Exam 2: The Economic Problem

-In the figure above, point E could be obtained if

A country that has an absolute advantage in producing all goods will ________.

-The above table shows production combinations on a country's production possibilities frontier. What is the opportunity cost of one unit of Y when the production of good Y increases from 16 to 28 units?

In an hour, Andy can make either 5 pizzas or 12 pies and Chris can make either 6 pizzas or 18 pies. ________ advantage in making pizzas.

A factor market is a market in which

Allocative efficiency occurs when it is

Two social institutions that are essential for trade to be organized are ________.

Any production point outside the production possibilities frontier is

-Point C on the production possibilities frontier in the above diagram illustrates

The PPF shifts if

Resource use is allocatively efficient

Most students attending college pay tuition and are unable to hold a full-time job. For these students, tuition is

Assuming farmers can plant either corn or soybeans, as U.S. farmers plant more corn to meet rising global demand

-The term "market" refers to

Japan can use all of its resources to produce 100 videos or 400 shoes. China can use all of its resources to produce 25 videos or 200 shoes. Which nation has the comparative advantage in shoes and which nation has the comparative advantage in videos?

-Production points inside the PPF are

-The figure above illustrates that if this country wishes to have F₂ - F₁ additional food by moving from point A to point B, it will

Marginal cost is the ________ one more unit of a good and ________ of the good increases.

As long as the marginal benefit from a good is greater than its marginal cost, an economy is operating efficiently.

When an economy produces at its allocatively efficient production point