Exam 2: The Economic Problem

-In the figure above, if the quantity of yogurt produced increases from 2 gallons an hour to 3 gallons an hour, the opportunity cost of a gallon of yogurt in terms of ice cream is

When production is efficient, .

Consider a production possibilities frontier with corn on the vertical axis and cars on the horizontal. Unusually good weather for growing corn shifts

A key factor that leads to economic growth is

A country produces only pencils and erasers. Pencil production is allocatively efficient if the marginal of a pencil equals the marginal _ _ of .

The opportunity cost of economic growth is

Why does it make sense for economies to specialize according to comparative advantage and trade?

-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. Regarding the production of good X

-Refer to the production possibilities frontier in the figure above. Which of the following movements requires the largest opportunity cost, in terms of good Y forgone, per extra unit of good X?

-In the figure above, the allocatively efficient output of computers is

Suppose that the United States and Cuba decide to open up trade. If each country specializes in the good in which it has a comparative advantage, will gain from that trade because )

-The above table shows production combinations on a country's production possibilities frontier. What is the opportunity cost of one unit of Y when the production of good Y increases from 16 to 28 units?

-In the figure above, point D is

One of the largest categories of exports from the United States is now pop culture: movies, music, TV programming, and videos. A direct conclusion from this information is that, compared to other countries, the United States has

Draw and describe a marginal benefit curve for slices of pizza where the opportunity cost of consuming a slice of pizza is measured as tacos forgone.

-In the table above, country B is producing 4 units of X and 6 units of Y. For country B, the opportunity cost of producing an additional unit of Y is

Explain how the production possibilities frontier illustrates scarcity.

If the marginal benefit from another computer exceeds the marginal cost of the computer, then to use resources allocatively efficiently,

If two countries specialize in the production of goods in which they have a comparative advantage, they can experience gains from trade.

The table above shows the amounts of cloth and cheese that China and Pakistan can produce in an hour. Which country has the comparative advantage in cloth and which country has the comparative advantage in cheese?