Exam 2: Economic Models: Trade-Offs and Trade 25

The owner of the Dismal Philosopher, one of five bookstores on College Road, asks you to make a graph showing each College Road bookstore's share of all five stores' book purchases. The best way to show this information is with:

The circular-flow diagram represents the market for _____ and the market for _____.

Households buy goods and services in the _____ markets.

Which of the following is sold in the factor market?

Use the following to answer questions: -(Table: Price, Quantity Demanded, and Quantity Supplied) Look at the table Price, Quantity Demanded, and Quantity Supplied. The slope of the line representing the relationship between price on the vertical axis and quantity demanded on the horizontal axis is:

If they spend all night writing computer programs, Laurence can write 10 programs, and Carrie Anne can write 5. If they spend all night making sunglasses, Laurence can make 6 pairs, and Carrie Anne can make 4. Given this information and supposing Laurence and Carrie Anne have constant opportunity costs, we know that _____ has an absolute advantage in _____.

A pie chart is used to depict information about:

If an economy is producing a level of output that is on its production possibility frontier, the economy has:

Use the following to answer questions: Figure: Consumer and Capital Goods -(Figure: Consumer and Capital Goods) Look at the figure Consumer and Capital Goods. The movement from curve 1 to curve 2 indicates:

In constructing a model, economists:

Which of the following is FALSE about the circular-flow diagram?

Use the following to answer questions: -(Table: Comparative Advantage I) Look at the table Comparative Advantage I. The opportunity cost of producing 1 box of herring for Sweden is _____ box(es) of cell phones.

An economy is said to have a comparative advantage in the production of one good if it:

If the opportunity cost of manufacturing machinery is lower in the United States than in Britain and the opportunity cost of manufacturing sweaters is higher in the United States than in Britain, then the United States will:

The owner of the Dismal Philosopher, one of the five bookstores on College Road, asks you to make a graph showing each College Road bookstore's share of all five stores' book purchases. A good way to show this information is with a pie chart.

The basis of the circular-flow diagram is that:

If Mary accepts a job as a nurse, she has sold a factor of production in the factor market.

Use the following to answer questions: Scenario: Countries A and B Two countries, A and B, produce two goods, wheat (W) and steel (S). Each has a linear production possibility frontier in both goods. If country A spends all of its available resources to produce wheat, it can produce 500 tons of wheat and no steel. If it uses all of its resources to produce steel, it can produce 250 tons of steel and no wheat. If country B spends all of its available resources producing wheat, it can produce 400 tons of wheat, and if it spends all of its resources on the production of steel, it can produce 400 tons of steel. -(Scenario: Countries A and B) Look at the scenario Countries A and B. If country B produces 300 tons of steel, how many tons of wheat can it produce?

Businesses buy resources used to produce goods and services in the:

As long as people have different _____, everyone has a comparative advantage in something.