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

Use the following to answer questions: Figure: Unemployment Rate over Time -(Figure: Unemployment Rate over Time) Look at the figure Unemployment Rate over Time. In the time-series graph, as we move from 1993 to 1995, we see that the unemployment rate has _____ from approximately _____ to approximately _____.

Use the following to answer questions: Figure: Hot Drinks Sold and Temperature -(Figure: Hot Drinks Sold and Temperature) Look at the figure Hot Drinks Sold and Temperature. If we move from point L to point M in the figure, the outside temperature has ______ degrees and the number of hot drinks sold has ______.

Use the following to answer questions: Figure: Unemployment Rate over Time -(Figure: Unemployment Rate over Time) Look at the figure Unemployment Rate over Time. In the time-series graph, as we move from 1991 to 1993, we see that the unemployment rate has _____ from approximately _____ to approximately _____.

Use the following to answer questions: -(Table: Coffee and Salmon Production Possibilities) Look at the table Coffee and Salmon Production Possibilities. The table shows the maximum amounts of coffee and salmon that Brazil and Alaska can produce if they just produce one good. The opportunity cost of producing 1 unit of salmon for Alaska is:

An apple is a resource sold in the factor market.

Trade takes the form of _____ when people directly exchange goods they have for goods they want.

Consider a production possibility frontier for Iraq. If in 2014 Iraq's resources are not being fully utilized, Iraq will be somewhere _____ of its production possibility frontier.

An economic model is a simplified version of reality that is used to analyze real-world economic situations.

Use the following to answer questions: Figure: Good X and Good Y -(Figure: Good X and Good Y) Look at the figure Good X and Good Y. If we move from point B to point C in the figure, the x-variable has ______ units and the y-variable has ______ units.

The circular-flow diagram shows how:

Use the following to answer questions: -(Table: Production Possibilities Schedule II) Look at the table Production Possibilities Schedule II. If the economy is producing at Y, the opportunity cost of producing at Z is _____ units of consumer goods per period.

Use the following to answer questions: -(Table: Bongos and Frisbees) Look at the table Bongos and Frisbees. Bill and Mickey make bongos and Frisbees. Who has the comparative advantage in producing Frisbees?

Use the following to answer questions: -(Table: Production Possibilities Schedule I) Look at the table Production Possibilities Schedule I. If the economy produces 24 units of capital goods per period, it also can produce at most _____ units of consumer goods per period.

"The unemployment rate should be higher" is a normative statement.

Economic models are:

Coworkers Yvonne and Rodney are washing dishes and sweeping the floors of the store. They know that to finish both tasks as quickly as possible, each of them should focus on just one task, but they don't know who should do what. Yvonne and Rodney should determine which one:

Increases in resources or improvements in technology will tend to cause a society's production possibility frontier to:

Use the following to answer questions: -(Table: Trade-off of Study Time and Leisure Time) Look at the table Trade-off of Study Time and Leisure Time. A student sleeps 8 hours per day and divides the remaining time between study time and leisure time. The table shows the combinations of study and leisure time that can be produced in the 16 waking hours of each day. If a student decides to consume one additional hour of leisure time, how many hours of study time must she give up?

Economists may disagree about policies because they:

"Steel tariffs will prevent job losses in the steel industry" is a positive statement.