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

In 18th century Europe,governments gave guilds legal authority to limit production of goods.This authority obstructed the market mechanism because the guild's actions prevented the forces of ________ from coordinating the self-interested decisions of producers and consumers.

Table 2-5 Table 2-5 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 2-5.What is Finland's opportunity cost of producing one board foot of lumber?

When you purchase a new surfboard you do so in the

Figure 2-9 Figure 2-9 shows the production possibilities frontiers for Greenland and Iceland.Each country produces two goods,snow cones and popsicles. -Refer to Figure 2-9.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 popsicles?

Table 2-4 Table 2-4 shows the output per day of two gardeners,George and Jack.They can either devote their time to mowing lawns or cultivating gardens. -Refer to Table 2-4.What is Jack's opportunity cost of mowing a lawn?

Figure 2-12 -Refer to Figure 2-12.One segment of the circular flow diagram in the Figure shows the flow of funds from market F to economic agents G.The funds represent spending on goods and services.What is market F and who are economic agents G?

If the best lawyer in town is also the best at operating a word processor,then according to the theory of comparative advantage,this person should

Table 2-1 Production Choices for Dina's Diner -Refer to Table 2-1.Assume Dina's Diner only produces sliders and hot wings.A combination of 60 sliders and 25 hot wings would appear

If a country is producing efficiently and is on the production possibilities frontier,the only way to produce more of one good is with an advance in technology.

Figure 2-6 -Refer to Figure 2-6.If the economy is currently producing at point D,what is the opportunity cost of moving to point B?

All of the following are examples of spending on goods and services in the circular flow model except

Figure 2-13 -Refer to Figure 2-13.Which two arrows in the diagram depict the following transaction: Carter earns a $400 commission for selling men's designer shoes at Brooks Brothers.

On a diagram of a production possibilities frontier,economic decline (negative growth)is represented by the production possibilities frontier shifting inward.

Without technological advancement,how can a nation achieve economic growth?

All of the following are considered intellectual property except

An outward shift of a nation's production possibilities frontier can occur due to