Exam 2: The Economic Problem

Tom and Di grow tomatoes and turnips. Tom has a comparative advantage in growing tomatoes if )

-Refer to the production possibilities frontier in the figure above. Which production point is unattainable?

-The above table shows the production possibilities frontier for the economy of Arkadia. The opportunity cost of increasing cheese production from 500 tons of cheese to 750 tons of cheese is

-The data in the above table demonstrates that gains from trade can be captured if

One point on a PPF shows production levels at 50 tons of coffee and 100 tons of bananas. Remaining on the PPF, an increase of banana production to 140 tons shows coffee production at 30 tons. Still remaining on the PPF, coffee production at 10 tons allows banana production at 160 tons. The opportunity cost of a ton of bananas is

-The above table shows production combinations on a country's production possibilities frontier. What is the opportunity cost of increasing the production of X from 0 to 3 units?

-Employees at Bank of America are good at providing banking services and workers at Ben & Jerry's are good at making ice cream. The figure above shows the marginal cost and marginal benefit curves for ice cream. Point b represents of banking services and ice cream.

The marginal benefit from a good is the maximum amount a person is willing to pay for

Big Lobster sells lobster and fish, and so too does H Salt. If Big Lobster's opportunity cost of preparing lobster exceeds H Salt's opportunity cost, then all the following are true EXCEPT )

Which of the following is TRUE regarding marginal benefit? I. The marginal benefit curve shows the benefit firms receive by producing another unit of a good II. Marginal benefit increases as more and more of a good is consumed. III. Marginal benefit shows the maximum amount a person is willing to pay to obtain one more uni good.

-In the table above, country A is producing 4 units of X and 8 units of Y and country B is producing 4 units of X and 6 units of Y. The opportunity cost of producing more of

An economy that uses new technology .

-Production points inside the PPF are

A person who has an absolute advantage in the production of all goods will

If the marginal benefit of consuming another unit of a good is positive, then to reach the allocatively efficient level of output more of the good should be consumed

-The table above represents different points along a production possibilities curve. What is the marginal cost of moving from 2 bushels to 3 bushels of beans?

The quantity of shoes produced is measured along the horizontal axis of a PPF and the quantity of shirts is measured along the vertical axis. As you move down toward the right along the PPF, the marginal cost of

The slope of a production possibilities frontier that displays increasing opportunity cost is

-Refer to the table above, which gives five points on a nation's PPF. As we increase the production of X,

Production possibilities -The table above shows the production possibilities frontier for the economy of Sauria. If the economy is able to produce 7 hundred guns and 10 tons of butter next year, we can conclude that next year