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

Figure 2-5 -Refer to Figure 2-5.If the economy is currently producing at point Y, what is the opportunity cost of moving to point W?

Figure 2-10 Figure 2-10 shows the production possibilities frontiers for Tahiti and Bora Bora. Each country produces two goods, milk and honey. -Refer to Figure 2-10.If the two countries have the same amount of resources and the same technological knowledge, which country has an absolute advantage in the production of milk?

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 Y to Z

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?

Figure 2-10 Figure 2-10 shows the production possibilities frontiers for Tahiti and Bora Bora. Each country produces two goods, milk and honey. -Refer to Figure 2-10.What is the opportunity cost of producing one gallon of honey in Bora Bora?

In a free market there are virtually no restrictions, or at best few restrictions, on how factors of production can be employed.

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.general technological advancement C.a decrease in consumer wealth Which of the events listed above could cause a movement from X to V?

The ________ demonstrates the roles played by households and firms in the market system.

The term "property rights" refers to

It is possible to have a comparative advantage in producing a good or service without having an absolute advantage.

Table 2-7 Table 2-7 shows the output per month of two people, Fred and Barney. They can either devote their time to making pogo sticks or making unicycles. -Refer to Table 2-7.Which of the following statements is true?

Figure 2-3 -Refer to Figure 2-3.Sergio Vignetto raises cattle and llamas on his land.A portion of his land is more suitable for raising cattle, and the other portion is better suited for raising llamas.Which of the graphs in Figure 2-3 represent his production possibilities frontier that displays increasing opportunity costs?

Table 2-10 Table 2-10 shows the output per day of two pet groomers, Tammi and Horace. They can either devote their time to grooming dogs or bathing cats. -Refer to Table 2-10.Which of the following statements is true?

Economic decline (negative growth)is represented on a production possibilities frontier model by the production possibility frontier

Table 2-8 Table 2-8 shows the number of labor hours required to produce a digital camera and a pound of wheat in China and South Korea. -Refer to Table 2-8.What is China's opportunity cost of producing one pound of wheat?

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 X to Y

An example of a factor of production for Dell is

What is meant by the term "free market"?