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

Figure 2-4 Figure 2-4 shows various points on three different production possibilities frontiers for a nation. -Refer to Figure 2-4.Consider the following events: a.a decrease in the unemployment rate b.an increase in a nation's money supply c.an influx of immigrant workers Which of the events listed above could cause a movement from X to Z?

If a country is producing efficiently and is on the production possibilities frontier,the only way to produce more of one good is to produce less of the other.

Which of the following statements about an entrepreneur is true?

Which of the following is an example of spending on goods and services in the circular flow model?

The slope of a production possibilities frontier

In a free market there are significant restrictions on how a good or service can be produced or sold.

Which of the following is an example of spending on factors of production in the circular flow model?

Figure 2-7 Mercedes Benz recently decided to introduce its B-class automobile in the U.S.market, an electric car that is has designed and developed in a partnership with Tesla Motors.Assume Mercedes Benz chooses to produce both electric-engine vehicles and gasoline-engine vehicles.Figure 2-7 shows changes to its production possibilities frontier in response to new developments and different strategic production decisions. -Refer to Figure 2-7.Assume that in 2014,Mercedes reopened one of its factories after an extensive remodelling which now allows for the production of both types of vehicles.This is best represented by the

The production possibilities frontier model assumes which of the following?

Figure 2-19 -Refer to Figure 2-19.Which two arrows in the diagram depict the following transaction: Lizzie Haxem hires "The Paint Pros," a professional painting company,to paint her home.

Table 2-15 George Jack Lawns Mowed 10 6 Gardens Cultivated 5 4 Table 2-15 shows the output per day of two gardeners, George and Jack.They can either devote their time to mowing lawns or cultivating gardens. -Refer to Table 2-15.What is George's opportunity cost of mowing a lawn?

Which of the following statements is + about a simple circular flow model?

How do firms and households interact in markets?

Firms

The production possibilities frontier model assumes all of the following except

Figure 2-12 Figure 2-12 shows the production possibilities frontiers for Pakistan and Indonesia. Each country produces two goods, cotton and cashews. -Refer to Figure 2-12.What is the opportunity cost of producing 1 bolt of cotton in Indonesia?

Figure 2-16 -Refer to Figure 2-16.In the circular flow diagram,market K represents

Rayburn Reed is a highly talented photographer.He has chosen to specialize in photography because of all of the following except

Table 2-9 Serena Haley Bracelets 8 9 Necklaces 16 12 Table 2-9 shows the output per week of two jewelers, Serena and Haley.They can either devote their time to making bracelets or making necklaces. -Refer to Table 2-9.What is Haley's opportunity cost of making a bracelet?

To increase gas mileage,automobile manufacturers make cars small and light.Large cars absorb more of the impact of an accident than small cars but yield lower gas mileage.These facts suggest that a negative relationship exists between safety and gas mileage.