6. The optimum rate of tariff in a small economy is （ ）
A. Zero
B. greater than zero
C. less than zero
D. uncertain
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5. An export-biased growth in home country will cause the terms of trade of ( )
A. Home country to increase
B. Foreign country to decrease
C. Home country to deteriorate
D. Foreign country to deteriorate
4. Trade based on external economies ( )
A. certainly leave the importing country better off
B. may leave both country worse off than they would have been in the absence of trade
C. certainly leave both country both off
D. make the exporting country better off
3. Suppose home country is capital-abundant, foreign country is land-abundant, the trade between the two countries will benefit ( )
A. Home landlords
B. Home capitalists
C. Foreign workers
D. Foreign capitalists
2. If the relative price of cheese in terms of wine is greater than the opportunity cost of cheese in home country but less than foreign country , that is a*LC /a*LW ＞aLC /aLW＞PC /PW , then （ ）
A. Foreign country should specialize in producing wine
Both countries should specialize in producing cheese
C. Home country should specialize in producing wine
D. Both countries should specialize in producing wine
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