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

Table 2-19 Wilma Betty Statues 12 14 Benches 4 7 Table 2-19 shows the output per month of two people, Wilma and Betty. They can either devote their time to making marble statues or making marble benches. -Refer to Table 2-19.What is Betty's opportunity cost of making a statue?

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List the four broad categories of factors of production.

Figure 2-10 -Refer to Figure 2-10.If the economy is currently producing at point A,what is the opportunity cost of moving to point B?

Table 2-10 Fred Barney Pogo Sticks 24 28 Unicycles 8 14 Table 2-10 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 2-10.Which of the following statements is true?

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?

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.What is the opportunity cost of producing 1 pound of cashews in Pakistan?

Which of the following is not a flow in the circular flow model?

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.What is the opportunity cost of producing 1 bolt of cotton in Indonesia?

Table 2-26 One Motorcycle One Guitar Ireland 10 hours 2.5 hours Scotland 9 hours 2 hours -Should countries specialize in producing goods and services based on having a comparative advantage or an absolute advantage? Why?

Individuals who have never been the best at doing anything

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.Suppose Vidalia is currently producing 20 dozen orchids per period.How many roses is it also producing,assuming that resources are fully utilized?

Which of the following statements about a circular flow model is false?

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.If Mendonca chooses to produce 160 pounds of vegetables,how much meat can it produce to maximize production?

Increasing marginal opportunity cost implies that