Exam 2: Trade-Offs, Comparative Advantage, and the Market System

Figure 2-2 Figure 2-2 above shows the production possibilities frontier for Mendonca, an agrarian nation that produces two goods, meat and vegetables. -Refer to Figure 2-2. If Mendonca chooses to produce 160 pounds of vegetables, how much meat can it produce to maximize production?

Table 2-14 Table 2-14 shows the number of labor hours required to produce a motorcycle and a guitar in Ireland and Scotland. -Refer to Table 2-14. What is Ireland's opportunity cost of producing one motorcycle?

An outward shift of a nation's production possibilities frontier represents

An example of a factor of production is

Figure 2-12 Figure 2-12 shows the production possibilities frontiers for Tahiti and Bora Bora. Each country produces two goods, milk and honey. -Refer to Figure 2-12. What is the opportunity cost of producing one gallon of honey in Bora Bora?

Table 2-16 Table 2-16 shows the number of labor hours required to produce a cell phone and a board foot of lumber in Estonia and Finland. -Refer to Table 2-16. Finland has a comparative advantage in the production of

Table 2-1 Production choices for Tomaso's Trattoria -Refer to Table 2-1. Assume that Tomaso's Trattoria only produces pizzas and calzones. Tomaso faces ________ opportunity costs in the production of pizzas and calzones.

Figure 2-18 -Refer to Figure 2-18. Which two arrows in the diagram depict the following transaction: Barney earns $250 for selling scissors and razors to Floyd's Barber Shop.

Increasing opportunity cost is represented by a ________ production possibilities frontier.

What is economic growth?

Tesla Motors manufactures its cars at a plant in Fremont, California. At this plant, Tesla is able to take advantage of the high level of technical training possessed by its American workers, but it also sacrifices the ability to pay lower wages had it chosen to open its plant in a low-wage country such as Mexico, India, or China. In deciding to open the Fremont plant, Tesla

Figure 2-4 Figure 2-4 shows various points on three different production possibilities frontiers for a nation. -Refer to Figure 2-4. A movement from ________ could occur because of additional government restrictions toward allowing immigrant labor.

Comparative advantage means the ability to produce a good or service

Table 2-17 Table 2-17 shows the output per week of two people, James and Lucy. They can either devote their time to making wagons or making tricycles. -Refer to Table 2-17. Which of the following statements is true?

Figure 2-2 Figure 2-2 above shows the production possibilities frontier for Mendonca, an agrarian nation that produces two goods, meat and vegetables. -Refer to Figure 2-2. What is the opportunity cost of one pound of vegetables?

What does the term "increasing marginal opportunity cost" mean? How are increasing marginal opportunity costs represented on a bowed out production possibilities frontier?

In the circular flow model, households demand resources such as labor services in the product market.

Figure 2-12 Figure 2-12 shows the production possibilities frontiers for Tahiti and Bora Bora. Each country produces two goods, milk and honey. -Refer to Figure 2-12. Which country has a comparative advantage in the production of honey?

Figure 2-8 Figure 2-8 above shows the production possibilities frontier for Vidalia, a nation that produces two goods, roses and orchids. -Refer to Figure 2-8. If Vidalia chooses to produce 60 dozen orchids, how many roses can it produce to maximize production?

Which of the following statements about an entrepreneur is true?