Exam 3: Exchange and Markets

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

Markets exist to facilitate exchange between people.

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

Consider two individuals, Phil and Oprah, who produce toy trucks and flowers. Phil and Oprah's hourly productivity are as follows: Who has the absolute advantage or comparative advantage in the production of flowers or trucks?

Can an individual with no absolute advantage find himself with a comparative in producing a good or a service?

Insurance:

If two people both produce goods and each has a comparative advantage, and they exchange goods with each other for mutual benefit, it is called a _______.

Patents:

When there is imperfect information, a role of government is to disseminate information and promote informed choice.

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. Rose's opportunity cost of producing 1 coconut is:

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?

An example of a market failure due to a firm not fully bearing the costs of its production decision is:

In modern economies, individuals in markets make most of the decisions about:

What are some of the roles of government in a market economy?

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

For country A, an import is a good produced in:

Identify markets in which there is an exchange.

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

To make new commercial ventures more attractive for entrepreneurs, _______ can be used to reduce risk.

Table 3.1 -Table 3.1 illustrates Willy and Blythe's hourly production for apples and carrots. Based on the table, Blythe's opportunity cost of 1 carrot is: