Question 1

A bowed out production possibility frontier shows that the

Accepted Answer

A)  opportunity cost of a good is constant as more of the good is produced. 
B)  opportunity cost of a good decreases as more of the good is produced. 
C)  opportunity cost of a good increases as more of the good is produced. 
D)  opportunity cost relationship is linear. 
E)  opportunity cost of producing another good is negative. 
A)  opportunity cost of a good is constant as more of the good is produced. 
B)  opportunity cost of a good decreases as more of the good is produced. 
C)  opportunity cost of a good increases as more of the good is produced. 
D)  opportunity cost relationship is linear. 
E)  opportunity cost of producing another good is negative.

Question 2

$$\begin{array} { l c l c } 
\text { Nation A's production in 1 day } & & \text { Nation B's production in 1 day } \
\hline \text { Computers } & 100 & \text { Computers } & 120 \
\text { Software } & 140 & \text { Software } & 150
\end{array}$$
-Two nations can produce computers and software in the amounts given in the table above.Does either nation have an absolute advantage in producing the products?
 Which nation has a comparative advantage in computers?
 Which nation has a comparative advantage in software?
 Explain your answers.

Accepted Answer

Nation B has an absolute advantage in pr

Question 3

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 4

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.

Accepted Answer

@#IMG-DLM& The production possibilities frontier,

Question 5

If a nation has an absolute advantage in producing a good, then it

Accepted Answer

A)  will have a comparative advantage in producing that good. 
B)  will have no need to trade with other nations. 
C)  will always specialize in that good. 
D)  might or might not have a comparative advantage in producing that good. 
E)  will not have a comparative advantage in producing that good. 
A)  will have a comparative advantage in producing that good. 
B)  will have no need to trade with other nations. 
C)  will always specialize in that good. 
D)  might or might not have a comparative advantage in producing that good. 
E)  will not have a comparative advantage in producing that good.

Question 6

$\begin{array}{cccc}
\text { China's production in 1 hour } && \text { Pakistan's production in } 1 \text { hour } \
\hline \text { Cloth } & 8 & \text { Cloth } & 4 \
\text { Cheese } & 16 & \text { Cheese } & 12
\end{array}$
-The table above shows the amounts of cloth and cheese that China and Pakistan can produce in an hour.Which country has the comparative advantage in cloth and which country has the comparative advantage in cheese?

Accepted Answer

In China, to produce 8 cloths has an opp

Question 7

Which of the following is the best definition of economic growth?

Accepted Answer

A)  The investment in capital and consumption goods by an economy. 
B)  The opportunity cost of capital. 
C)  The opportunity cost of consumption. 
D)  Increased development of land and entrepreneurship. 
E)  The sustained expansion of production possibilities. 
A)  The investment in capital and consumption goods by an economy. 
B)  The opportunity cost of capital. 
C)  The opportunity cost of consumption. 
D)  Increased development of land and entrepreneurship. 
E)  The sustained expansion of production possibilities.

Question 8

Scott and Cindy both produce only pizza and tacos.In one hour, Scott can produce 20 pizzas or 40 tacos.In one hour, Cindy can produce 30 pizzas or 40 tacos.Scott's opportunity cost of producing 1 taco is

Accepted Answer

A)  1/2 of a pizza. 
B)  1 pizza. 
C)  2 pizzas. 
D)  20 pizzas. 
E)  2 tacos. 
A)  1/2 of a pizza. 
B)  1 pizza. 
C)  2 pizzas. 
D)  20 pizzas. 
E)  2 tacos.

Question 9

-Point D in the above PPF figure is

Accepted Answer

A)  an attainable production combination with unemployed resources. 
B)  a tradeoff. 
C)  an unattainable production combination. 
D)  a production combination that can be attained once resources are fully employed. 
E)  More information is needed to determine which of the above answers is correct. 
A)  an attainable production combination with unemployed resources. 
B)  a tradeoff. 
C)  an unattainable production combination. 
D)  a production combination that can be attained once resources are fully employed. 
E)  More information is needed to determine which of the above answers is correct.

Question 10

Specialization and trade

Accepted Answer

A)  does not benefit anyone. 
B)  allows nations to produce inside their individual production possibilities frontier. 
C)  allows nations to consume combinations of products that are outside their individual production possibilities frontier. 
D)  shifts the production possibilities frontier inward. 
E)  shifts the production possibilities frontier outward. 
A)  does not benefit anyone. 
B)  allows nations to produce inside their individual production possibilities frontier. 
C)  allows nations to consume combinations of products that are outside their individual production possibilities frontier. 
D)  shifts the production possibilities frontier inward. 
E)  shifts the production possibilities frontier outward.

Question 11

Discuss three factors that can expand a country's production possibilities.

Accepted Answer

Three factors that influence economic gr

A bowed out production possibility frontier shows that the

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?

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.

If a nation has an absolute advantage in producing a good, then it

Which of the following is the best definition of economic growth?

Scott and Cindy both produce only pizza and tacos.In one hour, Scott can produce 20 pizzas or 40 tacos.In one hour, Cindy can produce 30 pizzas or 40 tacos.Scott's opportunity cost of producing 1 taco is

-Point D in the above PPF figure is

Specialization and trade

Discuss three factors that can expand a country's production possibilities.

Getting Started

The Usand Global Economies

Demand and Supply

Gdp: a Measure of Total Production and Income

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and the Natural Unemployment Rate

Economic Growth

Finance, Saving, and Investment

The Monetary System

Money, Interest, and Inflation

Aggregate Supply and Aggregate Demand

Aggregate Expenditure Multiplier

The Short-Run Policy Tradeoff

Fiscal Policy

Monetary Policy

International Trade Policy

International Finance

Filters

Exam 3: The Economic Problem

A bowed out production possibility frontier shows that the

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?

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.

If a nation has an absolute advantage in producing a good, then it

Which of the following is the best definition of economic growth?

Scott and Cindy both produce only pizza and tacos.In one hour, Scott can produce 20 pizzas or 40 tacos.In one hour, Cindy can produce 30 pizzas or 40 tacos.Scott's opportunity cost of producing 1 taco is

-Point D in the above PPF figure is

Specialization and trade

Discuss three factors that can expand a country's production possibilities.

Getting Started

The Usand Global Economies

Demand and Supply

Gdp: a Measure of Total Production and Income

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and the Natural Unemployment Rate

Economic Growth

Finance, Saving, and Investment

The Monetary System

Money, Interest, and Inflation

Aggregate Supply and Aggregate Demand

Aggregate Expenditure Multiplier

The Short-Run Policy Tradeoff

Fiscal Policy

Monetary Policy

International Trade Policy

International Finance

Filters