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

Figure 2-11 Figure 2-11 shows the production possibilities frontiers for Pakistan and Indonesia. Each country produces two goods, cotton and cashews. -Refer to Figure 2-11.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 cotton?

Table 2-11 One Digital Camera Wheat (per pound) China 100 hours 4 hours South Korea 60 hours 3 hours Table 2-11 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 2-11.Does either China or South Korea have an absolute advantage and if so,in what product?

Figure 2-13 Figure 2-13 shows the production possibilities frontiers for Costa Rica and Guatemala. Each country produces two goods, pineapples and coconuts. -Refer to Figure 2-13.Which country has a comparative advantage in the production of pineapples?

Which of the following is a factor of production?

Table 2-9 Serena Haley Bracelets 8 9 Necklaces 16 12 Table 2-9 shows the output per week of two jewelers, Serena and Haley. They can either devote their time to making bracelets or making necklaces. -Refer to Table 2-9.What is Serena's opportunity cost of making a bracelet?

If a country produces only two goods,then it is not possible to have a comparative advantage in the production of both those goods.

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.a decrease in the unemployment rate B.an increase in a nation's money supply C.an influx of immigrant workers Which of the events listed above could cause a movement from X to Z?

In the desire to have a celebrity's image protected to prevent it from being used in ways he would not approve,a celebrity's estate

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

Which of the following would shift a nation's production possibilities frontier outward?

What does the term "increasing marginal opportunity cost" mean? How are increasing marginal opportunity costs represented on a bowed out production possibilities frontier?

The recession of 2007-2009 would most likely be represented in a production possibilities frontier graph by

What causes a production possibilities frontier to shift inward?

If Sanjaya can shuck more oysters in one hour than Tatiana,then Sanjaya has a comparative advantage in shucking oysters.

The concept of ________ is that the economic cost of using a factor of production is the alternative use of that factor that is given up.

Figure 2-8 Figure 2-8 above shows the production possibilities frontier for Vidalia, a nation that produces two goods, roses and orchids. -Refer to Figure 2-8.What is the opportunity cost of 100 dozen roses?

Table 2-2 Production choices for Billie's Bedroom Shop Choice Quantity of Pillows Produced Quantity of Blankets Produced B 36 0 C 27 7 18 14 E \rho 21 -Refer to Table 2-2.Assume that Billie's Bedroom Shop only produces pillows and blankets.A combination of 9 pillows and 21 blankets would appear

Table 2-8 Possible Output Combinations Cashews (thousands of pounds) Almonds (thousands of pounds) A 35 0 B 30 20 C 25 35 D 20 47 E 15 57 F 10 64 G 5 68 H 0 70 -Refer to Table 2-8.The Nut House produces only cashews and almonds.The table above shows the maximum possible output combinations of the two nuts using all resources and currently available technology. a.Graph the Nut House's production possibilities frontier.Put almonds on the horizontal axis and cashews on the vertical axis.Be sure to identify the output combination points on your diagram. b.Suppose the Nut House is currently producing at point C.What is the opportunity cost of producing an additional 12,000 pounds of almonds? c.Suppose the Nut House is currently producing at point C.What happens to the opportunity cost of producing more and more almonds? Does it increase,decrease or remain constant? Explain your answer. d.Suppose the Nut House is currently producing at point F.What happens to the opportunity cost of producing more and more cashews? Does it increase,decrease or remain constant? Explain your answer. e.Suppose the Nut House is plagued by a variety of white root-rot disease,which destroys cashew trees but not almond trees.Show in a graph what happens to its PPF.

A major factor contributing to the slow growth rate of less-developed economies is

As women's wages have risen relative to men's wages,the opportunity cost to women of doing housework has ________ than has the opportunity cost to men.