Question 1

When a nation is producing on its production possibilities frontier, if more resources are used to produce one good, then the production of other goods

Accepted Answer

A) must increase. 
B) must decrease. 
C) must remain the same. 
D) must change but they might increase or decrease. 
E) might increase if the nation can produce more efficiently. 
A) must increase. 
B) must decrease. 
C) must remain the same. 
D) must change but they might increase or decrease. 
E) might increase if the nation can produce more efficiently.

Question 2

Why do nations engage in international trade?

Accepted Answer

Nations engage in international trade be

Question 3

-The table above shows a production possibilities frontier for an economy.If the economy tried to produce a combination of 250 loaves of bread and 800 books,

Accepted Answer

A) there is some unemployment. 
B) there is full employment. 
C) the tradeoff between bread and books is inefficient. 
D) it cannot produce this combination because it lacks enough resources or technology. 
E) it is enjoying a free lunch. 
A) there is some unemployment. 
B) there is full employment. 
C) the tradeoff between bread and books is inefficient. 
D) it cannot produce this combination because it lacks enough resources or technology. 
E) it is enjoying a free lunch.

Question 4

How can a nation that is at an absolute disadvantage gain from trade?

Accepted Answer

Being at an absolute disadvantage means

Question 5

-The table above shows a nation's production possibilities frontier.The opportunity cost of a robot between combination D and E is

Accepted Answer

A) 4 pizzas. 
B) 34 pizzas. 
C) 30 pizzas. 
D) 1/4 of a pizza. 
E) undefined because neither point is production efficient. 
A) 4 pizzas. 
B) 34 pizzas. 
C) 30 pizzas. 
D) 1/4 of a pizza. 
E) undefined because neither point is production efficient.

Question 6

-In the above figure, Jack's opportunity cost of producing 1 gallon of bottled water is ________ of soda.

Accepted Answer

A) 2 gallons 
B) 1/2 of a gallon 
C) 6 gallons 
D) 1/4 of a gallon 
E) 1 gallon 
A) 2 gallons 
B) 1/2 of a gallon 
C) 6 gallons 
D) 1/4 of a gallon 
E) 1 gallon

Question 7

Having a comparative advantage means a nation can

Accepted Answer

A) benefit from trade. 
B) produce at a higher opportunity cost. 
C) produce more of the good. 
D) produce without incurring an opportunity cost. 
E) produce the good at a point beyond its PPF. 
A) benefit from trade. 
B) produce at a higher opportunity cost. 
C) produce more of the good. 
D) produce without incurring an opportunity cost. 
E) produce the good at a point beyond its PPF.

Question 8

In one hour John can produce 20 loaves of bread or 16 cakes.In one hour Phyllis can produce 30 loaves of bread or 15 cakes.Which of the following statements is true?

Accepted Answer

A) Phyllis has a comparative advantage in producing bread. 
B) John has a comparative advantage in producing cakes. 
C) Phyllis has an absolute advantage in both goods. 
D) John has an absolute advantage in both goods. 
E) Phyllis has a comparative advantage in producing both cakes and bread. 
A) Phyllis has a comparative advantage in producing bread. 
B) John has a comparative advantage in producing cakes. 
C) Phyllis has an absolute advantage in both goods. 
D) John has an absolute advantage in both goods. 
E) Phyllis has a comparative advantage in producing both cakes and bread.

Question 9

-Robinson Crusoe divides his time between catching fish and gathering fruit.Part of his production possibilities frontier is given in the above table.If Mr.Crusoe is on his PPF and he increases the amount of fruit he gathers from 56 to 90 pounds, the opportunity cost is

Accepted Answer

A) 37 pounds of fish. 
B) 31 pounds of fish. 
C) 17 pounds of fish. 
D) 34 pounds of fruit. 
E) 90 pounds of fruit. 
A) 37 pounds of fish. 
B) 31 pounds of fish. 
C) 17 pounds of fish. 
D) 34 pounds of fruit. 
E) 90 pounds of fruit.

Question 10

What is comparative advantage? Give an example.

Accepted Answer

Comparative advantage is the ability of

Question 11

A production possibilities frontier shows

Accepted Answer

A) the various combinations of output a nation can produce a certain time, given its available resources and technology. 
B) the limits to future growth of a nation. 
C) how money can be allocated among two kinds of goods. 
D) that if price of one good decreases, the price of the other has to increase. 
E) that it is impossible to produce inefficiently. 
A) the various combinations of output a nation can produce a certain time, given its available resources and technology. 
B) the limits to future growth of a nation. 
C) how money can be allocated among two kinds of goods. 
D) that if price of one good decreases, the price of the other has to increase. 
E) that it is impossible to produce inefficiently.

Question 12

A country produces only apples and bananas.Moving from point A to point B along its production possibilities frontier, 5 apples are forgone and 4 bananas are gained.What is the opportunity cost of a banana?

Accepted Answer

A) 4 apples 
B) 5/4 of an apple 
C) 4/5 of an apple 
D) 1 banana 
E) None of the above answers is correct. 
A) 4 apples 
B) 5/4 of an apple 
C) 4/5 of an apple 
D) 1 banana 
E) None of the above answers is correct.

Question 13

Which point in the figure above is an attainable combination that would have unemployed resources?

Accepted Answer

A) point A 
B) point B 
C) point C 
D) point D 
E) point A and point B 
A) point A 
B) point B 
C) point C 
D) point D 
E) point A and point B

When a nation is producing on its production possibilities frontier, if more resources are used to produce one good, then the production of other goods

Why do nations engage in international trade?

-The table above shows a production possibilities frontier for an economy.If the economy tried to produce a combination of 250 loaves of bread and 800 books,

How can a nation that is at an absolute disadvantage gain from trade?

-The table above shows a nation's production possibilities frontier.The opportunity cost of a robot between combination D and E is

-In the above figure, Jack's opportunity cost of producing 1 gallon of bottled water is ________ of soda.

Having a comparative advantage means a nation can

In one hour John can produce 20 loaves of bread or 16 cakes.In one hour Phyllis can produce 30 loaves of bread or 15 cakes.Which of the following statements is true?

-Robinson Crusoe divides his time between catching fish and gathering fruit.Part of his production possibilities frontier is given in the above table.If Mr.Crusoe is on his PPF and he increases the amount of fruit he gathers from 56 to 90 pounds, the opportunity cost is

What is comparative advantage? Give an example.

A production possibilities frontier shows

A country produces only apples and bananas.Moving from point A to point B along its production possibilities frontier, 5 apples are forgone and 4 bananas are gained.What is the opportunity cost of a banana?

Which point in the figure above is an attainable combination that would have unemployed resources?

Getting Started

The Usand Global Economies

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets With Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters

Exam 3: The Economic Problem

When a nation is producing on its production possibilities frontier, if more resources are used to produce one good, then the production of other goods

Why do nations engage in international trade?

-The table above shows a production possibilities frontier for an economy.If the economy tried to produce a combination of 250 loaves of bread and 800 books,

How can a nation that is at an absolute disadvantage gain from trade?

-The table above shows a nation's production possibilities frontier.The opportunity cost of a robot between combination D and E is

-In the above figure, Jack's opportunity cost of producing 1 gallon of bottled water is ________ of soda.

Having a comparative advantage means a nation can

In one hour John can produce 20 loaves of bread or 16 cakes.In one hour Phyllis can produce 30 loaves of bread or 15 cakes.Which of the following statements is true?

-Robinson Crusoe divides his time between catching fish and gathering fruit.Part of his production possibilities frontier is given in the above table.If Mr.Crusoe is on his PPF and he increases the amount of fruit he gathers from 56 to 90 pounds, the opportunity cost is

What is comparative advantage? Give an example.

A production possibilities frontier shows

A country produces only apples and bananas.Moving from point A to point B along its production possibilities frontier, 5 apples are forgone and 4 bananas are gained.What is the opportunity cost of a banana?

Which point in the figure above is an attainable combination that would have unemployed resources?

Getting Started

The Usand Global Economies

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets With Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters