Exam 2: The Production Possibility Model, Trade, and Globalization

Refer to the graph shown. Given the production possibility curve, the opportunity cost of reading 2 more articles when you are already reading 11 articles is on average:

Refer to the graph below. Which of the shifts explains what would happen to the production possibility curve if improved technologies increased the production of prekindergarten (Pre-K)toys by 25 percent and the production of children's toys by 50 percent?

Given the production possibility tables for First and Second Bakeries shown, we can determine that: First Bakery Second Bukery Conkies Pies Conkies Pies 0 18 0 9 10 12 30 6 20 6 60 3 30 0 90 0

Refer to the graph below. Point A represents a price of:

If there were decreasing marginal opportunity costs, the production possibility curve would be:

Juan works at Texas Burgers in El Paso and earns $8.00 per hour. His twin brother Felipe works in Mexico Burgers in Ciudad Juarez just across the border and earns $3.00 per hour for exactly the same work. An economist looking at this situation sees:

Production possibility curves are upward-sloping because increased production of one good implies reduced production of another good.

What is a production possibilities curve?

Under what assumption(s)is the production possibilities curve a representation of efficiency points?

Suppose that in Slovakia one unit of labor can produce either 20 tons of wheat or 40 tons of soy and in Poland one unit of labor can produce either 40 tons of wheat or 20 tons of soy. If each country has two units of labor, which of the following consumption combinations can be attained only with trade?

Refer to the graph below. Laura's production possibility curve for math and economics problems in one night is shown in the graph. Her opportunity cost of finishing six math problems instead of four math problems is:

In election campaigns, presidents often promise more of everything (that is, more guns and more butter). What would help those elected presidents fulfill that promise?

In what way does the notion of comparative advantage help to explain that production possibility curves are bowed outward (the principle of increasing opportunity cost)? Explain your answer in the context of the tradeoff between guns and butter.

What does a production possibilities table demonstrate?

Refer to the graph shown. Suppose Country X exports agricultural goods to Country Y in exchange for industrial goods. This pattern of trade increases consumption in both countries only if:

The principle of increasing marginal opportunity costs states that the initial opportunity costs are:

If there is a direct relationship between two variables, the graph relating those two variables will be:

Refer to the graph below. In the 1980s, digital publishing reduced the cost of producing books. Assuming no change in the cost of producing DVDs, which of the shifts reflects this change in technology?

Why do marginal opportunity costs increase as you produce more of a specific good?

The slopes of the curve at points A and B (maximum and minimum)are: