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

Figure 2-15 Figure 2-15 shows the production possibilities frontiers for Greenland and Iceland. Each country produces two goods, snow cones and popsicles. -Refer to Figure 2-15.Which country has a comparative advantage in the production of snow cones?

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.an increase in the unemployment rate b.a decrease in a nation's money supply c.a war that kills a significant portion of a nation's population Which of the events listed above could cause a movement from Y to W?

If additional units of a good are produced at an increasing opportunity cost,the production possibility frontier would be bowed outward (concave).

Increasing marginal opportunity cost implies that

Table 2-12 One canoe One Sailboat Guaternala 10 hours 60 hours Monduras 15 hours 75 hours Table 2-12 shows the number of labor hours required to produce a canoe and a sailboat in Guatemala and Honduras. -Refer to Table 2-12.Guatemala has a comparative advantage in the production of

Which of the following are separate flows in the circular flow model?

The payment received by suppliers of entrepreneurial skills is called interest.

Figure 2-19 -Refer to Figure 2-19.Which two arrows in the diagram depict the following transaction: Carter earns a $400 commission for selling men's designer shoes at Brooks Brothers.

Which of the following is a factor of production?

Table 2-3 Production Choices for Dina's Diner Choice Quantity of Sliders Produced Quantity of Hot Wings Produced A 160 0 B 120 50 C 80 100 D 40 150 E 0 200 -Refer to Table 2-3.Assume Dina's Diner only produces sliders and hot wings.A combination of 120 sliders and 100 hot wings would appear

Figure 2-1 -Refer to Figure 2-1.________ is (are)unattainable with current resources.

Figure 2-15 Figure 2-15 shows the production possibilities frontiers for Greenland and Iceland. Each country produces two goods, snow cones and popsicles. -Refer to Figure 2-15.Which country has a comparative advantage in the production of popsicles?

An increase in population shifts the production possibility frontier inwards over time.

Which of the following is not a factor of production?

A worker is hired in a

Table 2-12 One canoe One Sailboat Guaternala 10 hours 60 hours Monduras 15 hours 75 hours Table 2-12 shows the number of labor hours required to produce a canoe and a sailboat in Guatemala and Honduras. -Refer to Table 2-12.What is Guatemala's opportunity cost of producing one canoe?

All of the following countries come close to the free market benchmark except

Table 2-14 One Motorcycle One Guitar Ireland 20 hours 4 hours Scotland 8 hours 2 hours 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.If the two countries specialize and trade,who should export guitars?

The unattainable points in a production possibilities diagram are

Figure 2-6 -Refer to Figure 2-6.If the economy is currently producing at point D,what is the opportunity cost of moving to point B?