differences may not matter once standard procedure is set.

5.US dollar depreciating means less demand for dollar. Only option d is correct as rest all will lead to appreciation of dollar.