Exam 3: Exchange and Markets

Producer A has a comparative advantage over Producer B if,in producing a good:

Suppose that in the time it takes for him to bake a cake,Bob can produce sew 5 pairs of jeans.In the time it takes for Joe to bake a cake,he can produce sew 8 pairs of jeans day.In this example,who has the absolute advantage in baking a cake?

A market failure occurs when companies defraud the public.

What are the three reasons Adam Smith said led to increase productivity with specialization and division of labor?

If a person has an absolute advantage in some activity,she must have a comparative advantage in that activity as well.

Specialization in production will increase total output.

Table 3.2 -Consider two individuals,Rose and Sharon,who produce fish and coconuts.Rose and Sharon's hourly productivity are shown in Table 3.2.Sharon's opportunity cost of producing 1 fish is:

Suppose a car is completely produced and assembled in Germany and is sold to the United States.In this example,if the United States restricts the purchase of the car from Germany,then the country whose overall welfare would be reduced by this policy would be:

Table 3.2 -Consider two individuals,Rose and Sharon,who produce fish and coconuts.Rose and Sharon's hourly productivity are shown in Table 3.2.Which of the following is true?

According to the Application,a chunk of space debris that enters our atmosphere is called a:

A contract:

Suppose a new use for aluminum has been discovered,making aluminum more expensive.In a market system:

Table 3.1 -Table 3.1 illustrates Willy and Blythe's hourly production for apples and carrots.From the table,we can conclude that:

When the government provides its citizens an unemployment insurance program,it is:

One of the most obvious clues to the relative scarcity of a product in a market economy is:

If the findings in the application are true,then if the World Bank wants to improve the return of its infrastructure projects in countries with inefficient governments like Zimbabwe,then it must first:

The more times a worker performs a particular task,the more proficient the worker becomes at that task.This is called:

According to the Application,if Latvia has no absolute advantage relative to its neighboring European y countries,should it still trade with its neighbors?

When a person producing a particular product has a lower opportunity cost than another person,that person is considered to have a ________ over the other.

According to the Application,what determines the price of a meteorite?