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

The ________ production points on a production possibilities frontier are the points along and inside the production possibilities frontier.

What is meant by the term "free market"?

For each bottle of wine that Italy produces,it gives up the opportunity to make 10 pounds of cheese.France gives up the opportunity to produce of 1 bottle of wine for every 25 pounds of cheese it produces.Which of the following is true about the comparative advantage between the two countries?

Which of the following statements is true?

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

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 necklace?

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.The linear production possibilities frontier in the figure indicates that

Identify whether each of the following transactions will take place in the factor market or in the product market: a.Shondra buys a Harley-Davidson Softail motorcycle. b.Aimee works 20 hours a week at a grocery store. c.Gustavo sells a warehouse to a produce delivery company. d.Ocean Spray increases employment at its Middleboro,Massachusetts plant.

Table 2-16 One Cell Phone Lumber (per board foot) Estonia 40 hours 8 hours Finland 16 hours 4 hours Table 2-16 shows the number of labor hours required to produce a cell phone and a board foot of lumber in Estonia and Finland. -Refer to Table 2-16.What is Finland's opportunity cost of producing one board foot of lumber?

The points outside the production possibilities frontier are

Figure 2-5 -Refer to Figure 2-5.If the economy is currently producing at point X,what is the gain in production if the economy moves to point Y?

Entrepreneurs bring together the factors of production to produce goods and services.

Table 2-20 One Wristwatch Rice (per pound) Tapan 50 hours 2 hours Thailand 30 hours 1.5 hours Table 2-20 shows the number of labor hours required to produce a wristwatch and a pound of rice in Japan and Thailand. -Refer to Table 2-20.What is Japan's opportunity cost of producing one pound of rice?

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.Which country has a comparative advantage in the production of cotton?

Table 2-18 Minnie Mickey Hats 40 50 Umbrellas 10 5 Table 2-18 shows the output per week of two people, Minnie and Mickey. They can either devote their time to making hats or making umbrellas. -Refer to Table 2-18.Which of the following statements is true?

Which of the following statements about an entrepreneur is true?

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 120 pounds of meat,how much vegetables can it produce to maximize production?

Bella can produce either a combination of 60 silk roses and 80 silk leaves or a combination of 70 silk roses and 55 silk leaves.If she now produces 60 silk roses and 80 silk leaves,what is the opportunity cost of producing an additional 10 silk roses?

Table 2-4 Production Choices for Dina's Diner Choice Quantity of Sliders Produced Quantity of Hot Wings Produced A 80 0 B 60 25 C 40 50 D 20 75 E 0 100 -Refer to Table 2-4.Assume Dina's Diner only produces sliders and hot wings.A combination of 40 sliders and 25 hot wings would appear

Table 2-1 Production choices for Tomaso's Trattoria Choice Quantity of Pizzas Produced Quantity of Calzones Produced A 48 0 B 36 15 C 24 30 D 12 45 E 0 60 -Refer to Table 2-1.Assume that Tomaso's Trattoria only produces pizzas and calzones.A combination of 24 pizzas and 30 calzones would appear