Exam 3: The Economic Problem

The United States can use all of its resources to produce 50 computers or 4,000 shoes.Suppose that at world market prices, one computer exchanges for 100 shoes.Explain how the United States can gain from trade.

-The above figure shows the production possibility frontier for a country.Suppose the country is producing at point E.What would be the opportunity cost to increase the production of wine to 9 thousand bottles?

If Country A can produce an extra plane by giving up two boats, and Country B can produce an extra plane by giving up three boats, then

-The table above shows a nation's production possibilities frontier.If the nation wants to produce 4 robots and 34 pizzas

-The figure above shows the production possibilities frontier for a country.In order for it to move from producing at point A to producing at point B, the country would need to incur an opportunity cost of

-How is economic growth shown in a production possibilities frontier graph?

Suppose that in a PPF graph, wheat is on the vertical axis and jets are on the horizontal axis.Moving down along the PPF, the

Which of the following statements is correct? I∙As the economy grows, the opportunity costs of economic growth decrease. Ii∙Economic growth has no opportunity cost. Iii∙The opportunity cost of economic growth is current consumption forgone.

"When a person is more productive in producing a good or service than another person, the first person has the comparative advantage in producing the good." Is this assertion correct or incorrect? Explain your answer.

A point on the production possibilities frontier reflects an

The opportunity cost of one more slice of pizza in terms of sodas is the

-The figure above shows a production possibilities frontier.In the figure, when the economy moves from point E to point D, what is the opportunity cost of a DVD?

The opportunity cost of producing more of one good on a production possibilities frontier is

When drawing a production possibilities frontier, which of the following is held constant?

"If Mexico is currently operating at a point beyond its production possibilities frontier, then there are unemployed or misallocated resources in Mexico." Is this statement true or false? Briefly explain your answer.

Draw a production possibilities frontier between beans and peas.Label the unattainable points, the attainable points with fully employed resources, and the attainable points with unemployed resources.

-The figure above represents the production possibilities frontier for a country. a∙The nation is currently producing at point B and wants to move to point C.What is the opportunity cost of the move? b∙The nation is currently producing at point B and wants to move to point A.What is the opportunity cost of the move? c∙The nation is currently producing at point D and wants to move to point B.What is the opportunity cost of the move?

Which of the following is an assumption used when drawing a production possibilities frontier? I∙Human wants and desires are limited to what is available. Ii∙Only two goods are considered. Iii∙The level of technology is fixed and unchanging.

As an economy grows,

During a time of high unemployment, a country can increase the production of one good or service