15. If large shipments of wheat are made to England, will bills of exchange on London be higher or lower in New York? 16. When in New York a sight draft on London for £5000 sells for $24,150, in which direction are gold remittances likely to be moving? Give reasons. 17. If England sells $10,000,000 worth of our securities to Americans, what is the effect on exchange rates? 18. Show what, in a gold-producing country, would be the relations and interaction of new gold supply, prices, relative amounts of imports and exports, and rate of exchange. (Sumner.) 19. A nation with _n_ dollars in circulation has to pay a war indemnity of _n_ dollars to another country having the same circulation. How much money will each then have, and what will be the effect on prices, foreign trade, rate of exchange? (Davenport.) 20. Suppose an increase in the volume of our currency, due to a new issue of silver, what would be the effect upon international trade? Would this effect be lasting? Would your answer depend at all upon the condition of our currency at the time the increase occurred? 21. If through the improvement of our banking and currency system a much larger percentage of the business of the country comes to be done through the use of credits (rather than money) as the medium of exchange, what will be the effect on (a) the quantity of money in circulation, (b) the general level of prices, (c) the composition of the country's media of exchange, (d) the international movement of gold, (e) the interests of debtors and creditors, respectively? 22. Each one of two countries, A and B, can, by the application of a given amount of labor to its material resources, produce any one or all of the commodities M, N, O, P, Q, R and S, as exhibited in the following table: _Commodity._ _Country A._ _Country B._ =M= 50 tons 60 tons =N= 1000 yards 1100 yards =O= .25 bales 20 bales =P= 900 bushels 800 bushels =Q= 600 ounces 650 ounces =R= 5000 gallons 5000 gallons =S= 2500 pounds 2000 pounds (a) In the absence of restrictive legislation is each country likely to produce all of these commodities for itself? Why or why not? (b) If conditions are such as to lead to the territorial division of labor, which commodities are most likely to be produced in each country? (c) About which of these commodities is there the least certainty on this point? Why? CHAPTER 14 THE POLICY OF A PROTECTIVE TARIFF REFERENCES. _Bolen, G. L._, Plain facts as to the trusts and the tariff. 1902. Pt. II. _Daniels, W. M._, The elements of public finance. Ed., 1911. Pt. II, ch. VII.